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Secretarial Practice · Class 12 Commerce

Ch 6Correspondence with Members — Class 12 Secretarial Practice, concept-first.

A member (shareholder) is one of a company's own owners, and the Companies Act, 2013 casts the Company Secretary as the officer who keeps the company's relationship with every member on a proper, written, and legally correct footing — from the day a person applies for shares to the day they receive a dividend on them.

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Key concepts

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Correspondence with Members — Meaning and Importance

Correspondence with members is the written communication a company, through its Company Secretary, addresses to its shareholders in that capacity, covering occasions such as allotment, calls, regret/refund, bonus and rig…

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Chapter contents

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Overview

A member (shareholder) is one of a company's own owners, and the Companies Act, 2013 casts the Company Secretary as the officer who keeps the company's relationship with every member on a proper, writ…

1

Correspondence with Members — Meaning, Importance and Occasions

Meaning: "correspondence with members" means the written communication a company — drafted and issued by, or under the authority of, the Company Secretary — addresses to the persons who hold its share…

2

Letter of Allotment of Shares

When it is written: once the Board of Directors has passed a resolution allotting shares to applicants (and, where required, the return of allotment has been filed with the Registrar under Section 39)…

3

Call Letter — Call on Shares

Meaning of a call: where shares are issued partly paid (a common practice for large issues), the company does not demand the full nominal value at once; it collects the balance in one or more later in…

4

Letter of Regret for Non-Allotment, with Refund

When it is written: whenever an application for shares cannot be allotted in full — because the issue is over-subscribed, or the company decides not to allot to a particular applicant at all — the Sec…

5

Correspondence Regarding Bonus Shares and Rights Shares

Bonus shares [Section 63, Companies Act, 2013]: a company with sufficient accumulated profits may capitalise part of its free reserves, securities premium account, or capital redemption reserve by iss…

6

Correspondence Regarding Transfer and Transmission of Shares

Transfer of shares [Section 56, Companies Act, 2013]: a transfer is the voluntary act of a member selling or otherwise handing over their shares to another person, executed through a proper instrument…

7

Correspondence Regarding Payment of Dividend

Meaning: a dividend is the portion of a company's distributable profits that the company decides to pay out to its members in proportion to their shareholding.

8

Unclaimed Dividend and Transfer to the Investor Education and Protection Fund

Unpaid Dividend Account [Section 124, Companies Act, 2013]: if a dividend declared by a company remains unpaid or unclaimed even after the 30-day payment period expires, the company must, within 7 day…

Sample & Board Papers

Sample papers and previous-year board questions for this subject.

+Show 14 questions14 questions
  1. Q1Select the correct answer from the options given below and rewrite the statement. The dividend is to be paid to the shareholders within ____…Preview
  2. Q2Distinguish between the following. Transfer of Shares and Transmission of SharesPreview
  3. Q3Justify the following statement. The Board of Directors can refuse transfer of shares.Preview
  4. Q4Write a letter to the member for the payment of the Interim dividend electronically.Preview
  5. Q5Find the odd one. (a) Dividend Warrant (b) Interest Warrant (c) Demat (d) Share WarrantPreview
  6. Q6Write a letter to the member for the issue of Share Certificate.Preview
  7. Q7Write a letter to the member for the payment of dividends through the Dividend Warrant.Preview
  8. Q8Draft a reply letter resolving the query of the member on low rate of dividend.Preview
  9. Q9Letter of ______ is sent to applicants who have not been given shares by the company. (a) regret (b) renunciation (c) allotmentPreview
  10. Q10Shares issued free of cost to the shareholders are known as ______ shares. (a) preference (b) equity (c) bonusPreview
  11. Q11Write a word or a term or a phrase which can substitute the following statement: Transfer of shares due to operation of law.Preview
  12. Q12Draft a reply letter resolving the query of the member on low rate of dividend.Preview
  13. Q13Write a word / term / phrase which can substitute the following statement: A letter informing the applicant that shares have not been allott…Preview
  14. Q14State with reasons whether the following statement is True or False: Transfer of shares is initiated by the company.Preview

More questions

11 Q
+Show 2 questions2 questions
  1. Q5State any four occasions on which the Company Secretary corresponds with the members of a company.Free
  2. Q6State any four requisites of a valid call on shares.Preview
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  1. Q1Under Section 39(3) of the Companies Act, 2013, where an application for shares is not allotted, the application money must be refunded with…Free
  2. Q2Under Section 124(6) of the Companies Act, 2013, shares on which dividend has remained unclaimed for how many consecutive years must be tran…Preview
+Show 2 questions2 questions
  1. Q3What is meant by "correspondence with members"?Free
  2. Q4What is meant by "transmission of shares"?Preview
+Show 1 question1 question
  1. Q7Distinguish between Transfer of Shares and Transmission of Shares.Preview
+Show 1 question1 question
  1. Q8Explain the statutory procedure regarding an unclaimed dividend and its eventual transfer to the Investor Education and Protection Fund (IEP…Preview
+Show 3 questions3 questions
  1. Q9Draft a letter of allotment to be sent by the Company Secretary to a successful applicant for equity shares, stating the shares allotted and…Free
  2. Q10Draft a letter of regret to be sent by the Company Secretary to an applicant to whom no shares could be allotted due to over-subscription, e…Preview
  3. Q11Draft a call letter to be sent by the Company Secretary to a member, demanding the First Call money due on the partly paid equity shares hel…Preview