Board of Adarsh Pvt Ltd sold its undertaking as defined in explanation to Sec 180 1 a The Compa...........

Companies Act-Phase (I & II) Board-powersandMeetings

Board of Adarsh (Pvt) Ltd sold its undertaking as defined in explanation to Sec 180(1)(a). The Company at the GM objected to such an exercise of power calling it to be a wrongful as it was without approval of Company through Special Resolution as required for sale of undertaking u/s 180(1)(a) of Companies Act, 2013. Owing to the same, the title of the purchaser of the undertaking was brought into question. Is the treatment correct.

Yes, the title of the purchaser is invalid if the Company fails to provide a special resolution where needed under Companies Act

No, as the title of the purchaser is free from any defect in procedure of approval provided the purchaser has made purchase in good faith as per section 180

Yes, as the decision taken relates to sale of undertaking and the same is void ab initio and doctrine of indoor management doesn’t protect outsiders

No as these provisions are N.A. to Adarsh

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Explanation:

Section 180 of Companies Act, 2013 – Restrictions on powers of Board. Section 180 shall not apply to a private company, vide Notification No. 464(E) dated 5th June, 2015.