Shares can be forfeited:

Share forfeiture is a process where a company cancels the shares of a member who fails to pay the amount called up on their partly paid shares.

When shares are issued on a partly paid basis, the company calls the unpaid amount in installments (Application Money, Allotment Money, First Call, Second Call, etc.). If a shareholder fails to pay any of these calls despite proper notice, the company has the right to forfeit (cancel) those shares as per the provisions in the Articles of Association.

Non-payment of call money is the only valid ground for share forfeiture.

The other options are not valid reasons:

Option 1 - A shareholder's personal banking transactions are unrelated to their shareholding in the company. The company has no authority to forfeit shares for external loan defaults.

Option 2 - Attending meetings is a right, not an obligation. Shareholders cannot be penalized with forfeiture for not attending meetings.

Option 4 - Issuing shares for consideration other than cash (e.g., for assets, services, vendor payments) is a legitimate method of share issue. It is not connected to forfeiture, which relates to non-payment after shares have already been issued.

The correct answer is Option 3 because forfeiture is specifically a remedy available to the company when shareholders default on payment of call money despite receiving proper notice to pay.