What is the effect of forfeiture?


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  1. Liability as past Member: If the liquidation of the company takes place within one year of forfeiture, the member whose shares have been forfeited cannot be held liable as a contributory.
  2. Cessation of liability: The liability of the members whose shares have been forfeited ceases if and when the company receives payment in full of all such money in respect of the shares.
  3. Forfeited shares become the property of the company: The forfeited shares become the property of the company on forfeiture and may be reissued or otherwise disposed off on such terms and in such way as the board thinks correct.

 


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