Assertion (A): A company has perpetual succession. Reason (R): Shares of a company are transferable in the manner provided in the articles of the company. In the context of the above two statements, which of the following is correct?

Question

KollegeApply · Accepted Answer

Both (A) and (R) are true and (R) is a correct explanation of (A). Explanation: Assertion (A) is true - A company has perpetual succession, meaning it continues to exist regardless of changes in its membership. Reason (R) is also true - Shares are transferable as per the company's Articles of Association. However, transferability of shares is not the reason for perpetual succession. So, (R) does not explain (A).

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