Assertion (A): A company has perpetual succession. Reason (R): Insolvency or death of a shareholder will not affect its existence. 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 the correct explanation of (A). Explanation: A company has perpetual succession, meaning it continues to exist regardless of changes in its members. The death or insolvency of a shareholder does not affect the company's existence. This is because the company is a separate legal entity.

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