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Countless business legends have been created, entirely because companies invited the public to subscribe to their securities or trade in existing securities, and thereby enter into a ‘relationship’ with the company.
Section 2(36) of the Companies Act, 1956 defines a prospectus as,
“…any document described or issued as a prospectus and includes any notice, circular, advertisement or other document inviting offers from the public for the subscription or the purchase of any shares in, or debentures of, a body corporate.”
Thus, the prospectus is really the basis of contract between the company and the ‘buyer’...
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