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A Nidhi Company is not allowed to issue b. Bonds and debentures.

The main restriction placed on Nidhi Companies in India in terms of their business operations is:

a. Cannot conduct business in chit funds, hire-purchase financing, leasing finance, insurance, and securities.

Nidhi Companies are primarily formed for the purpose of borrowing and lending money to their members, and they are restricted from engaging in various other financial activities.

According to the Chit Fund Act of 1982, the security deposit during the registration procedure of a Chit Fund Company is equal to 100% of the chit value. Therefore, the correct answer is:

d. 100% of the chit value

To determine the discount Amit offered to win the auction in the chit fund example, I would need more context or details about the specific example you are referring to. If you can provide additional information or the scenario, I would be happy to help you analyze it and find the correct answer.

The minimum amount of net owned funds that Non-Banking Financial Companies (NBFCs) must have to get registered is Rs. 2 crore. Therefore, the correct answer is:

b. Rs. 2 crore

An NBFC (Non-Banking Financial Company) is not a part of:

c. System of Payment and Settlement

NBFCs are primarily involved in activities like accepting deposits, hire purchase arrangements, and leasing financial services, but they do not operate as part of the payment and settlement system, which is typically managed by banks and other financial institutions.

The correct answer is:

c. An NBFC that does not accept/take public funds

NBFC-ND stands for Non-Banking Financial Company - Non-Deposit taking, which refers to NBFCs that do not accept public

The headquarters of the Department of Financial Companies in the Reserve Bank of India (RBI) is in Mumbai. Therefore, the correct answer is:

c. Mumbai

a. Banks

Term deposits are typically offered by banks, which are financial institutions that accept deposits from customers and provide loans. While other entities like NBFCs (Non-Banking Financial Companies), investment funds, and credit unions may offer similar products, term deposits are primarily associated with banks.

A non-bank financial company (NBFC) is registered under the Companies Act of 1956. Therefore, the correct answer is:

a. Companies Act of 1956

The correct answer is c. Banking Regulation Act, 1949.

This Act allows for foreign investment in Non-Banking Financial Companies (NBFCs) up to 100 percent, subject to certain conditions and regulations set by the Reserve Bank of India (RBI).

d. Opening savings accounts

Non-Banking Financial Companies (NBFCs) typically engage in activities such as providing loans and advances, credit facilities, and acquiring shares/stocks, but they do not offer traditional banking services like opening savings accounts.

The correct answer is:

c. Adverse CIBIL record accepted under certain conditions

In general, while a clean CIBIL record is preferred for registering as a Non-Banking Financial Company (NBFC), certain adverse records may be accepted depending on the specific circumstances and the nature of the defaults. However, it's important to consult the latest regulations and guidelines from the Reserve Bank of India (RBI) or relevant authorities for the most accurate and updated information.

A Nidhi Company is established under Section 406 of the Companies Act, 2013. Therefore, the correct answer is:

a. Section 406

The correct answer is:

a. Taxation

Tax deductibility of debt payments allows businesses to reduce their taxable income, effectively shielding some of their income from taxation.

Providing several investment options within a capital structure caters to:

c. Different types of investors

This approach allows companies to attract a diverse range of investors with varying risk appetites, investment horizons, and return expectations.

In the context of agency costs, 'the agent' is typically considered to be:

a. Management

In this context, management acts on behalf of the shareholders (the principals), and agency costs arise from the potential conflicts of interest between the two

Exiting equity through financing denies founders of:

d. Ownership and control of the entity

When founders seek financing through equity, they often give up a portion of their ownership, which can lead to a loss of control over the company.

In the context of capital gearing decisions, the emphasis is typically on a. Earnings prospects. This is because the ability of a company to generate earnings is crucial in determining how much debt it can safely take on relative to equity. While liquidity balances, the capital gearing technique, and market conditions are also important factors, earnings prospects are often the primary consideration when assessing the appropriate ratios of securities.

Trading on equity typically involves using equity share capital to borrow funds. This practice allows a company to leverage its equity base to raise additional capital, often by taking on debt. Therefore, the correct answer is:

b. Equity share capital

The correct answer is a. Stability of sales.

Equity capital provides a buffer for a company during periods of inconsistent sales, as it does not require fixed repayments like debt. When sales are stable, a company can better manage its expenses and obligations, making equity capital a safeguard during fluctuations in revenue.

Bonus stripping is disallowed under Section 94(8) of the Income Tax Act. This section addresses the tax implications of transactions involving the stripping of bonuses from shares. Therefore, the correct answer is:

b. Section 94(8)

The key concept that helps define the scope of tax planning activities is:

d. Application of current tax regulations to the money obtained

Tax planning primarily involves understanding and applying current tax laws and regulations to optimize tax liabilities based on the income and financial activities of an individual or business.

The assessment year that had no changes for certain deductions is c. Assessment Year 2022-2023.