Tag: Companies Act
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Financing Domestic M&A
[Posted by Umakanth Varottil] A Times of India report indicates that the Finance Ministry is considering a proposal to allow banks to finance domestic M&A, i.e. acquisitions of local targets by local acquirers. If this proposal goes through (although significant doubts have been raised regarding that), it will mark a sea-change in the funding of…
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Codification of Directors’ Duties: Is Common Law Excluded?
[Posted by Umakanth Varottil] Background Hitherto, directors had negligible guidance under company law as regards their duties and liabilities. The preexisting Companies Act, 1956 (the 1956 Act) did not explicitly stipulate directors’ duties, which made it necessary to fall back on common law principles (to be articulated by courts while delivering specific decisions). The statutory…
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Guest Post: The Changing Definition of Debentures
[Posted by Umakanth Varottil] [The following post is contributed by Nidhi Bothra of Vinod Kothari & Co. She can be contacted at nidhi@vinodkothari.com] The new Companies Act, 2013 has changed the regulatory face of the corporate India; “raising the bar on Corporate Governance.” The new regulatory changes including need for CSR activities, increased investor protection,…
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Court-Convened Meetings and Postal Ballot
[Posted by Umakanth Varottil] Background In one of the first few cases interpreting the provisions of the Companies Act, 2013 (the 2013 Act), the Bombay High Court last week issued its judgment on the use of postal ballot facility at a court-convened meeting to consider a scheme of arrangement. In re Godrej Industries Limited, the…
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The Meaning of ‘Inability to Pay Debts’ for the Purpose of Winding-up
[Posted by V. Niranjan] The test for statutory winding-up in Indian company law has a long history. Section 434(1)(a) and 434(1)(c) of the Companies Act, 1956 was based on section 223 of the English Companies Act, 1948, and the new Companies Act, 2013, retains this language (see section 271), although the language has been slightly…
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Companies Act, 2013: Directors’ Duties and Liabilities
[Posted by Umakanth Varottil] The NSE Centre for Excellence in Corporate Governance (CECG) has issued its most recent quarterly briefing titled “Directors’ Duties and Liabilities in the New Era”. The executive summary is as follows: – Since directors and the board play a pivotal role in corporate governance, the law foists duties and liabilities on…
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Guest Post: MCA Takes Lawmaking Into Its Own Hands
[Posted by Umakanth Varottil] [The following is a guest post from Vinod Kothari of Vinod Kothari & Co. He can be contacted at vinod@vinodkothari.com] If the Ministry of Corporate Affairs’ (MCA) recent rules, that came a bit too many over a day too less, to replace the nearly 60-year old Companies Act 1956 by the…
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Guest Post: Regulations by SEBI under the Companies Act, 2013 for Promoter Acquisitions
[Posted by Umakanth Varottil] [The following post is contributed by Yogesh Chande, who is a Consultant with Economic Laws Practice, Advocates & Solicitors. Views of the author are personal] In terms of section 13(8) of the Companies Act, 2013 (Act), a company, which has raised money from public through prospectus and has any unutilised amount…
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Further Provisions of Companies Act, 2013 Notified
[Posted by Umakanth Varottil] The Ministry of Corporate Affairs today issued a notification that brings into effect several provisions of the Companies Act, 2013 with effect from April 1, 2014. These include several substantive provisions that would affect the manner in which companies are managed. Normal 0 false false false EN-US JA X-NONE /* Style…
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Guest Post: Directorship in a Company: Cap of Thorns
[Posted by Umakanth Varottil] [The following post is contributed by Nidhi Bothra and Abhirup Ghosh at Vinod Kothari & Co. They can be contacted at nidhi@vinodkothari.com and abhirup@vinodkothari.com respectively] The Companies Act, 2013 (CA, 2013) brings about a sea change in the way the charter guiding corporate India will look like. The existing Act of…