General Studies · Companies Act 2013

'Mega Infrastructure Projects Ltd.' has successfully concluded a public issue of shares and is now dealing with the implications of the utilization of the proceeds and the maintenance of its share capital. The directors are contemplating a corporate action that would result in the cancellation of its redeemable preference share capital. Which of the following cumulative statements regarding the company's obligations under Chapter III of the Companies Act, 2013 (specifically Sections 52, 54, and 55) are most accurate? Statement I: The company can use the amount in its Securities Premium Account to provide for the premium payable on the redemption of its existing redeemable preference shares, but a special resolution must be passed by the shareholders for this specific application. Statement II: The company can issue redeemable preference shares only if its Articles of Association authorizes the issue, and the period of redemption shall not exceed twenty years from the date of issue; however, an infrastructure project company may issue preference shares for a period not exceeding thirty years, provided a specified percentage of such shares are redeemed annually. Statement III: Any share issued by the company at a discount after the commencement of the Companies Act, 2013, is void, irrespective of whether the discount was authorized by a special resolution or approved by the National Company Law Tribunal (NCLT), unless the discount is part of an issue under a scheme of corporate debt restructuring or is for the benefit of employees as sweat equity shares. Statement IV: In the case of redemption of preference shares, the company must create a Capital Redemption Reserve (CRR) Account out of its free reserves for the nominal amount of shares redeemed, which can be applied for the issue of fully paid-up bonus shares or for the repayment of any preference share capital.