ANNUAL GENERAL MEETING(S) 2021


At the hight of the cold wave at New Delhi, Ministry of Corporate Affairs suddenly awakens to issue two circulars within hours. We have an interesting observation: the first one published a regular font Arial/Times New Roman (who cares the font) but second used a font called – Comic Sans MS. Use of the font in a law communication communicates. We will read this circular in this post.

http://mca.gov.in/Ministry/pdf/GeneralCircularNo.02_14012021.pdf

The circular may use simpler language. Without a straightforward acknowledgement of the fact, many companies could not convene their Annual General Meeting due to be held in calendar 2020 it provide a bit of relief. 

The circular applies to companies whose Annual General Meetings:

  1. Were due to be held in the year 2020 (but could not be conducted due to whatsoever reason); or
  2. Become due in the year 2021.

The Government decided to allow these companies to conduct their meetings on or before 31 December 2021.

The circular clarifies that such Annual General Meetings may be conducted in accordance with Circular 20/2020. The Circular 20/2020 allows companies to conduct Annual General Meetings through Video Conferencing or any other audiovisual mode.

The first paragraph of the circular may create two confusions:

a. Due date for the Annual General Meeting for Annual General Meeting legally due to be held any time during the year 2020 is extended till 31 December 2021.

b. Due date for the Annual General Meeting for Annual General Meeting legally due to be held any time during the year 2021 is extended till 31 December 2021.

This possible misinterpretation immediately clarified in the second paragraph.

The second paragraph clarifies that no extension is allowed. All these companies should follow legal time-limits or face legal actions.

We consider the circular as an indication of the government understanding of difficulties faced by companies. Same time it clarifies that no extension is coming for AGM missed 31 December 2020 deadline. 

Secondly, the Government is planning a few announcements in the Budget speech. 

The most important take away from the circular is hidden advice: Companies should not take the risk for the year 2021. 

According to the law, any company which missed legal timeline in the year 2020 may opt for compounding but repeated miss in the year 2021. 

I hope the Government will compound the offence of not holding Annual General Meeting timely during the year 2020 with ease.

Government bless us.

[P.S.: I have no interpretation of the font used.]

Aishwarya Mohan Gahrana

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Call for Entries: 8th RMLNLU- Regstreet Law Advisors Conference on International Legal Essay Writing Competition & Conference on Financial Regulatory Laws [March14, 2021]


The Journal Committee (“Committee”) at Dr. Ram Manohar Lohiya National Law University, Lucknow, in collaboration with Regstreet Law Advisors, is organising 8th edition of the RMLNLU International Legal Essay Writing Competition (“RILEC”) along with RMLNLU-Regstreet Law Advisors Conference on Financial Regulatory law on 14 March, 2021.

SUB-THEMES:

  • Regulatory hurdles to the growth of a successful IFSC in india
  • Financial regulations and the innovation in fintech
  • Direct overseas listing
  • Resolution of financial firms
  • Analysis of the stock exchange responses to curb the pandemic caused volatility
  • Social stock exchange
  • Trading member default

ELIGIBILITY:

Authors must be pursuing their 5-year integrated LL.B. (Hons.) course / 3 year LL.B. course / LL.M. from any recognised university in India and equivalent law degree, abroad for the academic year of 2020-2021, to be eligible to participate in the Competition.

STRUCTURE:

All entries will be judged and ranked by the Regstreet Law Advisors and Journal Committee. The last date for submission is 17 January 2021. A maximum of top five entries will be selected for the virtual conference to be organised on 14 March 2021. The participants may adopt any suitable means for presenting the papers including audio-visual aids, such as PowerPoint presentation.

The selected entries will be considered for publication in the next issue of RMLNLU Law Review Journal & the RMLNLU Law Review Blog. The top three essays will be conferred with rewards.

PARTICIPATION GUIDELINES:

  1. Co-authorship of entries (maximum two) among individuals from the same or different institutions is allowed.
  2. Multiple entries for same authors are not allowed.
  3. A participant may submit an entry related to ONE sub-theme ONLY. One may not juxtapose sub-themes in an entry
  4. Entries should be original, unpublished and non-plagiarised.

SUBMISSION GUIDELINES:

  1. Word Limit: 4000-5000 words (excluding footnotes).
  2. Individual Attachments: Name; contact details; current academic status (Year, University etc.); undertaking as to guarantee of originality
  3. Formatting specifications:
  4. Font and size for the essay: Times New Roman | 12
  5. Font and size for footnotes: Times New Roman | 10
  6. Line spacing: 1.5
  7. Citation Style: Uniform style of citation should be followed throughout the essay.
  8. The file name must consist only of the author’s name.
  9. Entries should be emailed to rilec.rmlnlu@gmail.com under the subject title “Entry for 8th RILEC – [Name(s) of Author(s)]” in Microsoft Word (.doc or .docx) format.
  10. The last date for the submission of soft copies is 17th January, 2021.

MISCELLANEOUS RULES:

  1. The copyright for all entries shall vest with the organisers who herewith reserve the right to modify, postpone or defer the competition and its adjudication indefinitely as and when exigencies of an unforeseen nature may arise.
  2. Any attempt, direct or indirect, to contact the panel of judges will be met with the immediate disqualification of the relevant entry.
  3. Any indication of author’s name or university in the entry shall lead to immediate disqualification from the competition.

PRIZES:

  1. Winner – INR 15,000
  2. First Runner Up – INR 10,000
  3. Second Runner Up – INR 5,000

Top three entries will be receiving a ‘certificate of achievement’ and an opportunity to intern at Regstreet Law Advisors.

A ‘certificate of merit’ shall be provided to the selected entries.

Selected entries will be published on ‘The RMLNLU Law Review Blog’.

All participants shall be receiving a ‘certificate of participation’.

CONTACT:

  1. Write us at rmlnlu@gmail.com in case of queries.
  2. You may also reach us through the phone.
  • Agrima Gupta: +91 9810373335
  • Harshit Agrawal: +91 9425429954
  • Anmol Adhrit: +91 8825314318

Click here to know more about the competition.

Click here to read the brochure of the competition.

You can follow us on our Facebook page here.

NEW NORMAL AT NCLT– ONLINE HEARING


The year 2020 is an unprecedented year of unusual era. Technology is helping us to survive. In an earlier post Virtual Reception, Lobby and Meeting Rooms, we discussed the process of online hearing in NCLT and NCLAT. Both Tribunals were till recently hearing urgent matters only. Now, Tribunals are switching to regular cause lists. With new normal, tribunals will hear matters in video conferencing mode.

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Virtual Reception, Lobby and Meeting Rooms


Video conferencing apps are the talk of the earth since COVID-19 lockdown and slowdown. Now Webex, Zoom, Google meet and other such apps are a household name. We all are using these apps for our Board Meetings, General Meetings and court hearings. However, none yet officially recognised WhatsApp as a tool assisting us in the court hearing, but it is doing its role without a celebrity public appearance. 

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Company Website


A company website is not a simple affair of contents, design, SEO and brand building. It is more about compliance. A company may choose not to have a website. Once, a company decide to have a website; it should comply essential requirement of laws.

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Multiple Business Establishments of a Proprietor


Can a proprietor have more than one business establishment? Which law governs sole proprietor business?

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CHANGE OF NAME OF A DIRECTOR


Change of name of a director may happen due to several reasons. A director must register the change in his name under the Companies Act. In this brief post, we will discuss the same.

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EASE AND CHAOS


Ministry of Corporate Affairs has issued many amendment rules and circulars during the month of September 2020 for the ease of doing business. Though one thing always remains – chaos. In this brief post, we will discuss these ease and remaining chaos briefly.  

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FINALLY GENERAL EXTENSION FOR ANNUAL GENERAL MEETING


Just a few days earlier, we made a case here for a general extension for holding Annual General Meeting. The way Government responded through General Circular 28/2020, (presently not accessible) dated 17th August 2020, was not appreciated by Industry and Professional. Now, the Ministry of Corporate Affairs allowed all Registrar of Companies to pass general orders for a general extension for holding Annual General Meeting. Why am I not truly satisfied with these orders?

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Utopia of Investment


During a call with a startup client, we heard the term investor Nth time. “What is a need for investor or investment? It is a self-sufficient business plan.” These days no promoters of startup interested in sales and services but on investment pouring in. They even do not have a plan of servicing of investment which may pour in.
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DENIAL OF GENERAL EXTENSION FOR ANNUAL GENERAL MEETING


We are living in an era of positive presentation. Here is a news headline by a newspaper considered not so sympathetic to the Government: 

Corp affairs ministry allows companies to extend AGMs for up to 3 months

What the Government did? It did not allow any extension as of now. It has not accepted a request to grant a general extension for holding the Annual General Meeting by companies. The Government, in its clarification, mentioned good reason for denial but missed the single and straightforward reason to grant a general extension. We discuss. 

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Share – an abstract God


There is a common property of the God, Rupee and Shares? I replied. The question was how a share look like. Though it may be hard to believe but these three have an ultimate abstract only. You can see an idol of the God or gods, a note of one rupee or more rupees, a certificate of one or more shares, never the God, Rupee and Share (in a normal life). We will discuss a share in following paragraphs.

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WHOLLY OWNED SUBSIDIARIES – SUMMARY OF THE ANTI-THESIS


The Concept of Wholly Owned Subsidiary is an anti-thesis of the concept of the company. At least two persons are required to form a company which is true for wholly-owned subsidiary – but in case of wholly-owned companies one or more registered shareholder declare that one or more beneficial interests in their shares are with a particular company or body corporate.

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NOMINEE OF HOLDING COMPANY!!


Corporate world every holding company having a wholly-owned subsidiary have one or more person as “nominee” shareholders to on record as a registered shareholder holding a nominal number shares in a wholly-owned subsidiary company to satisfy the requirement of the minimum number of members. Treating these registered shareholders as “nominee” is not the perspective of the Company Law but of the Contract Law as applicable to the contract between the company and these shareholders. Let us discuss.

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POWER OF ATTORNEY BY SHAREHOLDERS


I first time wrote on the matter of the power of Attorney in the year 2015 here. Later, I pointed out the option of power of attorney while discussing on draft guidance note on General Meeting on Secretarial Standard on General Meetings (SS-2). I refereed a 92-year-old case law namely Tata Iron & Steel Co. Ltd., In Re., AIR 1928 Bom. 80, which is still considered as a valid reference law for proxies. Nowadays due to Covid-19 related travel restrictions, the requirement of Attorney is being felt in cases where proxies may not be used like in two-person companies. There is a temporary law made through MCA Circulars which allows for a limited period to conduct a general meeting through video conferencing. As the abovementioned post was brief and received many queries.

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Wholly-owned Subsidiary


The concept of the wholly-owned subsidiary is best understood by layman than a young student of law – particularly of corporate law. The concept practically understood by professional dealing with a wholly-owned subsidiary. A student called me to understand this: “how possible?” I replied, “No, It is not possible in true sense.” Unless one understands it clearly that it is not possible in a true legal sense, only then,  you can understand it. Once understood, you will never believe that a wholly-owned subsidiary is not possible in a true legal sense.

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REGISTRATION OF MICRO, SMALL AND MEDIUM ENTERPRISES


Government of India issued a comprehensive notification defining, classifying and registering, Micro, small and medium enterprises superseding four previous notifications including that of 1st June 2020. In this post, we will discuss the notification.

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SECURITIES MARKET – WHAT CHANGED IN 1992?


Guest Post Author: TRISHA SHREYASHI

1992 is a germane year in the history of the Indian securities market but why? That’s something we’ll get to know further in this article paper. From the situation before SEBI Act was legislated to the infamous Harshad Mehta case that led to this legislation to the era post that; all of it has been briefly discussed to give the reader an overview of SEBI Act with regard to (hereafter “w.r.t.”) securities market. Before letting the readers into the details, let’s first get an overview of securities market:-

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SECOND THE RESOLUTION


When I was scripting a proceeding to be held in an extraordinary general meeting, I faced a question of whether proposing or seconding a resolution is required. My answer was NO unless an amendment to the motion is moved. Before reading further, my readers may check legal provision for the moving and passing a resolution under the (Indian) Companies Act, 2013.

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IMPORTANCE OF SUBSCRIBERS TO MEMORANDUM AND ARTICLES OF ASSOCIATION OF COMPANY


Subscribers of a company, particularly of a startup are ignorant tribe as far as company law is concerned. They need proper handholding. A subscriber to the memorandum of association and articles of association of a company is a neglected person though otherwise celebrated as member shareholder of a company.

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