No. In this post, I am not discussing any existing law. This a proposal I received in form of a query on Quora about registration of a temporary company. I received another query, how India registered so many “paper companies”.
The law stated in this post is valid from 19th February 2019. The earlier post on the subject here was valid from 1st April 2014 till 18th February 2019.
Section 454 of the Companies Act 2013 discussed earlier here, deal with the adjudication of penalties. This Section is supplemented by the Companies (adjudication of Penalties) Rules 2014. This Section was amended by the Companies (Amendment) Ordinance, 2018 and Its retained as amended by first and Second Company amendment Ordinances of the year 2019. Accordingly, the Companies (adjudication of Penalties) Amendment Rules 2019 substituted Rule 3 of the Companies (adjudication of Penalties) Rules 2014. In this post, we will discuss these amended provisions.
The Companies Act, 2013 like most other laws dealing with offences did not have any scheme to determine the level of punishment. This is always the discretionary power of a court to determine a punishment within minimum (if any) and maximum punishment provided under law. Presently, the legislature and executives of the country want to control discretionary powers of the third organ – judiciary to all possible extent. Though discretion may result in higher corruption, subordinate courts governed by precedents and do very little use of discretion. The companies Amendment Act, 2017 introduces new Sections 446A to guide the discretionary powers. Amount of fine and/or imprisonment also reduced in several cases.
Posted in Chapter XXIX - CA2013, Chapter XXVIII - CA2013, Companies Act 2013
Tagged 446A, 446B, Fraud, Punishment
Disqualification of directors certainly is a hot topic among professionals practising corporate laws. Irrespectively of popular perception, the list compiled and released by Ministry of Corporate Affairs does not confer any disqualification to any director. These directors were already disqualified. In a serious violation, many of these directors might have failed to communicate about their disqualification to companies appointing or reappointing them after the actual date of disqualification. Such failure has penal consequences. This blog post will discuss serious consequences of the failure of compliance with law and procedures after incurring disqualification by a director.
Compliance way or Confine way! The Government made it clear. Directors who were on a long-term picnic after removal of names of their “shell companies” are now offered sleepless nights. I appreciate.
Ministry of Corporate Affairs issued two important lists in this regard –
Posted in Chapter IX - CA2013, Chapter XI - CA2013, Chapter XVIII - CA2013, Chapter XXIX - CA2013, Companies Act 2013
Tagged Annual Accounts, Annual Filing, Annual Returns, Disqualified Director, National Company Law Tribunal, Registrar of Companies, Removal of Name, Restoration of Companies, Shell Companies, Strike – off companies, Winding Up
Government of India delegates its powers time to time to subordinate offices for better implementation of law. Section 458 of the Companies Act, 2016 confers power of such power of delegation in relation to the provision under the Act to the Government of India. Government of India issued notification S.O. 4090(E) dated 19th December 2016 regarding delegation of powers to Regional Directors, which came into effect from that date.
A notification issued by Ministry of Corporate Affairs notified section 255 of the Insolvency and Bankruptcy Code, 2016. By virtue of notification of Section 255 of Insolvency and Bankruptcy Code, 2016; the Companies Act, 2013, stands amended in accordance with Schedule XI of the IBC2016 with effect from 15th November 2016. We shall have a short discussion here.
Posted in Chapter I - CA2013, Chapter II - CA2013, Chapter IV - CA2013, Chapter VI - CA2013, Chapter VII – CA2013, Chapter XIV - CA2013, Chapter XIX -CA2013, Chapter XV - CA2013, Chapter XVIII - CA2013, Chapter XX - CA2013, Chapter XXI - CA2013, Chapter XXIX - CA2013, Chapter XXVII - CA2013, Companies Act 2013
Central Government by a notification published in Official Gazette on 18th May 2016 appointed the 18th day of May, 2016 as the date on which the provisions of clause (iv) of sub-section (29) of section 2, sections 435 to 438 (both sections inclusive) and section 440 of the Companies Act, 2016 shall come into force. These provisions deal with Special Courts under Chapter XXVIII of the Companies Act, 2013. Even though, we have already discussed these provisions originally earlier here and with amendment here, it may be beneficial to have these notified sections in this post again.
Posted in Chapter XXIX - CA2013, Chapter XXVIII - CA2013, Companies Act 2013
Tagged Special Court
On 5th June 2015, Ministry of Corporate Affairs posted here a draft notification to be published in Official Gazette announcing some exemption to Not for profit Companies.
As there is no effective date is announced in the Notification, this notification shall come into effect on the date of its publication in the Official Gazette.
[UPDATE 19th June 2015: MCA uploaded copy of Official Gazette dated 5th June 2015, in which this Notification is published. Meaning that; These exemption came into force from that date.]
The Notification is issued in exercise of power conferred by Clauses (a) and (b) of Sub – section (1) and sub – section (2) of 462 read with Section 8 of the Companies Act, 2013. A copy of this notification has been laid in draft before both Houses of Parliament as required by sub-section (2) of section 462 of the Companies Act, 2013.
Paragraph 2 of the Notification cast a condition on the Not for Profit Companies:
On 5th June 2015, Ministry of Corporate Affairs posted here a draft notification to be published in Official Gazette announcing some exemption to Nidhi Companies.
As there is no effective date is announced in the Notification, this notification shall come into effect on the date of its publication in the Official Gazette.
[UPDATE 19th June 2015: MCA uploaded copy of Official Gazette dated 5th June 2015, in which this Notification is published. Meaning that; These exemption came into force from that date.]
The Notification is issued in exercise of power conferred by Clauses (a) and (b) of Sub – section 462 read with Section 406 of the Companies Act, 2013. A copy of this notification has been laid in draft before both Houses of Parliament as required by sub-section (2) of section 462 of the Companies Act, 2013.
Paragraph 2 of the Notification cast a condition on the Nidhi Companies:
Sub – section (5) (6) and (7) of Section 454 of the Companies Act 2013 discussed earlier here, deal with adjudication of penalties. This Section is supplemented by the Companies (adjudication of Penalties) Rules 2014.
Any person aggrieved by an order made by the adjudicating officer may prefer an appeal to the Regional Director having jurisdiction in the matter. [Section 454(5)]
Section 454 of the Companies Act 2013 discussed earlier here, deal with adjudication of penalties. This Section is supplemented by the Companies (adjudication of Penalties) Rules 2014.
The Central Government may by an order published in the Official Gazette appoint Adjudicating Officers for adjudicating penalty under this Act. [Section 454(1)]
The Central Government issued the Company Law Settlement Scheme 2014 [CLSS-2014] in exercise of power conferred under Section 403 and 460 of the Companies Act, 2014.
Scheme aims to support companies to complete annual filing or got declare themselves dormant.
The Scheme shall be in force from 15th August 2014 to 15th October 2014. Under the scheme any defaulting company may file documents which were due for filing till 30th June 2014. The defaulting company shall pay statutory filing fees along with additional fees of 25% of the actual additional fee payable.
In this post, we will discuss three miscellaneous rules from the Companies (Miscellaneous) Rules 2014. Rule 9 and 10 are originally in these Rules. Rule 11 is inserted with effect from 17th July 2014.
Fees for application to Central Government
For the purposes of sub-section (2) of section 459, every application which may be, or is required to be, made to the Central Government under any provision of the Act-
We have discussed in earlier post here, where a company is formed and registered under this Act for a future project or to hold an asset or intellectual property and has no significant accounting transaction, such a company or an inactive company may make an application to the Registrar in such manner as may be prescribed for obtaining the status of a dormant company.
The Companies (Miscellaneous) Rules 2014, for the purposes of sub-section (1) of section 455, a company may make an application in Form MSC-1 along with such fee as provided in the Companies (Registration Offices and Fees) Rules, 2014 to the Registrar for obtaining the status of a Dormant Company in accordance with the provisions of section 455 after passing a special resolution to this effect in the general meeting of the company or after issuing a notice to all the shareholders of the company for this purpose and obtaining consent of at least 3/4th shareholders (in value). [Rule 3 of the Companies (Miscellaneous) Rules 2014]
This work is licensed under a Creative Commons Attribution-NonCommercial 3.0 Unported License.
AishMGhrana 