CA Inter P1 · Chapter 10 · Question 7 of 10
Case: Kaustubh Ltd has 8,00,000 fully paid equity shares outstanding. Under section 68, the maximum number of equity shares it can buy back in a financial year, considering only the limit on the number of shares, is:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) 2,00,000
Explanation
Section 68 provides that the buyback of equity shares in any financial year shall not exceed 25% of its total paid-up equity capital in that financial year. 25% of 8,00,000 shares = 2,00,000 shares. 80,000 reflects the 10% figure, which is the value-based limit for a board-only buyback, not the limit on the number of shares.
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