Can A Minor Be A Shareholder Of A Company?

Can A Minor Be A Shareholder Of A Company?

According to Section 3 of Indian Majority Act, 1785, a minor is a man who has not yet accomplished dominant part or the age of eighteen years. According to Indian Contract Act, 1872, such a man (minor) can't go into any understanding. Along these lines, a minor can't go into contract. In any case, Companies Act, 2013, states that any individual, independent of age, can be named as a chief and hold partakes in the organization. So how is this conceivable? 

As you may have speculated, a minor must be an investor through his or her gatekeeper. Besides, a minor can't effectively purchase partakes in an organization. They should either be skilled to him/her or exchanged. The watchman shields the interests of the minor and must deal with the offers. 

Thus, a minor may likewise turn into a chief, if a watchman is named as executive for a similar span. 

Right of a Minor as Shareholder 

Minors have the privilege to vote in the general body meeting and the voting rights will rely on the extent of offers the minor holds inside the organization. 

It is, nonetheless, basic to take note of that the minors don't hold any risk to the organization. They will, along these lines, not have to pay up on the off chance that the organization is broken up. They, in any case, will get their contribution if the organization goes into liquidation. 

Subsequently, a minor can appreciate every one of the advantages of the organization, without being obligated for any issues the organization may experience.


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