Under the Companies (Amendment) Ordinance, 2001 certain provisions relating to buy back of shares have been incorporated keeping in view, the market sentiments and recent developments in the United States of America. The Companies (Amendment) Ordinance, 2001 was promulgated on 23rd October, 2001 and it was further replaced with the Companies (Amendment) Act (57 of 2001) by notification dated December 24, 2001. The objectives of this Act were:-
Betterment of market sentiments
To Promote liberalization of buy-back of shares by the companies less than 10% of the total paid up capital and free reserves of the company and such buy-back has been authorized by means of a resolution passed in its Board Meeting
To provide that no offer of buy-back referred to above shall be made with a period 365 days recalled from the date of the preceding offer of buy-back
To reduce the time limit from 24 months specified under sub-section (8) of Section 77-A of the 1956 Act, for issue of same kind of shares of buy-back to 6 months
To reduce the time limit from 24 months specified under sub-section (8) of Section 77-A of the 1956 Act, for issue of same kind of shares of buy-back to 6 months
