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SHARES OF HOLDING COMPANIES [SECTION 19]
No company directly or indirectly shall hold any share in its holding company. No holding company shall allot or transfer its share to any of its subsidiary companies. Any allotment or transfer of shares of a company to its subsidiary companies shall be void.
This section shall not apply:
- Where subsidiary company hold shares as legal representative of a deceased member of the holding company; or
- Where subsidiary company holds shares as a trustee; or
- Where subsidiary company is a share holder even before it became a subsidiary company of the holding company; In this case, subsidiary company cease to have right to vote at a meeting of the holding company for these shares.
In case of subsidiary company holding shares as legal representative or as trustee, it shall have a right to vote.
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