Vous êtes sur la page 1sur 10

Company law

Minimum numbers of members in a private company : 2 minimum paid up capital in a private company : 1 lakh Minimum numbers of members in a public company : 7 minimum paid up capital in a public company : 5 lakhs maximum numbers of members in private company : 50 maximum numbers of members in public company : No limit If minimum number of members falls below limit : - Up to 6 M company liable for any debt incurred - After that- all members aware of that fact Voting rights ( 177 to 185): 1. By show of hands one member = one vote - Proxy may vote by show of hands if AOA so provides - Proxy no right to speak, but to vote 2. By poll - 1 share 1 vote Proxy no right to speak, but to vote notice period (minimum) : 21 clear days Minimum numbers of directors in a public company : 3 Minimum numbers of directors in a private company : 2 Maximum numbers of directors in a public company: 12 or mentioned in first registered AOA, whichever is higher Minimum numbers of directors in a private company : No Limit maximum numbers of directorships : 15 Statutory General Meeting Section 165 - Only by public co. having share capital - Within 6 month from the date of certificate to commence business ,but not earlier than 1 month - At least 21 clear days notice - Business - special - Documents with notice- statutory report + proxy form +admission card - At any time + any day + at any place ( law silent ) - consequences of default- fine up to Rs. 5000 for every officer in default + Tribunal may also order for compulsory winding up if default in sending SR or in holding SGM - Shorter notice with consent of members holding at least 95% PUC/voting power

AGM
Section 166 to 168 By every company Once in every calendar ( but it would be enough to convene in year of Inc and subsequent year, but not thereafter) Page 1

1st AGM within 18 M of incorporation & within 9 M of end of FY Subsequent AGM- within 15 months of previous AGM and within 6 M of end of FY( ROC may grant extension up to 3 months) Notice atleast 21 clear days Business- ordinary(4)+special At RO or other place within city, town or village in which RO situated + during business hrs + at any day other than public holiday Documents with notice- explanatory statement + proxy form + admission card Shorter notice- with the consent of all members entitled to vote Consequences of default- fine up to Rs. 50000 & Rs. 2500 Per day for company and every officer in default

Appointment of sole selling agent without reserving any condition : void ab initio Maintain index of members when no. of members exceed: 50 Maintain index of debenture holders when no. of debenture holders exceed : 50 Appointment of auditor u/s 224 : OR Appointment of auditor u/s 224a : SR Appointment of first auditor: within 1 month of incorporation by BOD Appointment of subsequent auditors : in AGM by shareholders If auditor not appointed in AGM : CG shall appoint Dividend is paid on paid up share capital Stamp duty is paid on the basis of authorized share capital Called up capital calls in arrears= paid up capital Interest on calls in arrears as per table-a @5% p.a Interest on calls in advance as per table-a @ 6% Maximum underwriting commission on shares @ 5% of issue price or prescribed in AOA , whichever is lower Maximum underwriting commission on debentures @2.5% of issue price or prescribed in AOA, whichever is lower Payment of dividend within 30 days from declaration Declaration of interim dividend by BOD Declaration of final dividend is by Shareholders in AGM Number of scrutineers in case of voting u/s 192a Number of scrutineers in case of voting by poll Quorum in case of private company Quorum in case of public company If dividend not claimed with in ---- number of years from date of transfer to unclaimed dividend account, transfer it to -----a/c A certificate of incorporation is

1 2 2 5 7, investor education and protection fund conclusive evidence Page 2

Contracts before incorporation

- pre-incorporation/Preliminary contracts void-ab-initio - become valid if adopted by co. Contracts after incorporation but before certificate to - provisional contracts commence business - valid from the date of certificate to commence business Promoter defined under ----- section of companies act,1956 not defined Dividend out of capital profits power in AOA + realized CP + left after revaluation of other assets Dividend out of capital not allowed, if allowed it is reduction of capital Interest on capital CG approval Maximum tenure of preference share capital 20 years Dividend an appropriation of profits Interest charge against profit Proceeding of a meeting is recorded in the minutes Any business other than ordinary business is called special business A company whose name has been struck off from the register defunct company of companies Authorities under CG MCA+RD+ROC

Starting of RO
within 30 days of incorporation or certificate to commence business, whichever is earlier - notice to ROC regarding situation of RO- within 30 days of incorporation Change of RO within city BR +notice to ROC Change of RO city to city, but roc changed SR + RD + notice to both ROC change of RO from city to city, roc not changed SR + notice to ROC change of RO from SR + CLB + notice to ROC(30 d ) +permission from debenture holders , state to state creditors change in name CG+SR cg can raise objection on name within ____ year of 1 incorporation reduction in capital SR + Court buyback up to 10% of paid up capital +reserves BR buyback for more than 10% of paid up capital + Reserves SR OR simple majority SR 3 times majority business to be transacted in the meeting agenda presiding officer of the meeting chairman securities bought back should be extinguished within 7 days of completion of bb bb must be completed with in 12 months Page 3 -

maximum premium on issue of shares maximum discount on issue of shares

change in AOA act beyond power act beyond moa act beyond directors but within moa change in object clause OR SR maximum limit u/s 372a up to above limit if above limit exceeded audit committee compulsory u/s 292a if appointment of SSD compulsory, if

directors liable to retire by rotation retiring directors - if AOA requires qualification - max value< Rs. 5000 shares - if single share > Rs. 5000, then hold only 1 share - Tenure- within 2 m of appointment - if not allotted within 2 M - vacate office u/s 272 & u/s 283 appointment of additional - BOD( by BR or circular resolution) directors by - powers in AOA - term- till the ensuing AGM filling casual vacancy - By BOD (only Resolution in BM) irrespective of powers given in AOA - tenure- till the term of dir in whose place he is appointed appointment of government auditor By C and AG of India a company promoting art, science, commerce, social welfare - S- 25 co. or licensed Page 4

no limit 10% + CG+ issue within 2 months of approval + atleast after 1 year from certificate to commence business SR ultra vires void ab initio can be ratified SR simple majority 3 times majority 60%(FR+PUC) or 100% x FR, whichever is higher unanimous BR SR - PUC>5 crore - co.- public - co.- public - PUC>5 crore - no. of SS- > 1000 - SS having shares of NV of <20000 - max. tenure- 3 y >2/3 of total strength >1/3 of above

co. license from cg may or may not have sc may or may not end the name with pvt ltd or ltd cg may revoke license, if T&C violated

an alternate director is appointed by -

BOD (BR or circular resolution) powers in AOA absence of original dir from state > 3 months tenure- till original dir returns to state or original dirs term expires appointment of more than 1 dir by single - pass unanimous res. resolution - then appoint holding of office or place of profit by director - when getting any remuneration over & above the remuneration to which he is entitled as a director 314(1A)S - Dir without R - following covered if their total monthly remuneration is 10000 or more, A. relative of a director B. firm in which director is a partner C. Pvt. Co. in which director is a director or member. either holding company or its subsidiary company 314(1B) following covered if their total monthly remuneration is 50000 or more, A. relative of a director or manager B. firm in which director is a partner C. Pvt. Co. in which director or relative is a director or member. notes: 1. holding and subsidiary not covered 2. directors excluded 3. form for obtaining cg approval e-form 24b CG+SR(both previous approval)

loan to director maximum remuneration under section 198 removal of director u/s 284 special notice

CG 11% of NP SN + or in GM at least 14 days before GM Page 5

ordinary business Dividend declaration + books of a/c +auditor(app)+Dir (app) special business shall always requires SR false, (e.g.- section 224a) disqualification u/s 274(1)(g) while excluding total strength u/s 255, directors to be excluded - nominee director - director u/s 408 - dir appointed by BIFR disqualification u/s 274 - found to be of unsound mind - an undischarged insolvent - applied to be adjudicated as insolvent - court order u/s 203 - convicted in offence involving moral turpitude and imprisonment for more than 6 m & 5 y not elapsed from such conviction - call money due for more than 6 months vacation of office u/s 283 - found to be of unsound mind - applied to be adjudicated as insolvent - court order u/s 203 - convicted in offence involving moral turpitude and imprisonment for more than 6 months - call money due for more than 6 month - not attended 3 consecutive board meeting or for 3 months without leave - failure to acquire qualification shares within 2 m of appointment - removal u/s 284 - default u/s 295 - no disclosure u/s 299 an MD must be a director first yes a manager must be a director first no a person holding substantial powers of company MD a person holding whole or substantially whole powers manager objectives of buy back - increase in EPS - increase in promoter shareholding - to prevent hostile takeover - to achieve optimum capital structure - to return surplus cash to shareholders - to support share price during sluggish market - to provide an additional exit route to shareholders sources of BB Free reserves + security premium + proceeds of new issue prohibition of BB - through subsidiary - Through investment co. - when default in deposit or loan or its interest, dividend, redemption Page 6

Modes of BB

of PS/debt non-compliance u/s 159(AR),207,211(AA) from odd lots from employees from existing SH on proportionate basis from open MKT

proxy - deposit of proxy instrument with co. - 48 hrs before the time for holding meeting or shorter period as per AOA - right to vote, but not to speak unless AOA so provides Recording of minutes Within 30 days of conclusion of meeting Filing of prescribed documents by a foreign company With 30 days from date of establishment in India maximum numbers of partners in a Effects of illegal association firm - cannot enter into any contract - in a banking firm - 10 - cant sue any of its members & outsiders - other than banking firm - 20 - every member personally liable for liabilities - if above limits exceed create incurred company - fine up to Rs. 10000 on members - if not created becomes illegal association Filing of particulars of charge Intimation of payment or satisfaction of any charge in full Filing of particulars of Directors, Manager or Secretary Within 30 days of creation + 30 days (extension) Within 30 days of payment or satisfaction of charge - Form No- 32 - Within 30 days of incorporation PUC > Rs. 5 crore PUC > Rs. 10 Lac but < 5 crore Note- if whole time CS appointed, then no need to get CC - Calling of EGM on requisition by BODwithin 21 days of deposit of requisition - Holding of EGM by BOD- within 45 days of deposit of Page 7

Appoint Whole time CS when Obtain CC from a PCS when

EGM on requisition

Simply speaking, this is a case when a member wants the BOD to convene EGM, and deposit with the company a requisition, now it becomes the duty of BOD to arrange for meeting, if BOD does not do so, requisitionists themselves can convene the

EGM. -

requisition Calling of EGM by requisitionists- within 3 months from the date of deposit of requisition

Book closure ( when Books of members are closed) - Max. period for which register of members can be - 45 days closed in a year - Max period for which register of members can be closed - 30 days at any one time Refund of application Section 69(5) money - in case of non- receipt of minimum subscription within 120 days of date of issue of prospectus - 130 days without interest - After 130 days with interest @ % p.a SEBI guidelines - in case of non- receipt of 90% of issued amount within 60 days from date of closure of issue - 78 days without interest - Beyond 78 days with interest @ 15% Power in AOA On the basis of grounds mentioned in AOA Notice to member must mention1. Accrued amt + interest 2. A day at least 14 days ahead from the date of service of notice on or before which the payment is required to be made BR- must be pass before actual forfeiture of shares

Forfeiture of shares

Basis of distinction Who can issue Power in AOA Prior approval of CG stamp duty Whether negotiable instrument Dividend payment Transfer

Share certificate Any company having share capital Not required not required payable on transfer No To registered holder By registering a proper transfer

Share warrant Public co. Ltd. By shares Required required not payable Yes To bearer of coupons attached to warrants By deliver Page 8

Membership Shares

deed Holder is a member Share certificate can be issued in respect of partly paid up or fully paid up shares -

Holder not a member Share warrant can be issued in respect of fully paid up shares

Bonus shares

Powers in AOA Only to existing shareholders BR recommending its decision to issue BS OR in GM for approving above BR Follow SEBI guidelines (listed co.) Bonus shares = fully PU Sources of Bonus issue- CRR + SP +FR Right shares 81 Can be transferred to other person required yes Fully or partly For cash no Company u/s 2(10) & 3 Corporation = Body corporate u/s 2(7)

Basis of distinction Sections Trf of right

Bonus shares 78+80+205 Can not be transferred to others Application for shares Not required Cash inflow for the no company PU Always fully PU consideration Without consideration Capitalization of yes profits/reserves Corporation vs. company

When court may lift corporate veil - For protection of revenue- when co. making effort to evade tax - For determination of enemy character of co. - Where co. being used for some illegal or improper purpose - Company acting as an agent of shareholders Features of company Transferability Shares freely transferable in case of public company Separate legal entity Separate identity in the eyes of law (read soloman case) Common seal Co. having no limbs so provided with this tool Perpetual succession Members come and go, but company remains Limited liability As per the case Sue and be sued Co. can sue and be sued in its own name Assets Co. can hold assets in its own name Disadvantages of a corporate form of enterprise Page 9

Excessive formalities involving considerable time + money Excessive tax burden income taxable at maximum marginal rate i.e 30% Greater CSR Detailed winding up procedure Dilution in secrecy in business due to excessive statutory disclosure requirements Subsidiary company ( section 4) Composition of BOD controlled by other company or >50% shares with voting rights or voting rights held by other company Unlimited company Liability of members = unlimited i.e personally liable May or may not have share capital AOA mention the no. of members with which co. is being registered.

Page 10

Vous aimerez peut-être aussi