Issue of compulsorily convertibles debentures

V.Satya venkatarao (Querist) 13 October 2011 This query is : Resolved
Often we see Companies ( Both Public Ltd & Pvt Ltd) issuing Compulsorily convertibles debenture on private placement to the subscribers of such CCD. My particular query is whether there can be a put option /Call option on the company itself for redemption of such debentures or to put it differently , is a redemption of CCD possible under the companay Law

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Raj Kumar Makkad (Expert) 13 October 2011
No. Such debentures are nothing but a private and illegal sale of promoters quota which do not acquire any special status and no call option can be made against company to redeem such debentures.

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