MCQs for CA Final Exam - CAFinal[dot]Org: Complete Learning Portal for CA Final Students

Quiz

Q1. Whether the unsecured creditors holding decree but not executed and other unsecured creditors stand under different class for the purpose of meeting to be held under compromise and arrangement

Obtaining decrees or filling suits by an unsecured creditor does not make him a secured creditor and considered as single class

Unsecured creditor holding decree and unsecured creditor have different rights shall be treated in different classes for Compromise and arrangement

Depends on Annual General Meeting

Depends on Directors

Q2. Satyam Ventures Limited, a listed company filed a petition to the tribunal for the scheme of Compromise and Arrangement under Section 230. The Scheme included a takeover offer. The Tribunal approved the scheme of C&A but there was no compliance followed by the Listed company as per the SEBI (SAST) Regulations, 2011. Comment on the following case

The Tribunal has sanctioned the scheme and hence binding on company, members, creditors or class therof and no further compliance is necessary

Compromise or Arrangement may include takeover offer but for listed companies, takeover offer shall be according to SEBI (SAST) Regulations, 2011 and compliance needs to be done according to

Depends on Annual General Meeting

Depends on Directors

Q3. In the scheme of merger and amalgamation of ABC Ltd. and XYZ Ltd., the valuation of former company was done on the basis of Book Value method while the valuation of second company was done on the basis of average market price method. The Regional director opposed the case saying that the method of valuation for pricing of the shares shall be same. Decide on the above whether this valid or not?

The tribunal shall reject the scheme on the ground that RD has contended on the valuation of the shares

The valuation of shares are carried by professionals and hence unless there is some fraud or mala fide intention involved, the scheme can be approved by the Tribunal

Depends on Annual General Meeting

Depends on Directors

Q4. Liability in respect of offences committed under this act shall not anyway continue after such merger, amalgamation, acquisition? True or false

FALSE

TRUE

Partly true

Partly false

Q5. Can the Tribunal intervene by supervising or modifying it for its implementation after sanctioning the scheme of Compromise & Arrangement

No the Tribunal cannot interfere in between the once the scheme is being sanctioned

It is the duty of officers appointed, if any or directors to follow the orders of Tribunal and make the scheme implement properly

Both a and b

Yes the Tribunal has the power to supervise or give directions or make modification to make proper implementation of the scheme

Q6. The tribunal may not call the meeting or creditors or class of creditors in the following situations

When the creditors or class of creditor majority in number have given their consent in writing

When the creditors or class of creditor majority in number and majority in value have given their consent in writing

When the creditors or class of creditor of 90% in value have given their consent by way of affidavit

When the creditors or class of creditor of 75% in value have given their consent by way of affidavit

Q7. Which of the following concept is the result of dispute

Arrangement

Merger

Compromise

Amalgamation

Q8. The scheme of compromise or arrangement should be approved by the members or class of members or creditors or class of creditors. What is the minimum requirement for the same

It shall be approved by more than 50% majority in number of members, class of members, creditors and class of creditors

It shall be approved by more than 75% majority in value of members, class of members, creditors or class of creditors

It shall be approved by more than 75% majority in number of members, class of members, creditors and class of creditors

Both a and b togeth er

Q9. Transferee Company u/s 235 shall give notice to dissenting shareholders in Form

CAA 4

CAA 14

CAA5

CAA1

Q10. For buy-back of securities which is part of scheme of compromise and arrangement, is it necessary to comply with Section 68 of Companies Act, 2013 separately

As sec 230 is a complete code, it Is not necessary to comply with sec 68 of companies act, 2013

The tribunal shall not sanction the scheme of C&A involving buyback of securities unless there is compliance of Section 68

Depends on Annual General Meeting

Depends on Directors

Q11. When registrar refuses registration of offer of scheme the aggrieved party file appeal to tribunal in Form---- -------- with affidavit---------

NCLT 2, NCLT 6

NCLT 9, NCLT 6

NCLT 7, NCLT 5

NCLT 1, NCLT 3

Q12. Comment on the following whether it is true or false: Where a decree has already been executed, the unsecured creditors will not be clubbed with those who are yet to obtain decrees

As the decree has been executed, the rights and liabilities are different and hence the statement is true

Even though the decree has been executed, the rights and liabilities remains same hence the statement is false

Depends on Annual General Meeting

Depends on Directors

Q13. For division of classes or considering the class of members or creditors, will equity and preference shareholder stands under the same class or different

Equity and preference shareholder shall be considered in different class

They both belong under the same class as they are a part of share capital together

Depends on Annual General Meeting

Depends on Directors

Q14. Notice of proposed scheme inviting objects or suggestion from registrar or official liquidation is issued by transferor or transferee in Form

CAA9

CAA1

CAA2

CAA5

Q15. Majority shareholders shall deposit amount of value of shares acquired by them in separate bank A/c for atleast------------ for payment to minority.

6 months

10 months

1 year

3yr

Q16. Who can make an application to the NCLT under section 230

Member or any class of members

Creditors or any class of creditors

Company itself

All of the above

Q17. Majority voting u/s 235 is?

75% in value

90% in value

100% in total

25% in value

Q18. The members an creditors have agreed to the scheme of compromise and arrangement in dual majority as per the Companies Act, 2013. But the Tribunal has not sanctioned the scheme of compromise and arrangement. Comment on the following whether the scheme shall be binding on company, all creditors, members or class thereof?

The scheme shall be binding on company, all creditors, members or class thereof only when approved by requisite majority in number and value

The scheme shall be binding on company, all creditors, members or class thereof when sanctioned by tribunal but not necessarily approved by members, creditors, or class thereof

The scheme shall be binding on company, all creditors, members or class thereof when approved by members, creditors, class thereof and sanctioned by Tribunal

None of the above

Q19. Valuation for listed Companies for purchase of minority shareholding be done according to

Fair price of shares

Methodological format

As decided by SEBI

Highest price during paid 12 mths

Q20. In the famous case of Sadanand Varde Vs State of Maharashtra, what all has been held: 1. Provisions relating to compromise, arrangement and amalgamation are a complete code 2. A scheme of compromise or arrangement is intended to be a single window clearance system 3. If a scheme of C&A includes increasing share capital, it can be done as a part of scheme without complying with the specific provisions of Companies Act 4. If a scheme of C&A includes reduction of share capital, it can be done as a part of scheme but with complying with the specific provisions of Companies Act

1,3 &4

1&4

1,2 &3

All points 1-4