Tag: Company Law
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Director and Officer Liability for Dishonour of Cheques
[Posted by Umakanth Varottil] (The following post has been contributed by Avirup Bose. Avirup is an Indian lawyer, who has graduated from NUJS Kolkata and has an LL.M from the Harvard Law School) On July 6, a Division Bench of the Supreme Court passed a judgment in K.K. Ahuja v. V.K. Vora (MANU/SC/1111/2009, per R.V.…
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NCLT: Still Awaiting a Verdict
[Posted by Umakanth Varottil] Although the establishment of the National Company Law Tribunal (NCLT) was envisaged through an amendment to the Companies Act nearly 7 years ago, it is yet to see the light of day. The NCLT is expected to take over the role of the High Court and the Company Law Board pertaining…
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SEBI’s Recent Primary Market Reforms
[Posted by Umakanth Varottil] SEBI last week announced a slew of reforms to the primary capital markets. The key reforms are as follows: Anchor InvestorsThe concept of “anchor investors” has been introduced in public issues whereby 30% of the institutional (QIB) portion will be allocated to anchor investors on a discretionary basis. This is to…
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Duties of the Official Liquidator: Madras HC decision
[Posted by Mihir Naniwadekar] A recent judgment of the Madras High Court throws some light on the role of an Official Liquidator. In TCI Distribution Centers v. Official Liquidator (C.A. 1953/2008 in C.P. 526/2000), the Official Liquidator had sold certain properties through an auction-sale. The auction-purchaser later found out that the properties were not exactly…
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Electoral Verdict to Spur Reforms
[Posted by Umakanth Varottil] With the return of the Congress government to power and with Dr. Manmohan Singh set to continue as Prime Minister, corporate India is likely to witness a series of reforms in the near future. Unlike the previous stint where the Government was hamstrung by coalition politics (but nevertheless achieving a record…
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A Call for Greater Shareholder Rights under U.S. Law
[Posted by Umakanth Varottil] The proposed Shareholder Bill of Rights Act of 2009 in the U.S. that comes in the wake of the financial crisis gives rise to an important debate regarding the rights of shareholders in companies. The rationale for the Bill is the perceived failure of corporate governance that led to the crisis.…
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Demystifying concepts and terms used in agreements
[Posted by Satyajit Gupta] My colleague, Daksh Trivedi has recently written an interesting article in The Mint, where he has discussed the various legal concepts/ terms used in shareholders and share purchase agreements. He begins with: Typical documents used for capturing terms of equity investments, that is, share-purchase agreements or shareholders’ agreements, are now complex…
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RTI and the Corporate Sector
[Posted by Umakanth Varottil] The Right to Information Act, 2005 has been successful in inducing transparency in the decision-making process of the government. However, it has been reported, quoting the Chief Information Commissioner, that the there is a need for the concept of right to information (RTI) under the Act to be “directly applicable to…
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Differential Voting Rights: Ruling by CLB
[Posted by Umakanth Varottil] 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…
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NCLT and NTT: Questions of “Intrinsic Judicial Functions”
[Posted by Mihir Naniwadekar] 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.…