Suvidha Ltd. was on the verge of expansion. It was requiring ₹40 lakhs for modernisation of its Machinery. It decided to issue Rs.30 lakhs, 7% debentures to public for cash and to borrow ₹10 lakhs from SBI Bank as long term loan, with a condition from SBI to issue ₹12 lakhs. 7% debentures as a subsidiary security besides the primary security, to which the company agreed. The face value of 7% debenture was ₹100.
Identify the debentures that are transferrable by mere delivery.
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → Bearer debentures
Bearer debentures are payable to whoever holds them. The company keeps no register of their holders, so they pass from one person to another by mere delivery, and interest is paid to the person who produces the coupon.
NCERT (2026-27 edition):
NCERT (2026-27 edition):
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