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SK Infrastructure Limited has a paid-up share capital divided into 6,00,000 equity shares of INR 100 each. 2,00,000 equity shares of the company are held by Central Government and 1,20,000 equity shares are held by Government of Maharashtra. Explain with reference to relevant provisions of the Companies Act, 2013, whether SK Infrastructure Limited can be treated as Government Company .?
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SK Infrastructure Limited has a paid-up share capital divided into 6,0...
SK Infrastructure Limited - Government Company or Not?

According to Section 2(45) of the Companies Act, 2013, a Government Company is defined as any company in which not less than 51% of the paid-up share capital is held by the Central Government, or any State Government, or partly by the Central Government and partly by one or more State Governments.

Paid-up Share Capital of SK Infrastructure Limited

SK Infrastructure Limited has a paid-up share capital divided into 6,00,000 equity shares of INR 100 each. This amounts to a total paid-up share capital of INR 6,00,00,000.

Shareholding of Central Government and Government of Maharashtra

Out of the total paid-up share capital, 2,00,000 equity shares of the company are held by the Central Government, and 1,20,000 equity shares are held by the Government of Maharashtra.

Calculation of Percentage of Shareholding

The total number of equity shares held by the Central Government and Government of Maharashtra amounts to 3,20,000. The total paid-up share capital of the company is INR 6,00,00,000. Therefore, the percentage of shareholding by the Central Government and Government of Maharashtra is calculated as follows:

Percentage of shareholding = (Total number of shares held by Central Government and Government of Maharashtra / Total paid-up share capital of the company) x 100
= (3,20,000 / 6,00,00,000) x 100
= 5.33%

Conclusion

As per the provisions of the Companies Act, 2013, SK Infrastructure Limited cannot be treated as a Government Company since the shareholding of the Central Government and Government of Maharashtra is less than 51% of the paid-up share capital. The company is thus a private company and is subject to the provisions applicable to private companies under the Companies Act, 2013.
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Similar CA Foundation Doubts

Features of a Mixed Economy:A mixed economy is an economic system that combines elements of both a market economy and a planned economy. It incorporates features of both private enterprise and government intervention. The correct answer is D, as all of the following features are characteristic of a mixed economy:1. Planned economy:A mixed economy includes elements of a planned economy, where the government plays a role in guiding and regulating economic activities. It formulates economic plans and policies to ensure the efficient allocation of resources and to promote economic stability.2. Dual system of pricing:In a mixed economy, there exists a dual system of pricing, which means that both market prices and government-set prices coexist. While market forces determine prices for most goods and services, the government may intervene to regulate prices in certain sectors to protect consumers or promote social welfare.3. Balanced regional development:Another characteristic of a mixed economy is the emphasis on balanced regional development. The government intervenes to ensure that economic growth and development are not concentrated in specific regions or industries but are spread across different regions and sectors. This helps to reduce regional disparities and promote overall economic stability and social welfare.Benefits of a Mixed Economy:A mixed economy offers several benefits due to its combination of market forces and government intervention. Some of these benefits include:1. Economic efficiency:By incorporating market mechanisms, a mixed economy allows for resource allocation based on supply and demand, which promotes economic efficiency. Market forces encourage competition, innovation, and productivity, leading to higher levels of economic growth.2. Social welfare:Government intervention in a mixed economy enables the provision of public goods and services that may not be adequately provided by the market alone. This includes areas such as healthcare, education, infrastructure, and social security, ensuring a certain level of social welfare and equity.3. Stability and regulation:The government's role in a mixed economy helps to maintain economic stability through macroeconomic policies such as fiscal and monetary measures. It also regulates certain sectors to prevent market failures, protect consumer rights, and ensure fair competition.Conclusion:A mixed economy combines the advantages of both market forces and government intervention. It allows for economic efficiency, social welfare, and stability. The features of a mixed economy include elements of a planned economy, a dual system of pricing, and balanced regional development. These features work together to create a system that promotes both economic growth and social welfare.

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SK Infrastructure Limited has a paid-up share capital divided into 6,00,000 equity shares of INR 100 each. 2,00,000 equity shares of the company are held by Central Government and 1,20,000 equity shares are held by Government of Maharashtra. Explain with reference to relevant provisions of the Companies Act, 2013, whether SK Infrastructure Limited can be treated as Government Company .?
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SK Infrastructure Limited has a paid-up share capital divided into 6,00,000 equity shares of INR 100 each. 2,00,000 equity shares of the company are held by Central Government and 1,20,000 equity shares are held by Government of Maharashtra. Explain with reference to relevant provisions of the Companies Act, 2013, whether SK Infrastructure Limited can be treated as Government Company .? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about SK Infrastructure Limited has a paid-up share capital divided into 6,00,000 equity shares of INR 100 each. 2,00,000 equity shares of the company are held by Central Government and 1,20,000 equity shares are held by Government of Maharashtra. Explain with reference to relevant provisions of the Companies Act, 2013, whether SK Infrastructure Limited can be treated as Government Company .? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for SK Infrastructure Limited has a paid-up share capital divided into 6,00,000 equity shares of INR 100 each. 2,00,000 equity shares of the company are held by Central Government and 1,20,000 equity shares are held by Government of Maharashtra. Explain with reference to relevant provisions of the Companies Act, 2013, whether SK Infrastructure Limited can be treated as Government Company .?.
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