SPCC 2 Marks Each

If a person is holding convertible debentures which can be converted after a certain period of time, then at the time when the debentures are converted in to equity shares the person becomes equity shareholder as well as Member of the company.

A subsidiary company cannot obtain membership of its holding company. However in following circumstances, subsidiary company can become a member of the holding company. (1) Representative of holding company passes away and subsidiary company holds shares as representative. (2) Subsidiary company is a trustee of any member but has no personal interest in the trust. (3) If the subsidiary company was already member before the execution of this law

Under the following circumstances a person may be shareholder but not a member. (1) Person who has purchased shares is a shareholder but if he has not entered his name in register of members, he is not considered a member. (2) In case of death of a shareholder his legal representative becomes shareholder, but is not member till he is not registered in register of members.

Under following circumstances a person may be member but may not be a shareholder. (1) A person who has signed in Memorandum of Association becomes a Member immediately even though he has not purchased shares. (2) In a company limited by gurantee, member who has given gurantee for a certain amount is considered as a member even if he has no shares. (3) The person who has transferred his shares to others name, is no longer a shareholder. However he remains a member untill his name is deleted from Register of Members. (4) A company without share capital has no shareholder, but still there are members.

Definition of Membership : According to the companies Act “Member is a person who has subscribed to the Memorandum of Association of a company and every other person who has agreed in writing to become a member. Meaning of Mmebership : A person is considered to be a member when his name is registered by written consent or through share application.