[Anirudh Singh is a 4thyear B.A LL.B (Hons) student of NALSAR University, Hyderabad] When a company is registered on incorporation, it is necessary that it should have a process of deregistration other than by way of winding up. This is so if, after registration, the company does not carry on business. Such process, known as “striking off”, is specified in section 248 of Companies Act...
Resolving Ambiguities in CSR Provisions
[Bunny Sehgal is an Associate at Vinod Kothari & Co. and can be reached at [email protected]] With the enactment of the Companies Act, 2013 (‘Act’), India has become one of the leading countries to mandate spending on corporate social responsibility (‘CSR’) activities through a statutory provision. Since then CSR has become a topic of interest for corporates. Further, with the passage...
Law on Corporate Opportunity: India at Crossroads
[Angad Singh Makkar is a 4th year BA LLB (Hons.) student at Jindal Global Law School in Sonipat, Haryana] The equitable rule of corporate opportunity, which aims to balance the fiduciary duty owed by a director to the company and the director’s serving of individual entrepreneurial interests, has been varyingly applied across several jurisdictions. Most notably, while the courts in the United...
NCLT on Scheme of Arrangement and Tax Avoidance
Background Schemes of arrangement have been a useful method of implementing mergers and acquisitions in the Indian context. Historically under the Companies Act, 1956, schemes were supervised by the High Courts, but the Companies Act, 2013 conferred that jurisdiction upon the National Company Law Tribunal (NCLT). Under the regime set forth in the 1956 Act, the High Courts had adopted a largely...
Reclassification of Non-Compoundable Offences under the Companies Act, 2013: Impact on Section 203
[Radhika Parthasarathy is a 4th Year B.A. LL.B. (Business Law Honours) Student at National Law University, Jodhpur] Introduction The Committee to Review Offences under the Companies Act, 2013, was set up by the Ministry of Company Affairs in July 2018 to recommend the recategorization of acts that have been, for so long, cognizable offences under the Companies Act, 2013 [the “Act”]. The Report of...
Forum for Adjudicating Disputes Regarding Allotment of Shares
The issue of whether a civil court or the National Company Law Tribunal (NCLT) has jurisdiction over disputes regarding allotment of shares in a company came up for consideration before the Delhi High Court in SAS Hospitality Pvt Ltd v Surya Constructions Pvt Ltd. In its order dated 16 October 2018, the Court found that the NCLT has exclusive jurisdiction over such a dispute. The plaintiff, SAS...
Resolving IL&FS: Desperate Times Call for Desperate Measures
[Manaswi Agarwal and Aayush Mitruka graduated from ILS Law College, Pune and are currently working with law firms in Mumbai and Delhi respectively. They can be reached at [email protected] and [email protected]] In a previous post we had analysed the efficacy of the Insolvency and Bankruptcy Code, 2016 (IBC) as compared with the scheme of arrangements mechanism under the...
Impact Analysis of Committee Recommendations on Offences under the Companies Act
[Gaurav Pingle is a practising Company Secretary in Pune and can be reached at [email protected]] The Government of India had constituted a Committee to review the existing framework dealing with offences under the Companies Act, 2013 (‘Act’) and related matters. The Committee was also required to make recommendations to promote better corporate compliance. The Committee submitted its final...
NCLT Approves Amalgamation of LLP with Company: Did the Legislature Intend This?
[Ritika Bharti and Siddharth Subramanya Raj Urs are 4th year B.B.A. LL.B. (Hons.) students at School of Law, CHRIST (Deemed to be University), Bengaluru] Giving a new dimension to corporate restructuring, the Chennai Bench of the National Company Law Tribunal (“Tribunal”), in its first of a kind order dated 11 June 2018, laid down a fresh interpretation to the provisions pertaining to the...
Madras High Court Grants Reprieve to Disqualified Directors
The Madras High Court in Bhagavan Das Dhananjay Das v. Union of India (decided on 3 August 2018 and accessible via Judis) struck down the order of the Registrar of Companies, Chennai (“RoC) which had disqualified a number of directors from their position in various companies. The Court was considering a large group of writ petitions that various disqualified directors had filed before it. In...
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