Tag: Company Law
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Differential Voting Rights: Ruling by CLB
Several months ago, we had mentioned that the validity of shares with differential voting rights (DVRs), particularly as a defence against takeovers, was challenged before the Company Law Board (CLB) in the Jagatjit Industries Case. Today’s Economic Times reports that the CLB has passed its order upholding the resolution to allot shares with DVRs to
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NCLT and NTT: Questions of “Intrinsic Judicial Functions”
Recently, a Constitution Bench of the Supreme Court (headed by Balakrishnan C.J.) finished hearing arguments on the constitutionality of the proposed National Company Law Tribunal (NCLT), and judgment has been reserved. The matter arose out of an appeal against a Madras High Court decision in R. Gandhi v. Union of India. The principal challenge to
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Securitisation and Debt Recovery – A Centre-States Conflict?
The Constitution has devised an elaborate scheme of distribution of legislative powers, and the competence of a legislature to enact a law has normally been challenged by a private citizen to whom the law applies. The latest battleground looks to be the fairly recent structure of securitization, debt recovery and other FI-friendly legislation. The first
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Proposal for Uniform Par Value on Shares
In a previous post, we discussed the difficulties posed by the current system of par value of shares whereby companies are free to determine the par value of their shares. Some of these difficulties will be addressed in SEBI’s proposal to create a uniform par value system for all listed companies. However, the current proposal
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Proposal for “Golden Share”
Business Standard reports that the Government is considering investing in the “golden share” in infrastructure projects. The report states: “The “golden share”, which will be owned by the government, will ensure that it has a say in all major decisions taken by the private concessionaire. It will also obviate the need for the government to
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Companies Bill, 2008: No advisory services by auditors
One of the important measures taken in the Companies Bill, 2008 is to prevent Chartered Accountants from offering actuarial, advisory and management services to companies which have engaged them as statutory auditors. Section 127 of the Bill provides: An auditor appointed under this Act shall provide the company only such other services as are approved
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Shares and Stocks: India and Delaware
India has largely followed the scheme of the erstwhile British company law in enacting the Companies Act, 1956. This is true even in the case of share capital structures that companies can have, such as only two types of shares, preference shares and equity shares for public limited companies, and also restrictions on companies dealing
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Ceiling on Executive Pay
In previous posts, we had highlighted significant differences between the law on executive pay in the US and in India, and how the Indian regime may be more conducive to preventing excesses by corporate executives. In the US, the position is as follows: Excessive managerial influence also extends to fixing managers’ own remuneration. In a
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Lifting the Corporate Veil for Tort Claims
As we have seen previously (here and here), the law relating to lifting of the corporate veil is not only ridden with several ambiguities, but also that courts are generally slow to lift the corporate veil. This holds true even in cases that involve mass torts against subsidiaries of large corporate groups where such subsidiaries
