Persuasion Performers Ltd. has defaulted in payment of certain instalments of Bank Loan during the year 2012. On 17th October, 2016, Board passed a resolution to convene a general meeting to pass a resolution authorising

Any default in payment of term loan, public deposits, and debentures becomes a hurdle in buy-back of securities. However, in the instant case, the default is remedied prior to 3 years of the proposal as stated in proviso to section 70(1)(c) of the Companies Act, 2013. Buy-back is also prohibited if done through any subsidiary or further subsidiaries down the line, through any sole or group investment companies and/or if there are failures in compliance of section 92 (annual return), sections 123 or 127 (distribution of dividends) or section 129 (financial statements) of the Companies Act, 2013. In the given case the Company has default of payment of certain installments of the Bank was made good by July, 2013, and three (3) years has been passed before the passing of resolution by Board, So Company can go ahead for the Buy-back proposal. Further, it is necessary to ensure debt to equity ratio is at least 1:2 post buy-back and shares ascribed for buy-back are fully paid-up. Process of buy-back need to be completed within 12 months of authorization. Shares bought back need to be destroyed within seven days of the last date of completion of buy-back.