Subordinate legislation should avoid repeating a provision of the main legislation. Sub-rule (3) of rule 5 of the Companies (Share Capital and Debentures) Rules, 2014 is a good example. Rule 5(3) corresponds to Section 46 of the Companies Act, 2013. Section 46 was amended by the Companies Amendment Act, 2015 with effect from 29th May 2015. Correspondingly, Schedule I of the Companies Act, 2013 also amended this time in the line of these amendments in Section 46. Due to oversight, there was no corresponding amendment in Schedule since 29th May 2015. Now, corrective action is taken by with effect from 10th April 2018.
Tag Archives: Share Certificate
The Ministry of Corporate Affairs placed here on its website a draft of the Companies (Share Capital and Debentures) Second Amendment Rules, 2015. These amendment Rules will come into force from the date of its publication in Official Gazette.
These amendment rules proposed to amend Rule 5(3) of the Companies (Share Capital and Debentures) Rules, 2014. Earlier this sub – rule was amended in 18th March 2015 by the Companies (Share Capital and Debentures) Amendment Rules, 2015. Before comment, I read this copy of amended Rule 5(3), with amendment by this amendment rule in bold letters:
We have discussed Section 46 of the Companies Act, 2013 which deals with Share Certificates earlier here.
Rule 7 of the Companies (Share Capital and Debentures) Rules 2014 makes detailed provision for this purpose.
In last post, we discussed certificate of share and procedure for issuing fresh share certificates. Sometime, a company need to renew a certificate or issue a duplicate one.
According to Section 46 discussed earlier here, a duplicate certificate of shares may be issued, if such certificate —
(a) is proved to have been lost or destroyed; or
(b) has been defaced, mutilated or torn and is surrendered to the company.
If a company with intent to defraud issues a duplicate certificate of shares, the company shall be punishable with fine which shall not be less than five times the face value of the shares involved in the issue of the duplicate certificate but which may extend to ten times the face value of such shares or rupees ten crores whichever is higher and every officer of the company who is in default shall be liable for action under Section 447.
Rule 6 of the Companies (Share Capital and Debentures) Rules 2014 discusses issue of renewed or duplicate certificate.
A certificate, issued under the common seal of the company, specifying the shares held by any person, shall be prima facie evidence of the title of the person to such shares. We have discussed Section 46 of the Companies Act, 2013 dealing with share certificates earlier here.
Issue of Share Certificates:
Where a company issues any share capital, no certificate of any share or shares held in the company shall be issued, except –