DEC 08, 2016

Commencement of provisions of Companies Act, 2013 and other related updates

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MCA vide Notification No. S.O. 3677(E) dated December 07, 2016, has enforced the provisions of the following sections of the Companies Act, 2013 w.e.f 15.12.2016:-

S. No. Sections Particulars
1. Clause (23) of section 2 Definition of Company Liquidator
2. Clause (c) and (d) of sub-section (7) of section 7 Incorporation of company
3. Sub-section (9) of section 8 Formation of companies with charitable objects, etc.
4. Section 48 Variation of shareholders’ rights
5. Section 66 Reduction of share capital
6. Sub-section (2) of section 224 Actions to be taken in pursuance of inspector’s report
7. Section 226 Voluntary winding up of company, etc., not to stop investigation proceedings
8. Section 230 [except sub-section (11) and (12)] Power to compromise or make arrangements with creditors and members
9. Section 231 Power of Tribunal to enforce compromise or arrangement
10. Section 232 Merger and amalgamation of companies
11. Section 233 Merger or amalgamations of certain companies
12. Section 235 Power to acquire shares of shareholders dissenting from scheme or contract approved by majority
13. Section 236 Purchase of minority shareholding
14. Section 237 Power of Central Government to provide for amalgamation or companies in public interest
15. Section 238 Registration of offer of schemes involving transfer of shares.
16. Section 239 Preservation of books and papers of amalgamated companies
17. Section 240 Liability of officers in respect of offences committed prior to merger, amalgamation, etc.
18. Section 270 Winding up by Tribunal
19. Section 271 Circumstances in which company may be wound up by Tribunal
20. Section 272 Petition for winding up
21. Section 273 Powers of Tribunal
22. Section 274 Directions for filing statement of affairs
23. Section 275 Company Liquidators and their appointments
24. Section 276 Removal and replacement of liquidator
25. Section 277 Intimation to Company Liquidator, provisional liquidator and Registrar
26. Section 278 Effect of winding up order
27. Section 279 Stay of suits, etc., on winding up order
28. Section 280 Jurisdiction of Tribunal
29. Section 281 Submission of report by Company Liquidator
30. Section 282 Directions of Tribunal on report of Company Liquidator
31. Section 283 Custody of company’s properties
32. Section 284 Promoters, directors, etc., to cooperate with Company Liquidator
33. Section 285 Settlement of list of contributories and application of assets
34. Section 286 Obligations of directors and managers
35. Section 287 Advisory committee
36. Section 288 Submission of periodical reports to Tribunal
37. Section 290 Powers and duties of Company Liquidator
38. Section 291 Provision for professional assistance to Company Liquidator
39. Section 292 Exercise and control of Company Liquidator’s powers
40. Section 293 Books to be kept by Company Liquidator
41. Section 294 Audit of Company Liquidator’s accounts
42. Section 295 Payment of debts by contributory and extent of set-off
43. Section 296 Power of Tribunal to make calls
44. Section 297 Adjustment of rights of contributories
45. Section 298 Power to order costs
46. Section 299 Power to summon persons suspected of having property of company, etc.
47. Section 300 Power to order examination of promoters, directors, etc.
48. Section 301 Arrest of person trying to leave India or abscond
49. Section 302 Dissolution of company by Tribunal.
50. Section 303 Appeals from orders made before commencement of Act
51. Section 324 Debts of all descriptions to be admitted to proof
52. Section 326 Overriding preferential payments
53. Section 327 Preferential payments
54. Section 328 Fraudulent preference
55. Section 329 Transfers not in good faith to be void
56. Section 330 Certain transfers to be void
57. Section 331 Liabilities and rights of certain persons fraudulently preferred
58. Section 332 Effect of floating charge
59. Section 333 Disclaimer of onerous property
60. Section 334 Transfers, etc., after commencement of winding up to be void
61. Section 335 Certain attachments, executions, etc., in winding up by Tribunal to be void.
62. Section 336 Offences by officers of companies in liquidation
63. Section 337 Penalty for frauds by officers
64. Section 338 Liability where proper accounts not kept
65. Section 339 Liability for fraudulent conduct of business
66. Section 340 Power of Tribunal to assess damages against delinquent directors, etc.
67. Section 341 Liability under sections 339 and 340 to extend to partners or directors in firms or companies
68. Section 342 Prosecution of delinquent officers and members of company
69. Section 343 Company Liquidator to exercise certain powers subject to sanction
70. Section 344 Statement that company is in liquidation
71. Section 345 Books and papers of company to be evidence
72. Section 346 Inspection of books and papers by creditors and contributories
73. Section 347 Disposal of books and papers of company
74. Section 348 Information as to pending liquidations
75. Section 349 Official Liquidator to make payments into public account of India
76. Section 350 Company Liquidator to deposit monies into scheduled bank
77. Section 351 Liquidator not to deposit monies into private banking account
78. Section 352 Company Liquidation Dividend and Undistributed Assets Account
79. Section 353 Liquidator to make returns, etc.
80. Section 354 Meetings to ascertain wishes of creditors or contributories
81. Section 355 Court, tribunal or person, etc., before whom affidavit may be sworn
82. Section 356 Powers of Tribunal to declare dissolution of company void
83. Section 357 Commencement of winding up by Tribunal
84. Section 358 Exclusion of certain time in computing period of limitation
85. Section 359 Appointment of Official Liquidator
86. Section 360 Powers and functions of Official Liquidator
87. Section 361 Summary procedure for liquidation
88. Section 362 Sale of assets and recovery of debts due to company
89. Section 363 Settlement of claims of creditors by Official Liquidator
90. Section 364 Appeal by creditor
91. Section 365 Order of dissolution of company
92. Proviso to section 370 Continuation of pending legal proceedings
93. Section 372 Power of Court to stay or restrain proceedings
94. Section 373 Suits stayed on winding up order
95. Section 375 Winding up of unregistered companies
96. Section 376 Power to wind up foreign companies, although dissolved
97. Section 377 Provisions of Chapter cumulative
98. Section 378 Saving and construction of enactments conferring power to wind up partnership firm, association or company, etc., in certain cases
99. Sub-section (2) of section 391 Application of sections 34 to 36 and Chapter XX
100. Clause (c) of sub-section (1) of section 434 Transfer of certain pending proceedings

After notification of the aforesaid section , now only ten (10) complete sections and four (4) section with some sub-sections remains to be notified. It is also expected that MCA will shortly notify the rules related to Merger and Amalgamation & Winding-up by Tribunal in days to come.

Click here to download the Notification.

RELAXATION OF ADDITIONAL FEES AND EXTENSION OF LAST DATE OF IN FILING OF FORMS MGT-7 AND AOC-4 FOR THE STATE OF J & K

Due to curfew/ strikes and disturbances from past more than four months in the State of Jammu and Kashmir, MCA vide General Circular No. 13/2016 dated December 07, 2016 has given relaxation of additional fees with respect to filing of forms MGT-7 (Annual Return) and AOC-4 (Financial Statement) under the Companies Act, 2013 for the State of Jammu and Kashmir upto 31.12.2016, wherever additional fees is applicable.

CLARIFICATION REGARDING DUE DATE OF TRANSFER OF SHARES TO IEPF AUTHORITY

After receiving various representations from the Companies for simplification of transfer process of shares under Investor Education & Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016, notified on 05.09.2016, MCA vide General Circular No. 15/2016 dated December 07, 2016 has clarified that the  matters, including simplification of transfer process and extension of date for transfer of shares to IEPF, are under consideration and the rules are likely to be revised. The revised rules shall be notified in due course.

Click here to download the circular

THE COMPANIES (TRANSFER OF PENDING PROCEEDINGS) RULES, 2016

MCA vide Notification No. G.S.R. 1119(E) dated December 07, 2016, has notified the Companies (Transfer of Pending Proceedings) Rules, 2016 which shall come in force from 15.12.2016 except rule 4 which shall come into force from 01.04.2017. The Rules among other things provides for

  1. Transfer of pending proceedings relating to relating to arbitration, compromise, arrangements and reconstruction, other than proceedings relating to winding up on the date of coming into force of these rules under the Companies Act 1956 shall stand transferred to the Benches of the NCLT exercising respective territorial jurisdiction. But all those proceedings which are reserved for orders for allowing or otherwise of such proceedings shall not be transferred.
  2. All applications and petitions relating to voluntary winding up of companies pending before a High Court on the date of commencement of this rule, shall continue with and dealt with by the High Court in accordance with provisions of the Companies Act, 1956.
  3. All petitions relating to winding up under clause (e) of section 433 of the Companies Act, 1956 on the ground of inability to pay its debts pending before a High Court, and where the petition has not been served on the respondent as required under rule 26 of the Companies (Court) Rules, 1959 shall be transferred to the Bench of the NCLT established under sub-section (4) of section 419 of the Companies Act, 2013 exercising territorial jurisdiction and such petitions shall be treated as applications under sections 7, 8 or 9 of the Insolvency and Bankruptcy Code, 2016 as the case may be, and dealt with in accordance with Part II of the Insolvency Code:
  4. All cases where opinion has been forwarded by BIFR, for winding up of a company to a High Court and where no appeal is pending, the proceedings for winding up initiated under the Companies Act, 1956 pursuant to section 20 of the Sick Industrial Companies (Special Provisions) Act, 1985 shall continue to be dealt with by such High Court in accordance with the provisions of the Companies Act, 1956.
  5. All petitions filed under clauses (a) and (f) of section 433 of the Companies Act, 1956 pending before a High Court and where the petition has not been served on the respondent as required under rule 26 of the Companies (Court) Rules, 1959 shall be transferred to the Bench of the NCLT exercising territorial jurisdiction and such petitions shall be treated as petitions under the provisions of the Companies Act, 2013 (18 of 2013).

Click here to download the Rules.

THE COMPANIES (REMOVAL OF DIFFICULTIES) FOURTH ORDER, 2016

MCA vide Notification No. S.O. 3676(E) dated December 07, 2016, has notified the Companies (Removal of Difficulties) Fourth Order, 2016 which shall come in force from 15.12.2016.

In the Companies Act, 2013, in Section 434, in sub-section (1), in clause (c), after the proviso, the following provisos shall be inserted, namely:-

Provided further that only such proceedings relating to cases other than winding-up, for which orders for allowing or otherwise of the proceedings are not reserved by the High Courts shall be transferred to the Tribunal:

Provided further that –

  1. all proceedings under the Companies Act, 1956 other than the cases relating to winding up of companies that are reserved for orders for allowing or otherwise such proceedings; or
  2. the proceedings relating to winding up of companies which have not been transferred from the High Courts;

shall be dealt with in accordance with provisions of the Companies Act, 1956 and the Companies (Court) Rules, 1959”

Click here to download the order