Tag Archives: Corporate Law

Amended Form INC – 22 (W.E.F. 1 May 2015)

Posted on May 6, 2015 | 8 comments

Form INC – 22 is required to be filed pursuant to Section 12 (2) & 12 (4) of the Companies Act, 2013 and Rule 25 and 27 of the Companies (Incorporation) Rules, 2014.

New version of this form came into force from 1st May 2015 by the Companies (Incorporation) Amendment Rules 2015. This replaced earlier version of Form INC – 22 discussed earlier here.

The company is required to furnish to the Registrar verification of its registered office in Form INC – 22 within a period of thirty days from the date of its incorporation. The company can also specify the address of registered office at the time of filing incorporation Forms. For this, the applicant shall upload Form INC-22 as linked form to Form INC-7. In case of One Person Company, the particulars of the registered office address can be filed in Form INC-2 only.  Any change in situation of the registered office thereafter, the company is required to notify to Registrar in Form INC-22 within fifteen days of such change.

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Posted in Chapter II - CA2013, Companies Act 2013

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INTEGRATED INCORPORATION FORM INC – 29

Posted on May 5, 2015 | 7 comments

Form INC-29 deals with the single application for reservation of name, incorporation of a new company and/or application for allotment of DIN. This Form is accompanied by supporting documents including details of Directors & subscribers, MoA and AoA etc. Once the Form is processed and found complete, company would registered and CIN would be allocated. Also DINs gets issued to the proposed Directors who do not have a valid DIN. Maximum three Directors are allowed for using this integrated form for allotment of DIN while incorporating a company.

Select the type of proposed company under drop-down provided. Producer Company should be selected only in case company complies with the provisions of Part IXA of the Companies Act, 1956. Incorporation of a charitable company under section 8 and company defined under chapter XXI of the Companies Act, 2013 are not facilitated under this integrated incorporation form.

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Posted in Chapter II - CA2013, Companies Act 2013

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AMENDMENT IN COMPANIES INCORPORATION RULES

Posted on May 4, 2015 | 3 comments

At the time of writing this blog post, I have no information of publication of the Company (Incorporation) Rules, 2015 which seems to come into effect with effect from 1st May 2015 as Official MCA21 portal has issued all forms prescribed under these forms.

I have no words of advice on enforceability of these rules until copy of publication in official gazette. These Rules come into effect only after publication in official gazette. [Rule 1(1) of the Companies (Incorporation) Amendment Rules 2015]

Penalty:

In original Rule 5 discussed earlier here, penalty in relation to contravention of these rules by One Person Company or its officer was prescribed. Rule 5 of these rules is being deleted.

But penalty is still there. New Rule 7A is introduced for the purpose. I highlight effect in deletion of rule 5 and introduction of rule 7A here:

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Posted in Chapter II - CA2013, Companies Act 2013

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Circular: Deposits under earlier Act

Posted on March 31, 2015 | 3 comments

“Ease of doing business” certainly is a joke invoked once again by the Government on eve of closing of financial year 2014 – 15. Even a fast track professional cannot study implication and advice companies about. This became bigger prank when it is meant to give relief to private companies with lesser resources. As one senior company secretary comments, “This clarification is being given on 30th March, 2015 when many companies have either repaid or have filed petitions with the CLB for extension of time to repay the deposits”. Another professional summarise it as “too little, too late”.

Before reading this well intended circulars, circumstance show this now may help intentional defaulters as law abiding corporate already following some process with almost no scope of reversibility.

Now we may read the general circular 05/2015 issued on 30th March 2015 (afternoon, almost before 36 hours of calendar deadline and just before 12 hours of working deadline).

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Posted in Chapter V - CA2013, Companies Act 2013

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REPORT ON ANNUAL GENERAL MEETING

Posted on March 10, 2015 | 4 comments

This is new feature of Indian Corporate Law. Section 121 of the companies Act 2013 simply says that every listed public company shall prepare a report on each annual general meeting including the confirmation to the effect that the meeting was convened, held and conducted as per the provisions of this Act and the rules made there under. The company shall file with the Registrar a copy of the report within thirty days of the conclusion of the annual general meeting.

Rule 31 of the Companies (Management and Administration) Rules 2014 goes into details.

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Posted in Chapter VII – CA2013, Companies Act 2013, CorpGov, Governance and Responsibility

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AMENDMENT: Administration of CSR

Posted on February 6, 2015 | 5 comments

According to Rule 4(2) of the Companies (Corporate Social Responsiblilty Policy) Rules 2014 as discussed earlier here:

“The Board of a company may decide to undertake its CSR activities approved by the CSR Committee, through a registered trust or a registered society or a company established by the company or its holding or subsidiary or associate company under section 8 of the Act or otherwise:

Provided that—

(i) if such trust, society or company is not established by the company or its holding or subsidiary or associate company, it shall have an established track record of three years in undertaking similar programs or projects;

(ii) the company has specified the project or programs to be undertaken through these entities, the modalities of utilization of funds on such projects and programs and the monitoring and reporting mechanism.”

Now, Ministry of Corporate Affairs came out with the Companies (Corporate Social Responsiblity Policy) Rules 2015 dated 19th January 2015. These amendments shall come into effect from date of publication. After these amendments above mentioned sub – rule (2) of Rule 4 shall be as under:

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Posted in Chapter IX - CA2013, Companies Act 2013, CorpGov, CSR, Governance and Responsibility

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AMENDMENT: COPY OF RESIGNATION OF DIRECTOR

Posted on February 3, 2015 | 1 comment

Rule 16 of the Companies (Appointment and Qualification of Directors) Rules 2014 as earlier discussed earlier here, prescribes where a director resigns from his office, he shall within a period of thirty days from the date of resignation, forward to the Registrar a copy of his resignation along with reasons for the resignation in Form DIR – 11 along with the fee as provided in the Companies (Registration Offices and Fees) Rules, 2014.

The Ministry of Corporate Affairs bring out an amendment to these Rules through the Companies (Appointment and Qualification of Directors) Amendment Rules 2015 dated 19th January 2015. These Rule are applicable from date of publication of these amendment rules in Official gazette.

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Posted in Chapter XI - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility

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COST AUDIT after Amendment Rules 2014

Posted on January 27, 2015 | 1 comment

We have discussed applicability of the Companies (Cost Record and Audit) Rules 2014 as amended by the Companies (Cost Record and Audit) Amendment Rules 2014. Certain companies shall maintain cost record as discussed earlier here. Earlier we have discussed Cost Audit under original Rules before these amendment here.

Applicability of Cost Audit [Rule 4]:

Ever company specified in ITEM (A) of Rule 3, shall get its cost record audited if –

the overall turnover of the company from its products and services during preceding financial year is rupees fifty crore or more, or

the aggregate turnover of the individual product or products or service or services for which cost records are required to be maintained under [item (a) of] Rule 3 is rupees twenty five crore or more. [Rule 4(1)]

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Posted in Chapter X - CA2013, Companies Act 2013

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COST RECORD after Amendment Rules 2014

Posted on January 23, 2015 | 2 comments

The Companies (Cost Record and Audit) Rules 2014 as amended by the Companies (Cost Record and Audit) Amendment Rules 2014 shall be applicable from the date of its publication in official gazette of India and published in official gazette. I am yet to find notification in official gazettee untill 20th January 2015. Earlier we have discussed Cost Record under original Rules before these amendment here.

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Posted in Chapter X - CA2013, Companies Act 2013

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AMENDMENT TO APPOINTMENT AND QUALIFICATION OF DIRECTORS RULES

Posted on January 13, 2015 | 1 comment

Indian Ministry of Corporate Affairs brought an amendment in the Companies (Appointment and Qualification of Directors) Rules 2014 with effect from 18th       September 2014.

Databank:

Now data bank shall not ask for income – tax Permanent Account Number (PAN), [Rule 6(2)(c)]

Only Father’s name will be in record. There will no need for mother’s name and spouse name. I am always of the view there should be option to give name of either of parents on part of person, because law must be gender neutral. [Rule 6(2)(d)]

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Posted in Chapter XI - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility

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THE COMPANIES AMENDMENT BILL 2014: PART 3 OF 3

Posted on January 9, 2015 | 5 comments

The Companies Amendment Bill 2014 has been introduced and passed in Lok Sabha recently. This blog post has intention to analyse proposed changes in the Companies Act 2013.

Most important massage, this amendment prepares a best case for drafting skill development programmes in India. I am reading here this Bill clause by clause. This will be a three part series and part 2 of 3 is present here.

To amend sub-section (1) of section 188 of the said Act to exempt related party transactions between holding companies and wholly owned subsidiaries (WOS) from the requirement of approval of non-related shareholders [Section 16 of the Amendment Bill]

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Posted in Chapter I - CA2013, Chapter XII - CA2013, Chapter XXIX - CA2013, Chapter XXVII - CA2013, Chapter XXVIII - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility

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THE COMPANIES AMENDMENT BILL 2014: PART 2 OF 3

Posted on January 6, 2015 | 5 comments

The Companies Amendment Bill 2014 has been introduced and passed in Lok Sabha recently. This blog post has intention to analyse proposed changes in the Companies Act 2013.

Most important massage, this amendment prepares a best case for drafting skill development programmes in India. I am reading here this Bill clause by clause. This will be a three part series and part 2 of 3 is present here.

To amend sub-section (1) of section 123 of the said Act to include provisions for writing off past losses/depreciation before declaring dividend for the year [Clause 10 of the Amendment Bill]

A forth proviso is being added to the effect that no company shall declare dividend unless carried over previous losses and depreciation not provided in previous year or years are set off against profit of the company for the current year.

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Posted in Chapter I - CA2013, Chapter IX - CA2013, Chapter VIII - CA2013, Chapter XII - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility

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THE COMPANIES AMENDMENT BILL 2014: PART 1 OF 3

Posted on January 2, 2015 | 2 comments

The Companies Amendment Bill 2014 has been introduced and passed in Lok Sabha recently. This blog post has intention to analyse proposed changes in the Companies Act 2013.

Most important massage, this amendment prepares a best case for drafting skill development programmes in India. I am reading here this Bill clause by clause. This will be a three part series and part 1 of 3 is present here.

To amend clauses (68), (71) of Section 2 and Section 11 of the said Act to omit the requirement for minimum paid-up share capital [Clause 2 and 4 of the Amendment Bill]:

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Posted in Chapter I - CA2013, Chapter II - CA2013, Chapter V - CA2013, Chapter VII – CA2013, Companies Act 2013, CorpGov, Governance and Responsibility

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CONVERSION OF PRIVATE COMPANY INTO ONE PERSON COMPANY

Posted on September 23, 2014 | 14 comments

Section 18 of the Companies Act 2013 discussed earlier here talk about conversion of companies. In Rule 7 of the Companies (Incorporation) Rules 2014 list out formalities for conversion of a private company into a one person company.

A private company other than a company registered under section 8 of the Act having paid up share capital of fifty lakhs rupees or less or average annual turnover during the relevant period is two crore rupees or less may convert itself into one person company by passing a special resolution in the general meeting. [Rule 7(1)]

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Posted in Chapter II - CA2013, Companies Act 2013

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CONVERSION OF NON – PROFITS TO FOR PROFIT COMPANY

Posted on September 22, 2014 | 8 comments

We have discussed incorporation of Companies including non – profits under Section 8 of the Companies Act 2013 earlier here. But these companies may require to convert in a for profit company due to various region. There is a provision of conversion of non – profit company to a for profit company under the Rules 21 and 22 of the Companies (incorporation) Rules 2014.

A company registered under section 8 which intends to convert itself into a company of any other kind shall pass a special resolution at a general meeting for approving such conversion. [Rule 21(1)]

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Posted in Chapter II - CA2013, Companies Act 2013

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LICENCE FOR NON – PROFIT COMPANIES

Posted on September 19, 2014 | 1 comment

We have discussed incorporation of Companies including non – profits under Section 8 of the Companies Act 2013 earlier here. In this post we will discuss licence for non profit companies, including new companies or conversion of an existing company into a non – profit.

LICENSE UNDER SECTION 8 FOR NEW COMPANIES WITH CHARITABLE OBJECTS:

A person or an association of persons (hereinafter referred to in this rule as “the proposed company”), desirous of incorporating a company with limited liability under sub-section (1) of section 8 without the addition to its name of the word “Limited”, or as the case may be, the words “Private Limited”, shall make an application in Form INC – 12 along with the fee as provided in the Companies (Registration offices and fees) Rules, 2014 to the Registrar for a license under sub-section (1) of section 8. [Rule 19(1)]

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Posted in Chapter II - CA2013, Companies Act 2013

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SERVICE OF DOCUMENTS

Posted on September 18, 2014 | 3 comments

Section 20 of the Companies Act 2013 discussed earlier here make provision for service of documents for the purpose of this Act.

Service of documents on company

A document may be served on a company or its officer by sending it to the company or the officer at the registered office of the company by registered post or by speed post or by courier service or by leaving it at its registered office or by means of such electronic or other mode as may be prescribed.

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Posted in Chapter II - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility

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CHANGE OF OBJECTS

Posted on September 17, 2014 | 8 comments

According to sub – section (8) of Section 13 of the Companies Act 2013 discussed earlier here, a Company, which has raised money from public and has a unutilised amount out of money so raised, shall not change its objects for which it raised the money through prospectus unless a special resolution is passed by the company.

The prescribed details in respect of this special resolution shall be published in newspapers (one in English and another in local language) which are in circulation at place where registered office of the company is situated. These details shall also be placed on the Website of the company, if any. These details shall indicate the justification for such change in objects of the company.

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Posted in Chapter II - CA2013, Companies Act 2013, Governance and Responsibility

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SHIFTING OF REGISTERED OFFICE OUTSIDE STATE

Posted on September 16, 2014 | 5 comments

Sub – Section (4) and (5) of Section deals with shifting of registered office from one state to another. We have discussed these provisions earlier here.

Any alteration relating to place i.e. state of registered office shall take effect only after approval by the Central Government. The Central Government shall dispose of the application for approval of shifting of registered office from one state to another within sixty days. This alteration should have consent of the creditors, debentures – holders, and other persons concerned with the company. The company should have made sufficient provision for the discharge of all its debts and obligations or adequate security should have been provided for such discharge. This is duty of Central Government, before giving approval of the application to satisfied itself about such consent and such sufficient provision to discharge debts and obligations.

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Posted in Chapter II - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility

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SHIFTING OF REGISTERED OFFICE

Posted on September 15, 2014 | 5 comments

In this post we will discuss, shifting of Registered office –

  1. Within same city, town or village, or
  2. Out side same city, town or village but within same state.

Notice and verification of change of situation of the registered office

In case of change in registered a notice of change duly verified shall be given to Registrar within fifteen days of such change. [Section 12(4)]

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Posted in Chapter II - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility

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