CA Inter P2 · Chapter 1 · Question 3 of 9
Which of the following is NOT a restriction that the articles of a private company must contain under section 2(68)?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) A restriction on the company accepting loans from its directors
Explanation
Section 2(68) requires the articles of a private company to restrict the right to transfer shares, limit the number of members to 200 (except an OPC) and prohibit any invitation to the public to subscribe for its securities. The Act places no such restriction on accepting loans from directors.
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