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Historical Preview Necessity of New Law Committee Report Concept Paper Highlights-Companies Bill 2011 What's New & Modified Old vs New Law
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Under this section, we have made comparison between the Companies Bill 2011 and Companies Act 1956 on various topics under different chapters of the bill. This section , can you help you in finding out in quick manner, the changes in the new or old law. Please click the relevant chapter, to read the comparison . Chapter -II - Incorporation of Company and matters incidental thereto Chapter III - Prospectus and allotment of securities
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Chapter -IV - Share Capital and Debentures Chapter V - Acceptance of Deposits by Companies Chapter VI - Registration of Charges Chapter VII - Management and Administration Chapter VIII - Declaration and Payment of Dividend Chapter IX - Accounts of Companies Chapter X - Audit and Auditors Chapter XI - Appointment and Qualification of Directors Chapter XII - Meetings of Board and its Power Chapter XIII - Appointment and Management of Managerial personnel Chapter XV - Compromise, Arrangements and Amalgamations Chapter XVI - Prevention of Oppression and Mismanagement Chapter XIX - Revival and rehabilitation of Sick Companies Other Chapters
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Voting Rights
Classifications between cumulative and non cumulative preference shares for purpose of identification of voting rights has been dispensed with Preference shareholders
The preference shares were classified between cumulative and non cumulative preference shares for purpose of identification of voting rights. In case of cumulative preference shares if the dividend has remain unpaid for an aggregate period of not less than 2 years preceding the date of commencement of meeting
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Companies Act
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can exercise such voting rights only when dividends payable in respect of a class of preference shares are in arrears for a period of 2 years or more
Application of Premium
Premium may be utilized for Issue of unissued shares of the company as fully paid bonus shares Writing off preliminary expenses
Premium may be utilized for Issue of unissued shares of the company as fully paid bonus shares
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writing off the expenses of, or the commission paid or discount allowed on, any issue of shares or debentures of the company providing for the premium payable on the redemption of any redeemable preference shares or of any debentures of the company purchase of its own shares or other securities
writing off the expenses of, or the commission paid or discount allowed on, any issue of shares or debentures of the company
providing for the premium payable on the redemption of any redeemable preference shares or of any debentures of the company
Additional provision has been provided for certain Companies to be prescribed whose financial statement comply with the accounting standards prescribed for such class of companies.
Company cannot issue shares at discount other than as sweat equity, no provision has been provided for any approval under the Companies Bill. A Company having share capital proposes to increase its subscribed capital by the issue of further shares, such shares apart from existing shareholder may also be offered to employees by way of ESOP subject to approval of shareholders by way of special resolution and complying with such other conditions as may be prescribed. In case of ESOP allotment, either in cash or for consideration other than cash, the price shall be arrived on the base of the report of the registered valuer subject to
A company may issue shares at a discount subject to the conditions specified and approval of the Central Government
ESOP
Provision for ESOP has been dealt under Unlisted Public Companies (Preferential. Allotment) Rules, 2003
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Companies Act
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Bonus Shares
Company may issue fully paid-up bonus shares to its members, in any manner whatsoever, out of its free reserves, securities premium account or the capital redemption reserve account subject to the conditions provided therein. Sweat Equity cannot be granted to employee of subsidiary company incorporated outside India Company may issue preference shares redeemable after 20 years for such infrastructure projects as may be specified subject to redemption of specified % of preference shares on annual basis at the option of the preference shareholder The provisions of clause related to further issue of capital will now be applicable to all types of Companies. No time limit has been prescribed, Company can anytime increase its share capital by issue of further shares Provision introduced for offer of shares to employees for ESOP Prescribed Conditions have to be followed when a company proposes to increase its subscribed capital by offering the same to existing shareholders
Provision for bonus issue has been dealt under the Companies Act, 1956
Sweat Equity
Sweat Equity was allowed to be granted to employee of subsidiary company incorporated outside India
No Company limited by shares shall issue any preference shares which is redeemable after the expiry of a period of 20 years from the date of issue.
Private Companies are out of the preview of provisions of further issue of Capital.
Submit Such provision shall be applicable 8 Now at any time after the expiry of two years from the formation of a company or at any time after the expiry of one year from the allotment of shares in that company made for the first time after its formation, whichever is earlier.
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No direct provision for ESOP, company may issue shares to employees in the category of other persons not being members of the Company by way of special resolution.
No reduction of capital will be allowed if the company is in arrears for payment of deposits, accepted either before or after the commencement of this Act. The tribunal will give notice of the application of the reduction of the share capital to the Central Government, SEBI (in case of the listed company) and every creditor. If no representation is received then it shall be presumed that there is no objection.
No provision was mentioned in the act for asking the representation from Central Government, SEBI for reduction of share Capital
The time period for issue of share or any other certificates is 2 months in case of allotment of shares, 1 month in case of transfer and transmission and 3 months in case of allotment of debentures A company can make buyback even if any default regarding repayment of deposit or interest payable thereon, redemption of debentures or prefer-
The time period for issue of share or any other certificates is 3 months in case of allotment of shares, 2 months in case of transfer and transmission and 6 months in case of allotment of debentures.
A company cannot make buyback if default regarding: repayment of deposit or interest payable thereon, redemption of debentures or preference shares or
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Companies Act
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ence shares or payment of dividend to any shareholder or repayment of any term loan or interest payable thereon to any financial institution or bank
payment of dividend to any shareholder or repayment of any term loan or interest payable thereon to any financial institution or bank
is subsisting
Debenture Trustee
have been remedied and a period of 3 years must have lapsed after such default ceased to subsist The Company is required to appoint debenture trustee only when the company issues prospectus or make an offer or invitation to the public or to its members exceeding five hundred for the subscription of its debentures In case where the Company is unable to discharge the principal amount as and when it becomes due, than the debenture trustee may file a petition before the Tribunal
The Company is required to appoint debenture trustee when the company issues prospectus or make an offer or invitation to the public, irrespective of the number. In case where the Company is unable to discharge the principal amount as and when it becomes due, than the debenture trustee may file a petition before the Central Government
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