As per the Companies Act, 2013 when is a company

Solution

Section 70.Prohibition for buy-back in certain circumstances- (1) No company shall directly or indirectly purchase its own shares or other specified  securities— (a) through any subsidiary company  including its own subsidiary companies; (b) through any investment company or group of investment companies; or (c) if a default, is made by the company, in the repayment of  deposit accepted either before or after the commencement of this Act, interest payment thereon, redemption of debenture  or preference shares or payment of dividend  to any shareholder, or repayment of any term loan or interest payable thereon to any  financial institution ,  or  banking company: Provided that the buy-back is not prohibited, if the default is remedied and a period of three years has lapsed after such default ceased to subsist.