Every individual intending to be appointed as director of a company shall make an application for allotment for Director Identification Number (DIN) to the Central government. [Section 153]
Rule 9 of the Companies (Allotment and Qualification of Directors) Rules 2014 laid down the manner for the Application of Director Identification Number.
Posted in Chapter XI - CA2013, Companies Act 2013, Governance and Responsibility
Tagged ¬Companies (Appointment and Qualification of Directors) Rules 2014, Companies (Incorporation) Rules 2014, Companies Act 2013, Corporate Law, DIN, Director Identification Number, India, Ministry of corporate affairs
A listed company may have one director elected by such small shareholders in such manner and with such terms and conditions as may be prescribed. [Section 151]
“Small shareholders” means a shareholder holding shares of nominal value of not more than twenty thousand rupees or such other sum as may be prescribed.
Rule 7 of the companies (Appointment and Qualification of Directors) Rules 2014
Posted in Chapter XI - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility
Tagged ¬Companies (Appointment and Qualification of Directors) Rules 2014, Companies (Incorporation) Rules 2014, Companies Act 2013, Corporate Law, India, Ministry of corporate affairs, Small shareholders’ Director
According to Section 149 of the Act, every listed company shall have at least one-third of total number of directors as Independent directors. The central government may prescribe minimum number of independent directors in other class or classes of public companies. The Act deals with provisions related to independent directors in details as discussed earlier here.
According to Rule 4 companies (Appointment and Qualification of Directors) Rules 2014, the following class or classes of companies shall have at least two directors as independent directors –
The Companies Act 2013 has gone miles towards its social justice objectives. This includes woman director, independent director and small shareholders directors. We have all these provisions in the Act earlier here. The companies (Appointment and Qualification of Directors) Rules 2014 further elaborate these provisions.
Women Director:
Rule 3 of the companies (Appointment and Qualification of Directors) Rules 2014 elaborate the provision of second proviso of sub – section (1) of Section 149 of the Act. The following class of companies shall appoint at least one woman director –
In an interesting read Pratik Datta point out working of MCA under the Companies Act 2013. Please read:
Within the Central Government, the administration of the Companies Act, 1956, had been entrusted with the MCA through the Government of India (Allocation of Business) Rules, 1961. Interestingly, these Rules have not yet been updated to include administration of Companies Act, 2013 under the purview of MCA.
Section 164 of the Companies Act 2013, as discussed earlier here; deal with Disqualification for appointment of directors. Sub – section (1) of Section 164 list disqualifications of directors for appointment as a director of a company. The Appointment shall include reappointment but not continuation to be in office. Disqualification in this sub – section is general in nature and shall apply for an appointment and reappointment of such director in a company.
Sub – section (2) of Section 164 adds two disqualifications which are applicable to reappointment of director in same company and appointment in any other company for a period of five years from the date on which the said company defaulted and disqualification arises.
Posted in Chapter XI - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility
Tagged ¬Companies (Appointment and Qualification of Directors) Rules 2014, Companies (Incorporation) Rules 2014, Companies Act 2013, Corporate Law, Disqualification of Directors, India, Ministry of corporate affairs
Newly born Indian Corporate Social Responsibility Law is subject to a debate too hot to have it, too tasty politically, socially and economically to avoid it.
In a recent general circular 21 of 2014 dated 18th June 2014, Government of India urged that “the entries in the said Schedule VII must be interpreted liberally so as to capture the essence of the subjects enumerated in the said Schedule.”
Section 120 of the Companies Act 2013 lay down provision for maintenance and inspection of documents in electronic form. This is permitted that any document, record, register, minute etc may be kept in electronic form. The record so kept may be inspected in electronic form. The copy may also be furnished in electronic form.
MAINTENANCE AND INSPECTION OF DOCUMENT IN ELECTRONIC FORM:
Every listed company or a company having not less than one thousand shareholders, debenture holders and other security holders, shall maintain its records, as required to be maintained under the Act or rules made there under, in electronic form. In case of existing companies, data shall be converted from physical mode to electronic mode within six months from the date of notification of provisions of section 120 of the Act. [Rule 27(1)]
Earlier I wrote a long post on Resolution and Minutes under the Companies Act 2013. The Companies (Management and Administration) Rules 2014 supplement these provisions of the Act.
Rule 25 deals with minutes of proceedings of general meeting, meeting of Board of Directors and other meetings and resolutions passed by postal ballot.
There are certain resolution and agreement which are important to have a public notice. Section 117 of the Companies Act lay downs provisions.
A copy of every resolution and agreement in respect of certain matters together with the explanatory statement annexed to the notice calling the meeting shall be filed with the Registrar with thirty days of passing or making.
Section 115 of the Companies Act 2013 requires certain business to be transacted in general meeting only after a special notice of the resolution.
There are certain businesses under the Act and may be some additional businesses in the articles of the company, which requires special notice for resolution. The notice of the intention to move such resolution shall be given to the company by prescribed number of members holding not less than one percent voting power or holding shares of paid – up value of five lakh rupees. On receipt of such notice from these members, the company shall give notice in prescribed manner to its members.
Section 110 of the Companies Act, 2013 creates legal backing for postal ballot.
A company shall transact businesses notified by Central Government through postal ballot only not in general meeting.
Section 109 of the Companies Act 2013 deals with provisions related to demand for Poll in a general meeting.
Where a poll is to be taken, the chairman of the meeting shall appoint necessary number of person to scrutinise the poll process and vote given on the poll and to report thereon. [Section 109(5)]
Rule 21 of the Companies (Management and Administration) Rules 2014 deals with “manner in which the Chairman of meeting shall get the poll process scrutinised and report thereon”.
Posted in Chapter VII – CA2013, Companies Act 2013, Governance and Responsibility
Tagged Annual General Meeting, Companies Act 2013, Corporate Law, Extra Ordinary General Meeting, General Meeting, India, Ministry of corporate affairs, Notice, Proxy, scrutinizer, The Companies (Management and Administration) Rules 2014, voting through electronic means
The Central Government got freehand under Section 108 of the Companies Act, 2013 which simply reads, “The Central Government may prescribe the class or classes of companies and manner in which a member may exercise his right to vote by the electronic means.”
The Rule 20 of the Companies (Management and Administration) Rules 2014 has all power to administer voting through electronic means.
Posted in Chapter VII – CA2013, Companies Act 2013, Governance and Responsibility
Tagged Annual General Meeting, Companies Act 2013, Corporate Law, Extra Ordinary General Meeting, General Meeting, India, Ministry of corporate affairs, Notice, Proxy, The Companies (Management and Administration) Rules 2014, voting through electronic means
Section 105 of the Companies Act 2013 frames law regarding proxies. We have Rule 19 of the Companies (Management and Administration) Rules 2014 to supplement provisions relating to proxies.
Any member of a company entitled to attend and vote at a meeting of the company shall be entitled to appoint another person as a proxy to attend and vote at the meeting on his behalf. [Section 105(1)]
A member of a company registered under section 8 shall not be entitled to appoint any other person as his proxy unless such other person is also a member of such company. [Rule 19(1)]
Posted in Chapter VII – CA2013, Companies Act 2013, Governance and Responsibility
Tagged Annual General Meeting, Companies Act 2013, Corporate Law, Extra Ordinary General Meeting, General Meeting, India, Ministry of corporate affairs, Notice, Proxy, The Companies (Management and Administration) Rules 2014
According to Section 101 of the Companies Act, 2013 a General meeting of a company may be called by giving not less than clear twenty – one days’ notice either in writing (i.e. in paper form) or through electronic mode.
If consent is given in writing or by electronic mode by not less than ninety – five percent of members entitled to vote at such meeting, a general meeting may be called after giving a notice of a shorter period, which is called shorter notice (not short in contents but time period). [Section 101(1)]
Rule 18 of the Companies (Management and Administration) Rules 2014 explains provisions related to notice through electronic mode.
A company may give notice through electronic mode. The expression ‘‘electronic mode’’ shall mean any communication sent by a company through its authorized and secured computer programme which is capable of producing confirmation and keeping record of such communication addressed to the person entitled to receive such communication at the last electronic mail address provided by the member. [Rule 18(1)]
Section 100 of the Companies Act, 2013 lay down law related to Extra – ordinary general meeting called on requisition of members. Rule 17 of the Companies (Management and Administration) Rules 2014 supplements provisions of Section 100 of the Act.
Section 94 of the Companies Act, 2013 prescribes the registers and their indices and the copies of all the returns shall be open for inspection by any member, debenture-holder, other security holder or beneficial owner, during business hours without payment of any fees and by any other person on payment of fees.
Rule 14 of the Companies (Management and Administration) Rules 2014 deals in detail. The registers and indices maintained pursuant to section 88 and copies of returns prepared pursuant to section 92, shall be open for inspection during business hours, at reasonable time on every working day as the board may decide, by any member, debenture holder, other security holder or beneficial owner without payment of fee. The reasonable time is a period of not less than two hours on every working day shall be considered by the company.
Posted in Chapter VII – CA2013, Companies Act 2013, Governance and Responsibility
Tagged Annual Return, Companies Act 2013, Corporate Law, India, Inspection of Register, Inspection of Return, Ministry of corporate affairs, Register of beneficial Owner, Register of Debenture, Register of Members, Register of Other Securities, The Companies (Management and Administration) Rules 2014
{Update: After passing the Companies Amendment Act, 2017, with effect from 14th June 2018 Section 93 of the Companies Act, 2013 and corresponding Rule 13 of the Companies (Management and Administration) Rules 2014, along with its Form MGT – 10 was omitted. These omitted provisions were in force from 1st April 2014 to 13th June 2018.}
According to Section 93 of the Companies Act, 2013, every listed company shall file a return with the Registrar with respect to change in the number of shares held by promoters and top ten shareholders of such company, within fifteen days of the change.
According to Rule 13 of the Companies (Management and Administration) Rules 2014, Every listed company shall file with the Registrar, a return in Form MGT – 10 along with the fee with respect to changes relating to either increase or decrease of two percent or more in the shareholding position of promoters and top ten shareholders of the company in each case, either value or volume of the shares, within fifteen days of such change.
CLOSURE OF REGISTER OF MEMBERS ETC
A company may close its register of members or debenture – holders and other security holders according to Section 91 of the Companies Act, 2013. Rule 10 of the Companies (Management and Administration) Rules 2014 prescribes related procedures.
Posted in Chapter VII – CA2013, Companies Act 2013, Governance and Responsibility
Tagged Companies Act 2013, Corporate Law, India, Ministry of corporate affairs, Register of beneficial Owner, Register of Debenture, Register of Members, Register of Other Securities, The Companies (Management and Administration) Rules 2014
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