Question

With respect to the shares of a company, which of the following statements is/are correct?
I. A share is treated as a "Good" under Sale of Goods Act.
II. A person who holds the share of a public limited company has the right to transfer his/her share.
III. A share makes a person the owner of assets of the company.
Select the correct option from the codes given below:

• A. Only I
• B. Only I and II
• C. Only II and III
• D. I, II and III

Hint:

Shares represent an ownership stake in a company, but shareholders do not directly own the companys physical assets.

Answer 1

The Correct Option is B

Step 1: Evaluating Statement I
Shares are generally considered as movable property and are traded under legal frameworks. However, they are not specifically categorized as "goods" in the Sale of Goods Act.
This statement is correct in terms of how shares are treated in transactions.
Step 2: Evaluating Statement II
A shareholder in a public limited company can transfer shares as long as the company’s regulations allow it.
This statement is correct.
Step 3: Evaluating Statement III
Holding shares gives the shareholder a claim on the companys profits and financial performance, but not direct ownership of the assets themselves.
This statement is incorrect. Step 4: Conclusion Only Statements I and II are correct. Therefore, the correct answer is (2). Answer: (2) Only I and II