Companies Act MCQ Part 3 for SEBI Grade A

June 3, 2020
Companies Act MCQ Part 3 for SEBI Grade A

Dear aspirants,
We are presenting you the Companies Act MCQ Part 3 for SEBI Grade A Companies Act Section of the exam.

Q1. Which section of Companies Act, 2013 states that SEBI has powers to regulate Issue and transfer of securities?

  1. Section 23
  2. Section 24
  3. Section 25
  4. Section 26

Answer: (2)
The Section 24 of Companies Act 2013 states that Issue and transfer of securities and non-payment of dividend by listed companies or those companies which intend to get their securities listed on any recognised stock exchange in India be administered by the Securities and Exchange Board of India.

Q2. Which section of Companies Act 2013 is related to issue of Shelf Prospectus?

  1. Section 31
  2. Section 32
  3. Section 25
  4. Section 20

Answer: (1)
The provisions relating to the issue of Shelf Prospectus are contained in Section 31 of the Companies Act, 2013.

Q3. A company proposing to issue a red herring prospectus shall file it with the Registrar at least ______ days prior to the opening of the subscription list and the offer

  1. 15
  2. 10
  3. 7
  4. 3

Answer: (4)
Such company proposing to issue a red herring prospectus shall file it with the Registrar at least three days prior to the opening of the subscription list and the offer

SEBI Grade A Test Series

Q4. A company filing a shelf prospectus shall be required to file an ______?

  1. Information Memorandum
  2. Article of Information
  3. Article of Association
  4. Information Article

Answer: (1)
A company filing a shelf prospectus shall be required to file an information memorandum containing all material facts

Q5. If a company want to issue securities in stages, which type of prospectus it must issue?

  1. Red herring prospectus
  2. Deemed prospectus
  3. Shelf prospectus
  4. Abridged prospectus

Answer: (3)
Shelf prospectus means a prospectus in respect of which the securities or class of securities included therein are issued for subscription in one or more issues over a certain period without the issue of a further prospectus.

Q6. What is the validity period of Shelf Prospectus?

  1. 3 months
  2. 6 months
  3. 9 months
  4. 1 year

Answer: (4)
The validity of the Shelf Prospectus shall be for a period not exceeding one year which shall commence from the date of opening of the first offer of securities under that prospectus

Q7. Which among the following prospectus is issued by company prior to the issue of actual prospectus?

  1. Red herring prospectus
  2. Deemed prospectus
  3. Shelf prospectus
  4. Abridged prospectus

Answer: (1)
A company proposing to make an offer of securities may issue a red herring prospectus prior to the issue of a prospectus.

Q8. Which among the following prospectus contains salient features of a prospectus is a brief version of the information contained in the prospectus?

  1. Red herring prospectus
  2. Deemed prospectus
  3. Shelf prospectus
  4. Abridged prospectus

Answer: (4)
Abridged Prospectus means a memorandum containing such salient features of a prospectus. It is a brief version of the information contained in the ‘prospectus’ so that cost of public issue of capital may be reduced.

Q9. Which section of Companies Act 2013 is related to issue of Red herring Prospectus?

  1. Section 31
  2. Section 32
  3. Section 25
  4. Section 20

Answer: (2)
The Section 32 of Companies Act, 2013 states that a company proposing to make an offer of securities may issue a red herring prospectus prior to the issue of a prospectus.

Q10. Which among the following information is not included in Red herring prospectus?

  1. Issue Price
  2. Number of Share offered
  3. Details of Company
  4. Both 1 & 2

Answer: (4)
Red herring prospectus does not include complete particulars of the quantum or price of the securities

You must also read following MCQs:

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Tags: Companies Act MCQ Part 3, Companies Act MCQ Part 3 Quiz