Category Archives: Companies Act 2013

Post written on the provisions of the (Indian) Companies Act, 2013 and matter incidental thereto

COMPANY UNDER IEPF RULES


Since the introduction of Investor Education and Protection Fund (IEPF) in the year 2001, I have a keen interest in the law related to investor protection, particularly under the Companies Law. Presently, one of the significant but neglected features of the IPEF Rules is the definition of the Company. The definition has been amended several times to keep track of silent changes of several laws without much notice of the stakeholder.

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DECLARATION OF NIDHI


On 31st July 2019, the Companies Amendment Act, 2019 was notified. The Companies Amendment Act, 2017 is still being implemented. Earlier, the Notification S.O. 2269 (E) dated 1st July 2019 appointed 15th August 2019 as the date on which the provisions of section 81 of the said Act shall come into force. Accordingly, on this 15th August 2019, Section 406 of the Companies Act, 2013 stand replaced by another old school enactment of the law. Brief Discussion on U-turns.

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KASHMIR AND THE COMPANIES ACT


The Monday 5th August 2019 witnessed a powerful and joyful celebration of Indian Unity and also an unfortunate revelation of various misconceptions of minds of thousands of Indians. Social media witnessed the flow of social and legal bias established by the most lethal weapon of human history – the half-knowledge. Soon, overflowing sentiments overpowered the knowledge, understanding and interpretation even of well dignified professional minds.

A section of professionals claimed that the Indian Companies Act, 2013 shall now be applicable to state (now Union Territory) of Jammu and Kashmir. Strange!!

We will try to remove the misconception of mind here.

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FORM DIR-3-KYC-WEB


To bring 12th Amendment to the Companies (Appointment and Qualification of Directors) Rules, 2014, Ministry of Corporate Affairs on 25th Day of July 2019 notified the Companies (Appointment and Qualification of Directors) Third Amendment Rules, 2019 [Notification No. by GSR528(E)]. This amendment introduced a new Form DIR – 3 – KYC – WEB for annual confirmation of KYC submitted earlier. We, in this post, will discuss new provisions along with the Companies (Registration Offices and Fees) Rules, 2014.

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Provident Fund/ Pension/ Gratuity is not part of Liquidation Estate


Guest Post: Adv. Nitin Kumar Kaushik (Kaushik Insolvency Professionals)

Numbers of Insolvency Professionals or Liquidators are facing the problem with respect to whether the Provident Fund/Pension Fund/Gratuity Fund is part of liquidation estate or not under Section 36 of the Insolvency and Bankruptcy Code, 2016 “IBC”. Generally, what happens, the Company had deducted the amount, in the form of provident fund or pension fund or gratuity amount, from the salary of the employee/workmen and then did not deposited or failed to deposit in the account of Employees Provident Fund Organisation “EPFO” or Pension Fund Organisation “PFO”. Thereafter, the government department i.e., EPFO or PFO attached the property of the Corporate Debtor in respect of dues of provident fund or pension fund or gratuity amount on the Corporate Debtor, even the attached property already mortgaged with any of the financial institutions or not.

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APPLICABILITY FORM NFRA – 1


To file or not to file NFRA – 1 still a puzzle. It seems thumb rule, if you as body corporate file Form ADT-1, do not file NFRA – 1. We will try to understand the NFRA Rules, 2018, NFRA FAQs and the Form NFRA – 1.

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Form BEN-1


Form BEN  – 1 is a declaration by the beneficial owner who holds or acquires significant beneficial ownership in shares [Pursuant to section 90(1) of the Companies Act, 2013 and rule 2A and rule 3. Many readers requested its actual and understandable copy. I place it hereunder:

Form No. BEN-1

Declaration by the beneficial owner who holds or acquires significant beneficial ownership in shares [Pursuant to section 90(1) of the Companies Act, 2013 and rule 2A and rule 3]

 

To,

Name of the company: ____________________

Registered office address:_______________

 

1. Purpose of filing the form (choose anyone)

  • For the declaration of Significant Beneficial Ownership under Section 90:
  • For Change in Significant Beneficial Ownership under Section 90 :

ID of the Significant Beneficial Owner: (To be allotted by MCA after filing form BEN – 2 first time by reporting company, same will be used for subsequent filings, therefore leave for the first time filling)

  1. Particulars of the holder of the significant beneficial interest:
Name of the Significant Beneficial Owner (Given name and last Name)  
Address and Email id  
Date of Birth/Age  
Father’s/ Mother’s/Spouse’s name  
Occupation  
Nationality  
Passport No. (in case of foreign national)  

 

  1. Nature of indirect holding or exercise of the right in the reporting company through a member of the reporting company (where more than one repeat this para 3 of the Form)

Through Member 1

(a) Type of Member (Company/ LLP/Any other Body Corporate/HUF/ Partnership Firm/Discretionary Trust/Charitable trust/Specific Trust/Revocable Trust /Pooled Investment vehicle (PIV) / Entity controlled by PIV):

(b) Corporate Identity Number (CIN) or Limited Liability Partnership Identification Number (LLPIN) or any other registration number allotted by the regulator established under the Act:

(c) Name of the Member:

(d) Address:

(e) Nature of indirect holding or exercise of the right in the reporting company:

* By virtue of shares

* By virtue of voting rights in shares

* By virtue of rights on distributable dividend or any other distribution

* By virtue of the exercise of control (attach a copy of the agreement)

* By virtue of the exercise of significant influence (attach a copy of the agreement)

(f) Status of significant beneficial owner in the member of the reporting company (choose anyone):

* Individual in case of a company or any other body corporate

* Partner in case of partnership firm or LLP

* Karta in case of HUF

* Trustee in case of a discretionary trust or charitable trust

* Beneficiary in case of a specific trust

* Author or settlor in case of a revocable trust

* General Partner, Investment Manager or CEO in case of pooled investment vehicle or entity controlled by a pooled investment vehicle

(g) In case the member is a partnership firm or LLP, specify whether significant beneficial owner:

* is a partner holds

* majority stake in the body corporate partner

* holds the majority stake in the ultimate holding company of the body corporate partner

(h) In case the member is a company or any other body corporate, specify whether the significant beneficial owner holds:

* majority stake in such company or body corporate

* majority stake in the ultimate holding company of such company or body corporate

(i) Whether Significant Beneficial Owner has any direct holding or right in the reporting company:

* Yes                                                                                    * No

If yes, enter details below:

*By virtue of shares                        %

* By virtue of voting rights in shares                        %

* By virtue of rights on distributable dividend or any other distribution                   %

* By virtue of the exercise of control (attach a copy of the agreement)

* By virtue of the exercise of significant influence (attach a copy of the agreement)

<<Through Member 2

Repeat Para 3 again for member 2 and so on till all member though whom the significant beneficial owner has significant beneficial ownership exhausted>>

 

Date:

Place:

Signature of the holder of the significant beneficial interest

Attachments:

1.
2.
3. etc etc

 

Please note, where the Significant Beneficial Owner is aware and cooperating, she will fill and submit the form BEN – 1 by her own. Otherwise, the secretarial department of the reporting company shall dig layers of its all non-individual members and calculate holdings of all individuals behind these non-individual members.

Please also note, to get the true result, please do not ignore any individual behind any non-individual member because Significant beneficial owner may be hidden behind more one or even 100 non-individual members. MCA has given 10% holding limit to help reporting companies and save their time. Sometimes, we need to be thankful to MCA.

CS Aishwarya Mohan Gahrana

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