According to Section 187 of the Companies Act 2013 discussed earlier here, all investments made or held by a company in any property, security or other asset shall be made and held by it in its own name.

The company may hold any shares in its subsidiary company in the name of any nominee or nominees of the company, if it is necessary to do so, to ensure that the number of members of the subsidiary company is not reduced below the statutory limit. [Proviso to Section 187(1)]

This Section does not prevent a company:

(a)    from depositing with a bank, being a banker of the company, any shares or securities for the collection any dividend or interest payable thereon; or

(b)    from depositing with, or transferring to, or holding in the name of a scheduled bank, being a bankers of the company, shares or securities, in order to facilitate the transfer thereof;

(c)     from depositing with or transferring to any shares or securities by way of security for the repayment of any loan advanced to the company or the performance of any obligation undertaken by it;

(d)    from holding investments in the name of depository when such investments are in the form of securities held by the company as a beneficial owner. [Section 187(2)]

Register of Investment:

Any shares or securities in which investments have been made by a company are not held by it in its own name, the company shall maintain a register which shall contain particulars and such register shall be open to inspection by any member or debenture-holder of the company without any charge during business hours subject to such reasonable restrictions. [Section 187(3) read with Section 187(2)(d)]

Every company shall, from the date of its registration, maintain a register in Form MBP – 3 and enter therein, chronologically, the particulars of investments in shares or other securities beneficially held by the company but which are not held in its own name and the company shall also record the reasons for not holding the investments in its own name and the relationship or contract under which the investment is held in the name of any other person. [Rule 14(1) of the Companies (Meetings of Board and its Powers) Rules 2014 read with Section 187(3)]

The company shall also record whether such investments are held in a third party’s name for the time being or otherwise. [Rule 14(2)] The reason for this decision is not required to be disclosed under this rule but in my view this should also be mention with reason under Rule 14(1).

The register shall be maintained at the registered office of the company. The register shall be preserved permanently and shall be kept in the custody of the company secretary of the company or if there is no company secretary, any director or any other officer authorised by the Board for the purpose. [Rule 14(3)]

The entries in the register shall be authenticated by the company secretary of the company or by any other person authorised by the Board for the purpose. [Rule 14(4)]

MBP – 3:

Register of investments not held in its own name by the company

  1. S. No.
  2. Date of the board resolution authorising such investment
  3. Date of investment
  4. Name of the person/ depository in whose name investment is held
  5. Address and E – mail id of person /  depository in whose name investment is held
  6. Purpose of investment
  7. Name of the company or body corporate in which investment is made
  8. Class of securities
  9. Number of securities
  10. Client ID/DP No.
  11. Face value of securities
  12. Paid up value of securities
  13. Cost of acquisition
  14. Date of disposal
  15. Number of securities disposed off
  16. Sale consideration
  17. Balance securities left, if any
  18. Remarks, if any

Please note: This blog post is not a professional advice. I welcome your comments and feedback. Readers may share this post on social media by using buttons given here.



  1. Pingback: Index of Companies Law Posts | AishMGhrana

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