Saturday, June 30, 2012

Class XI, Principles of Commerce, "Debentures "

A trading company has an implied power to borrow money as an incidental part of its day to day business. In the case of Joint Stock Company the memorandum of association may fix limits to the borrowing powers and in such case borrowing in excess of he limit will be ultra virus to the company. A company therefore generally borrows money by means of issuing documents or bonds which are know as debentures.
It may be regarded as written acknowledgment of a loan by the company conditioning for the promise of repayment of interest and the principle after the specified time, if the loan is redeemable. A debenture must be distinguished from share. While debenture creates a loan a share creates an ownership. A debenture holder is thus creditor and he is entitled to a fixed rate of interest irrespective of profit while the shareholder is the owner who is entitled to receive profits, if there are any.
These are without any security i.e have no charge on any assets of the company. For practical purpose these are merely promissory notes. In the event of liquidation of the company the holders are ranked as unsecured creditors.
These have certain specific rights against the assets of the company in other words the company pledges its assets to the lenders.
These are recorded in the books of company and are payable only to those who are written against them as holders. These can be transferred only by the proper transfer executed deeds.
The names of the holder of debentures are not registered and they are payable to those who present them. They can be transferred by means of redelivery by one person to another
These are repaid by the company after a specific number of years after giving the prescribed notice of redemption to the debenture holder.
These are the debentures which are not paid during life of the company but on the liquidation of company the debenture holder gets their amount back.


  1. Just ωish tο saу yοur article
    is as surpriѕіng. Thе сlаrity on yοuг publish iѕ ϳust cоol and i
    could suppoѕе you агe
    аn exρеrt in thiѕ ѕubject. Well with your permissiοn let me to take holԁ of yοur feеd to stаy updаtеd with impеndіng рost.
    Thanκ you 1,000,000 and pleaѕe
    сaггy on the rewarԁing work.

    Fеel fгеe to ѵisit mу site .

    my page - Pay Day Loans

  2. Lovely blog! I am loving it!! Will come back again.

    I am bookmarking your feeds also.

    my web-site ::
    My page ; trinity industries stock quote

  3. naturally like your web-site but you have to check the

    spelling on several of your posts. A number of them are rife with spelling issues

    and I find it very troublesome to tell the truth nevertheless I’ll surely come

    back again.

    My blog post :: 4 letter word Starting z ending
    My page - 5 star hotels near marbella

  4. Great blog! Is your theme custom made or did you download it from

    somewhere? A design like yours with a few simple adjustements would really make my blog

    stand out. Please let me know where you got your design.
    Many thanks

    Feel free to visit my blog post; hotels passeig gracia barcelona spain
    Feel free to surf my weblog ; spain handball federation

  5. Youre so cool! I dont suppose Ive learn something like
    this before. So nice

    to search out any person with some unique ideas

    on this subject. realy thanks for starting this up. this website is something that's needed on the net, someone with a bit originality. useful job for bringing something new to the internet!

    my web blog ...
    Here is my page ; 4 hour body supplements schedule

  6. Awesome website you have here but I was wanting

    to know if you knew of any user discussion forums that cover the same topics discussed in this article?
    I'd really like to

    be a part of community where I can get responses from other knowledgeable people that share the same interest. If you have any

    suggestions, please let me know. Bless you!

    Feel free to visit my homepage ::
    My blog post ::

  7. I have been surfing online more than three hours today, yet I never found any interesting article

    like yours. It’s pretty worth enough for me. In my opinion, if
    all website owners and bloggers made good content as you did, the
    internet will be a

    lot more useful than ever before.

    Also visit my page ... 2011 nfl nfc playoff schedule
    Look into my blog post :: 2011 world series patches

  8. Hey there, You have done an incredible job.

    I’ll definitely digg it and individually recommend

    to my friends. I am confident they'll be benefited from this site.

    My web blog:
    My web-site :

  9. I wish to convey my respect for your kindness giving support

    to individuals who should have assistance with
    this concern. Your real dedication

    to passing the message across appears to be incredibly

    significant and has in every case encouraged people just like me to arrive at their goals.

    This informative guide indicates this much to me and further more to my fellow

    workers. Thanks a lot; from each one of us.

    Look into my page; 4 letter word starting with q and ending in r
    My webpage : 2011 movies complete list of 2011 movies

  10. Good web site! I truly love how it is easy on my eyes
    and the data are well written.

    I'm wondering how I might be notified when a new post has been made. I've subscribed

    to your RSS feed which must do the trick! Have a great day!

    Here is my web page - 4 horsemen apocalypse Horse Names
    Here is my webpage : airport transfers costa blanca

  11. What’s Happening i am new to this, I stumbled upon this I have
    found It positively helpful and it has helped me out loads.
    I hope to contribute & help other users like its helped
    me. Great job.

    Stop by my webpage
    Take a look at my site ; 3 to 4 weeks pregnant and spotting

  12. Hey there would you mind stating which blog platform you're working with?

    I'm looking to start my own blog in the near future but I'm having a difficult time

    selecting between BlogEngine/Wordpress/B2evolution and Drupal. The reason I ask is

    because your design seems different then most blogs and I'm looking for something completely

    unique. P.S Sorry for getting off-topic but I had to ask!

    Feel free to visit my blog post
    Also see my web site > nixon lodown watch

  13. Great post. I was checking continuously this blog and I

    impressed! Extremely helpful info specifically the

    closing part :) I handle such

    information a lot. I was looking for this certain information

    for a long time. Thanks and best of luck.

    Take a look at my webpage ...
    my page :: i need a product key for microsoft office 2007

  14. I'm usually to blogging and i actually

    admire your content. The article has actually peaks my interest. I am going to bookmark your web site and hold checking for brand spanking new information.

    My site ...
    Here is my webpage - spain netherlands free live

  15. Hello there, just become aware of your blog

    through Google, and located that it is really informative.
    I’m going to

    watch out for brussels. I will be grateful in

    case you proceed this in future. Numerous other

    folks shall be benefited from your writing. Cheers!

    Feel free to visit my web page; 4 letter word starting zi
    Also visit my web site 2012 us open results golf

  16. I loved up to you will obtain performed right here. The caricature is attractive, your
    authored material

    stylish. however, you command get got an nervousness

    over that you would like be turning in the following. ill without a doubt come further beforehand once more

    since precisely the similar nearly a lot regularly inside case you protect this hike.

    Also visit my web page;
    Here is my page ... telemarketing sales jobs

  17. As a Newbie, I am continuously searching online for articles
    that can

    benefit me. Thank you

    my web page ::
    Stop by my web page :: real estate Murcia

  18. We are a bunch of volunteers and starting a brand
    new scheme in our community.

    Your web site offered us with helpful information to paintings

    on. You have done an impressive process and our entire

    community can be grateful to


    Feel free to surf to my weblog:
    Look into my web-site Http://Www.Illegalpropertyspain.Com

  19. Greetings! I know this is kinda off topic

    but I was wondering if you knew where I could find a captcha plugin for my comment form?

    I'm using the same

    blog platform as yours and I'm having difficulty finding one?
    Thanks a lot!

    Feel free to surf to my blog ...
    Feel free to visit my webpage :: 2011 world series of poker final table replay

  20. Hello, i read your blog occasionally and i own a similar one and i was just

    curious if you get a lot of spam comments? If so how do you prevent it, any plugin or anything
    you can recommend? I get so much lately it's driving me

    insane so any assistance is very much appreciated.
    Also see my web page >