Which of the following statements are correct in relation to the issue of share capital for public subscription?
(A) The application money should be at least 5% of the face value of the share.
(B) Calls are to be made as per the provisions of the articles of association.
(C) Where there is no articles of association of its own, the provisions of Table A will apply.
(D) Calls need not be made on a uniform basis on all shares within the same class.
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → (A), (B) and (C) only
When a company issues share capital for public subscription, the amount is usually called in instalments, and a few rules govern them.
(A) The application money should be at least 5% of the face value of the share. Correct. The application instalment cannot be less than 5% of the nominal value.
(B) Calls are to be made as per the provisions of the articles of association. Correct. The directors make calls under the powers the articles give them.
(C) Where there is no articles of association of its own, the provisions of Table A will apply. Correct. A company without articles of its own follows the model provisions of Table A (now Table F under the Companies Act, 2013): one month between two calls, a call of not more than 25% of the face value, and at least 14 days' notice.
(D) Calls need not be made on a uniform basis on all shares within the same class. Incorrect. Calls must be made on a uniform basis on all shares of the same class; one shareholder cannot be asked for more than another holding the same class.
NCERT (2026-27 edition):
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