Looking to expand and grow your business beyond its present expanse? Start with incorporating a subsidiary. Our experts can help you with this process for a hassle-free incorporation.
As per Companies Act 2013 (defined under Section 2(87), a subsidiary company in relation to any other company (that is to say the holding company) means a company in which the holding or parent company— (i) controls the composition of the Board of Directors; or (ii) exercises or controls more than one-half of the total share capital; either at its own or together with one or more of its subsidiary companies.
No, the company does not require maintenance of track record to be eligible to incorporate a subsidiary.
A subsidiary company cannot hold shares in its holding company except under the below mentioned circumstances: 1. As a legal representative, 2. As a trustee, or 3. Where the subsidiary company was already holding shares before it became a subsidiary of the holding company.
The subsidiary company may or may not conduct the same business as the parent company. Infact one of the purposes of setting up a subsidiary is to segregate the business structure and create entities with seperate management.
Apart from a wilful application to have its name stuck off from the company register as per the provisions of Section 248(2) of the Companies Act 2013; once the subsidiary