As per Company Act In India, Promoter means:- a) A person or persons who have over-all control of the company. b) Who make the plan for formation of company. c) Who make the programme to issue the securities to the public and those names are mentioned in prospectus as promoter(s).
Promoters includes the following persons:-
- Promoter Group includes the promoter, an immediate relative of the promoter i.e. any spouse of that person or any parent, brother, sister or child of that person or of the spouse.
- In case promoter is a company, a subsidiary or holding company of that company of that company.
- Any company in which the promoter holds 10% or more of the equity capital or which or which holds 10% or more of the equity capital of the promoter.
- Any company in which a group of individuals or companies or combination thereof who holds 20% or more of the equity capital in that company also holds 20% or more of the equity capital of the issuer company.
- In case the promoter is an individual, any company in which 10% or more of the share capital is held by the promoter or an immediate relative of the promoter or a firm or HUF in which the promoter or any one or more of his immediate relative is a member.
It may be noted that a director or officer of the issuer company or person who are merely working in their professional capacity, are not included in definition of promoters.
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