Practice Test

Q1) On incorporation, a company acquires legal entity with perpetual succession and a _______ Show Answer

Q2) Which of the following is a distinct legal person? Show Answer

Q3) Which of the following is advantage of incorporation of company? Show Answer

Q4) The Companies Act, 2013 extends to the ....... Show Answer

Q5) A company may be ....... Show Answer

Q6) The case of ......, has clearly established the principle that company is a legal person distinct from its members. Show Answer

Q7) Characteristic of a company .... Show Answer

Q8) Characteristic of a company ... Show Answer

Q9) Characteristic of a company .... Show Answer

Q10) The liability of the members of a company is limited to the extent of the ....... of the shares held by them. Show Answer

Q11) Company has ...... succession. Show Answer

Q12) In the case of a company limited by guarantee, the members are liable only to the extent of the .... by them and not beyond, and only when the company goes into liquidation. Show Answer

Q13) Perpetual succession means ...... Show Answer

Q14) A company dies with the death of its shareholders. Show Answer

Q15) The shares of company are said to be ..... Show Answer

Q16) The shares of joint stock companies are .... Show Answer

Q17) In the case of a private company, every member owing fully paid-up shares can freely transfer shares held by him subject to the provisions in the articles of the company. Show Answer

Q18) As a corporate person, the company is NOT entitled to own and hold property in its own name. Show Answer

Q19) Member can claim ownership of any item of the company's assets. Show Answer

Q20) Common seal of the company acts as the official signature of a ...... Show Answer

Q21) A document not bearing common seal of the company is not authentic and has no legal force. Show Answer

Q22) A company being a body corporate can sue but cannot be sued in its own name. Show Answer

Q23) Which of the following is a distinct legal person ? Show Answer

Q24) Members or Shareholders are agents of a company. Show Answer

Q25) Members of a company cannot contract with company. Show Answer

Q26) A partner's liability is always limited whereas that of shareholder may be unlimited either by shares or a guarantee. Show Answer

Q27) A private company cannot have more than ...... Show Answer

Q28) In a public company there must not be less than .... Show Answer

Q29) ....... have homogeneous member. Show Answer

Q30) In a private company there must not be less than .... Show Answer

Q31) As per ..... of the Companies Act, 2013 " company" means a company incorporated under Companies Act, 2013 or under any previous company law Show Answer

Q32) A company is legally required to have its accounts audited annually by a ...... Show Answer

Q33) A company consists of ....... members, whereas a Hindu Undivided Family business consists of ....... members since it consists of members of the joint family itself. Show Answer

Q34) Registration of a company is ...... Show Answer

Q35) "Body Corporate" or "Corporation" includes a company incorporated outside India but does not include ..... Show Answer

Q36) A society registered under the Societies Registration Act come within the term 'Body-Corporate'. Show Answer

Q37) Which one of the following is advantage of incorporation of company ? Show Answer

Q38) Which of the following is advantage of incorporation of company ? Show Answer

Q39) Which of the following is advantage of incorporation of company ? Show Answer

Q40) Which of the following is disadvantage of incorporation of company ? Show Answer

Q41) Where a fraudulent and dishonest use is made of the legal entity, the Court will break through the corporate shell and apply the principle of what is known as ...... Show Answer

Q42) If company do not follow the principle of separate legal entity ...... can be done. Show Answer

Q43) The corporate veil can be lifted : ........ Show Answer

Q44) The corporate veil can be lifted :....... Show Answer

Q45) The corporate veil can be lifted : ...... Show Answer

Q46) Minimum paid-up capital for a private company is ..... Show Answer

Q47) A private company means a company which has .... Show Answer

Q48) A private company means a company which by its articles .... Show Answer

Q49) As per section 2(51) of the Companies Act, 2013, "Key Managerial Personnel", in relation to a company, means ....
(i) Chief Executive Officer or the managing director or the manager
(ii) Company Secretary
(iii) General Manager
(iv) Whole Time Director
(v) Chief Legal Officer
(vi) Chief Financial Officer Show Answer

Q50) Where the corporate veil has been used for commission of fraud or improper conduct, Courts have lifted the veil and looked at the realities of the situation. In relation this which of the following case law can be quoted ? Show Answer

Q51) Where two or more persons hold one or more shares in a private company jointly, they shall be counted as a ...... member. Show Answer

Q52) On which of the following company, the Companies Act, 2013, confers certain privileges ?
(i) Private Companies
(II) One Person Company
(iii) Small Companies Show Answer

Q53) Public company means a company which is not a ..... Show Answer

Q54) Minimum paid up capital for public company is .... Show Answer

Q55) Private Company which is a subsidiary of a public company is treated as .... Show Answer

Q56) Maximum number of members of a private company are .... Show Answer

Q57) A public company must have at least .... Show Answer

Q58) A private company must have at least ...... Show Answer

Q59) In the case of a ....., the directors must file with the Registrar a consent to act as directors or sign an undertaking for their qualification shares Show Answer

Q60) Total managerial remuneration in a public company cannot exceed .... of the net profits. Show Answer

Q61) A company may be .... Show Answer

Q62) ...... is a company not having any limit on the liability of its members. Show Answer

Q63) An association not for profit registered under the Companies Act, 2013 popularly known as .... Show Answer

Q64) Association not for profit has to take ..... from Central Government. Show Answer

Q65) ...... permits the registration, under a license granted by the Central Government, of associations not for profit with limited liability without being required to use the word "Limited" or the words "Private Limited" after their names. Show Answer

Q66) License under section 8 of the Companies Act, 2013, may be granted by Central Government if .....
(i) It is intended to from a company for promoting commerce, art, science, religion, charity or any other useful object
(ii) The company allows the payment of dividend to its members
(iii) Apply its profits or other income in promotion of its objects Show Answer

Q67) Section 2(45) of the Companies Act, 2013 defines a "Government company" as any company in which not less than .... of the paid up share capital is held by the Central Government, or by any State Government or Governments or partly by the Central Government or partly by one or more State Governments. Show Answer

Q68) The auditor of a Government company is appointed or reappointed by the .... Show Answer

Q69) A ...... is a company which is incorporated in a country outside India under the law of that other country and has established a place of business in India. Show Answer

Q70) Every foreign company which establishes a place of business in India must, within ..... of the establishment of such place of business, file with the Registrar of Companies at new Delhi and also with the Registrar of Companies of the State in which such place of business is situated certain documents. Show Answer

Q71) As per .... of the Companies Act, 2013, "One Person Company" means a company which has only one person as a member. Show Answer

Q72) A company shall be deemed to be a subsidiary of another, if and only if .....
(i) That other controls the composition of its Board of directors
(ii) That other holds more than half of the nominal value of its equity share capital
(iii) The first-mentioned company is a subsidiary of any company which is that other's subsidiary.
(iv) That first mentioned company is associate of other company Show Answer

Q73) Company should be formed for a ..... Show Answer

Q74) The ROC is the authority which .....
1.Register companies
2. Carries the audit and appoints auditor in company
3. Receives documents and forms from companies and registers them
4. Maintain records of the companies and makes this record available for public inspection Show Answer

Q75) ....... conceives the idea of the business. Show Answer

Q76) Promoter means .... Show Answer

Q77) Who of the following can be promoter ? Show Answer

Q78) Function of promoter .... Show Answer

Q79) A promoter ..... Show Answer

Q80) A promoter can make a secret profit ? Show Answer

Q81) A ....... stands in a fiduciary relation to the company which he promotes. Show Answer

Q82) Promoter can make a profit .... Show Answer

Q83) The first step towards incorporation of a company is .... Show Answer

Q84) A company is identified by the name with which it is registered and such name of the company is stated in ..... Show Answer

Q85) A company cannot be registered with the name ....
1. Which is undesirable
2. Which is identical to name of an existing company
3. Which is identical to or too nearly resembles the name of an existing company1 Show Answer

Q86) For ascertaining as to whether the proposed name is available for adoption, the promoters are required to make an application to the .... Show Answer

Q87) As per Rule 9 of Companies (Incorporation) Rules, 2014, for reservation of name shall be made in ..... Show Answer

Q88) For ascertaining as to whether the proposed name is available for adoption, the promoters are required to make an application to the Registrar of Companies in Form No. INC 1 along with fee as provided in .... Show Answer

Q89) Which of the following person is NOT eligible to incorporate One Person Company (OPC) as per Companies Act, 2013 ?
(i) Indian citizen and resident in India
(ii) Person who has already incorporated one OPC in India.
(iii) Artificial person
(iv) Indian citizen and non-resident in India. Show Answer

Q90) In relation to OPC, "resident in India" means a person who has stayed in India for a period of not less than ..... days during the immediately preceding one calender year Show Answer

Q91) The memorandum has to be divided into ..... Show Answer

Q92) The first clause of the memorandum is .... Show Answer

Q93) The second clause of the memorandum is .... Show Answer

Q94) The third clause of the memorandum is ..... Show Answer

Q95) The fourth clause of the memorandum is .... Show Answer

Q96) The fifth clause of the memorandum is .... Show Answer

Q97) Registered Office clause of the memorandum shall mention the ..... in which the registered office of the company is to be situated. Show Answer

Q98) The objects clause of company is further divided into .... Show Answer

Q99) A process of examining carefully the contents of documents from legal point of view is known is ... Show Answer

Q100) A partnership firm cannot become member of the company registered under section 8 of the Companies Act, 2013. Show Answer

Q101) The article constitute a contract between the company and its ..... and members inter se. Show Answer

Q102) Model Articles of Association contained in First Schedule can be adopted by .... Show Answer

Q103) Private companies need not to register its own Article. Show Answer

Q104) The provisions contained in the Articles of Association should not conflict with .....
1. Companies Act, 2013
2. Memorandum of Association
3. Any law for the time being in force Show Answer

Q105) Table F of Schedule I to the Companies Act, 2013 contains the formats of .... Show Answer

Q106) Table A of Schedule I to the Companies Act, 2013 contains the formats of .... Show Answer

Q107) Table C Schedule I to the Companies Act, 2013 contains the formats of .... Show Answer

Q108) Table D of Schedule I to the Companies Act, 2013 contains the formats of .... Show Answer

Q109) Table E of Schedule I to the Companies Act, 2013 contains the formats of .... Show Answer

Q110) The memorandum and articles must be ..... Show Answer

Q111) In the case of companies having share capital the subscribers to the memorandum should take at least ...... each. Show Answer

Q112) Table I of Schedule I to the Companies Act, 2013 contains the formats of .... Show Answer

Q113) Table J of Schedule I to the Companies Act, 2013 contains the formats of .... Show Answer

Q114) Which of the following statements is/are correct in relation to One Person Company (OPC) as per the Companies Act, 2013 ?
(i) Minor can become member or nominee of the One Person Company
(ii) Minor can hold share with beneficial interest in One Person Company
(iii) Natural person who is an Indian citizen and resident in India can only incorporate One Person Company.
(iv) One Company Person can carry out non-banking financial investment activities.
(v) One Person Company can convert voluntarily into any kind of company after two years from the date of incorporation. Show Answer

Q115) Who will grant license under section 8 of the Companies Act, 2013 ? Show Answer

Q116) Which of the following statement is CORRECT in relation to Non-Profit making companies registered under section 8 of the Companies Act, 2013 ?
(I) Non-profit making companies registered under section 8 of the Companies Act, 2013 can pay 10% of their surplus as dividend on approval of Central Government.
(II) A firm may be a member of the non-profit making companies registered under section 8 of the Companies Act, 2013.
(III) Non-profit making companies registered under section 8 of the Companies Act, 2013 cannot convert itself into company of any other kind.
(IV) Non-profit making companies registered under section 8 of the Companies Act, 2013 has in its objects the promotion of commerce, art, science, sports, education research, social welfare, religion,charity, protection of environment or any such other objects. Show Answer

Q117) Small company as defined in section 2(85) of the Companies Act, 2013 means which of the following company ? Show Answer

Q118) Which of the following conditions are required to be fulfilled by private company in order to treat it as Small Company under section 2(85) of the Companies Act, 2013 ?
(I) Paid up share capital does not exceed Rs 50 lakhs or such higher amount as may be prescribed which shall not be more than Rs 5 Crores.
(II) Its borrowing as per latest audited balance sheet does not exceed Rs 20 Crores or such higher amount as may be prescribed which shall not be more than Rs 50 Crores.
(III) Turnover as per its last profit & loss account does not exceed Rs 2 Crores or such higher amount as may be prescribed which shall not be more than Rs 20 Crores.
(IV) Paid up share does not exceed Rs 25 lakhs or such higher amount as may be prescribed which shall not be more than Rs 2.5 Crores. Show Answer

Q119) ....... of the Companies Act, 2013 defines "Government Company". Show Answer

Q120) As per section 2(69) of the Companies Act, 2013, which of the following person can be treated as "Promoter" ?
(I) Who has been named as such in a prospectus or is identified by the company in the annual return referred to in section 92.
(II) Who has control over the affairs of the company, directly or indirectly whether as a share holder, director or otherwise
(III) In accordance with whose advice, directions or instructions the Board of Directors of the company is the company is accustomed to act
(IV) Person who is acting in a professional capacity Show Answer

Q121) If the Registrar is satisfied that all requirements, have been complied with, he will register the company and issue the.... Show Answer

Q122) Private company need not to obtain certificate of commencement of business. Show Answer

Q123) A company registered under section 8 of the Companies Act, 2013 may convert itself into company of any other kind only after playing with prescribed conditions. Show Answer

Q124) As regards ratification of promoters contracts, the view taken in ..... was that the company could not ratify contract made by a promoter before its incorporation. Show Answer

Q125) The corollary which the law deduces from this rule of fiduciary relationship is that a promoter may not make, ......., any profit at the expense of the company, he promotes, without the knowledge and consent of the company, and that, if he does make a secret profit in disregard of this rule, the company can compel him to account for it, and surrender the secret profit. Show Answer

Q126) A promoter ..... Show Answer

Q127) According to section 4(2) of the Companies Act, 2013, the name stated in the memorandum shall not -
(a) ...... or ....... too nearly to the name of an existing company registered under this Act or any previous company law.
Show Answer

Q128) The general functions of the articles have been aptly summed up by Lord Cairns, L.C.in .... Show Answer

Q129) Rule 12 of Companies (Incorporation) Rules, 2014 states that an application for incorporation shall be filed with ROC in ....... in case of one person company or ..... in case of other companies. Show Answer

Q130) Rule 14 of the Companies (Incorporation) Rules, 2014 states that for the purpose of clause (b) of sub-section (1) of section 7, the declaration by advocate, a Chartered Accountant, Cost Accountant or Company Secretary-in-Practice shall be in .... Show Answer

Q131) Rule 15 of the Companies (Incorporation) Rules, 2014 states that for the purpose of clause (c) of subsection (1) of section 7, the affidavit shall be submitted by each of the subscribers of the memorandum and each of the first directors named in the articles in ..... Show Answer

Q132) As per rule 25(1) of Companies (Incorporation) Rules, 2014, the verification of registered office shall be filled in .... Show Answer

Q133) Which of the following case clearly established the principal that company is a legal person distinct from its members? Show Answer

Q134) Which of the following is characteristic of a company?
(1) Limited Profit
(2) Corporate Personality
(3) Limited Succession

Show Answer

Q135) Characteristic of a company______
(I) transferability of profit
(II) property of company is joint property of shareholders
(III) Company Common Seal
Show Answer

Q136) The liability of members of a company is limited to the extent of the___ of the shares held by them. Show Answer

Q137) Company has____ succession. Show Answer

Q138) In the case of a company limited by guarantee, the member are liable only to the extent of the____ by them and not beyond, and only when the company goes into liquidation. Show Answer

Q139) Statement A:
A company dies with the death of its shareholders.
Statement B:
In the case of a private company, every member owing fully paid-up shares can freely transfer shares held by him.
Show Answer

Q140) Shares of public companies are_____ Show Answer

Q141) Statement X:
Asa corporate person, the company is not entitled to own and hold property in its own name.
Statement Y:
Member can claim ownership of any item of the company’s assets.
Show Answer

Q142) Which of the following Statement is true and which is false?
P. A company being a body corporate can sue but cannot be sued in its own name.
Q. Member or shareholders are agents of a company.
R. Member of a company cannot contract with company.
S. A partner’s liability is always limited whereas that of shareholder may be unlimited either by shares or a guarantee.
Show Answer

Q143) A company consists of____ members, whereas a Hindu Undivided Family business consist of______ members since it consists of members of the joint family itself. Show Answer

Q144) Which of the following is advantage of incorporation of company?
(I) Limited Personality
(II) Limited Liability
(III) Limited Succession
Show Answer

Q145) Which of the following is advantage of incorporation of company?
A. Capacity to sue
B. Greater social responsibility
C. Corporate personality
D. Detailed winding-up procedure
Show Answer

Q146) Where a fraudulent and dishonest use is made of the legal entity, the Court will break through the corporate shall and apply the principal of what is known as_______ Show Answer

Q147) If company does not follow the principle of separate legal entity______ can be done. Show Answer

Q148) The corporate veil can be lifted:- Show Answer

Q149) The corporate veil can be lifted:- Show Answer

Q150) The corporate veil can be lifted:- Show Answer

Q151) Minimum paid-up capital for a private company is_____ Show Answer

Q152) A private company means a company which by its articles_____
(i) restricts the right to transfer its shares
(ii) Limits the number of members to two hundred not including past and present employee
(iii) Prohibits any invitation to the public to subscribe for any security
Show Answer

Q153) Where the corporate veil has been used for commission of fraud or improper conduct, Court have lifted the veil and looked at the realities of the situation. In relation this which of the following case law can be quoted? Show Answer

Q154) For which type of company, the directors must file with the Registrar consent to act as directors ?
(1) Public Company
(2) Private Company
Show Answer

Q155) Which type of company does not have any limit on the liability of its members ? Show Answer

Q156) Association not for profits has to take _____ from central government Show Answer

Q157) Which of the following section permits the registration, under a license granted by the Central Government, of associations not for profit with limited liability without being required to use the word “Limited” or the words “Private Limited” after their names ? Show Answer

Q158) A_____ is a company which is incorporated in a country outside India the law of that other country and has established a place of business in India. Show Answer

Q159) Who conceives the idea of the business of company? Show Answer

Q160) Who of the following can be promoter?
I. Individual
II. Syndicate Association
III. Company
IV. Partnership Firm
Show Answer

Q161) A promoter of company can be described as____
A. An agent
B. A trustee
Show Answer

Q162) A promoter can make a secret profit. Show Answer

Q163) Who stands in a fiduciary relation to the company? Show Answer

Q164) Which of the following person is NOT eligible to incorporate One person Company (OPC) as per Companies Act, 2013?
(1) Indian citizen and resident in India
(2) Person who has already incorporated one OPC in India
(3) Artificial person
(4) Indian citizen and non-resident in India
Show Answer

Q165) In relation to OPC , “resident in India” means a person who has stayed in India for a period of not less than _____days during the immediately preceding one calendar year Show Answer

Q166) The articles constitute a contract between the company and its ___ and members inter se. Show Answer

Q167) Model Articles of Association i.e. table F contained in first Schedule of the companies Act,2013 can be adopted by _____
A. One Person Company (OPC)
B. Public Companies
C. Private Companies
Show Answer

Q168) Which of the following section of the companies Act,2013 defines
“Government Company” ?
Show Answer

Q169) Rule 12 of the Companies (Incorporation) Rules, 2014 states that an application for incorporation shall be filed with ROC in _____ in case of one person company or _____in case of other companies. Show Answer

Q170) For which type of company, the directors must file with the Registrar consent to act as directors ?
(1) Public Company
(2) Private Company
Show Answer

Q171) Who conceives the idea of the business of company? Show Answer