Q.Discuss whether the following can become members of a company:

Each of these four cases has its own settled answer under the Companies Act, 2013 and allied law.

1. A company. A company is a separate legal person and can validly become a member of another company, provided its own memorandum and articles permit such investment and the Board of the investing company passes the necessary resolution; where the amount invested crosses the monetary limits fixed by Section 186 of the Companies Act, 2013, a special resolution of the investing company's own members is additionally required.
2. A Hindu Undivided Family (HUF). An HUF is not a legal person distinct from its members and cannot itself be entered in the register of members. In practice, the Karta of the family (or another member) applies for and holds shares in his own individual name, and the company recognises only that individual — not the HUF as such — as the member, even though the shares may be treated, for family purposes, as HUF property.
3. An insolvent person. Adjudication as an insolvent does not automatically remove a person's name from the register of members; he continues to be a member, and may even attend meetings and vote, until his name is actually removed. However, on insolvency, the beneficial interest in the shares passes to the Official Assignee or Official Receiver, who becomes entitled to receive dividends and to exercise the rights of membership for the benefit of the insolvent's creditors, even while the insolvent's name remains on the register. …

A common slip is to say an HUF 'can hold shares' without clarifying that this is only through an individual member's name, and to say an insolvent person is automatically disqua …