Sole Selling and Sole Buying Agents

Sole Selling and Sole Buying Agents

C.A. (Final) Past Examinations Questions (SCANNER)

1. Explain the restrictions on the powers of company to appoint sole selling agent.
[May, 19891
2. Discuss the provisions of the Companies Act regarding the appointment of sole
selling agents by a company. . [Nov., 19921
3. What is the extent to which the Companies Act empowers the Central Govern
ment to regulate the appointment of sole selling agents? [December, 19901
4. Ram and Co. Ltd. having a paid-up share capital of Rs. 40 lakhs appointed on 1st January, 1988 Lakshman and Co. Ltd. as sole selling agent for a period of 5 years with effect from 1st January, 1988 with the approval of the company in general meeting. The Directors of Lakshman and Co. Pvt. Ltd. were holding 40,000 equity shares of Rs. 10 each, fully paid in Ram & Co. Ltd. since 1st December, 1987. State with reasons whether the appointment is valid. Will your answer be different if Lakshman and Co. Pvt. Ltd. acquired the aforesaid shares only on 1st December, 1988? [May,19891
5. The Board of Directors of a multi-product company, namely "PQR Limited", having a paid-up capital ofRs. 2Slakhs appointed "XYZ Limited" as sole selling agents for all its products in India without prior approval of the company in general meeting and without any condition that the appointment is subject to approval of the company in general meeting. "XYZ Limited", its Directors and their relatives are not holding any shares in "PQR Limited". Discuss whether the appointment of "XYZ Limited" as sole selling agent is valid. State with reasons whether your answer will be different if (a) "XYZ" Limited" is appointed as sole selling agent only for the State of Maharashtra, or for whole of India (b) for only some of the products manufactured by "PQR Limited" or for the entire range of
products. [Nov., 19891
6. J, having substantial interest in XYZ Ltd., is appointed as a Sole Selling Agent by the Board of Directors of the company for a period of 5 years. The company's paid-up share capital is Rs. 49 (Forty-nine) crores. The Board of Directors did not place the matter in the AGM for paucity of time and communicated to J about his appointment, who in turn accepted the appointment.
Explaining the provisions of the Companies. Act, 1956 decide: