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Q46 (IAS/2003) Economy › Industry, Infrastructure & Investment › Corporate and business forms Answer Verified

Debenture holder of a company are its

Result
Your answer: —  Â·  Correct: B
Explanation

Debenture holders are creditors of the company. Debentures are medium- to long-term debt instruments under which the company is obligated to pay a specified amount plus interest; they form part of capital structure but are not equity and do not confer voting rights—features that identify debenture holders as lenders rather than owners [1]. Debt securities require repayment of principal and interest, and holders of such debt receive fixed returns and have claims on company assets that are distinct from shareholders’ ownership rights; in insolvency they have priority over equity holders, underscoring their creditor status [2]. Hence, debenture holders are creditors, not shareholders, debtors or directors.

Sources

  1. [1] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > Features of Debentures > p. 264
  2. [2] Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 2: Money and Banking- Part I > 2.4 Securities > p. 42
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