Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) (Second Amendment) Regulations, 2020 No. SEBI/LAD-NRO/GN/2020/36 dated 19th October 2020issued by SEBI In exercise of the powers conferred under Section 30 of the Securities and Exchange Board of India Act, 1992 (15 of 1992), the Board hereby makes the following regulations to amend the Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003, namely: - 1. These

Companies (Prospectus and Allotment of Securities) (Amendment) Rules, 2020 G.S.R. 642(E) dated 16th October 2020issued by MCA In exercise of the powers conferred by section 26, sub-section (1) of section 27, section 28, section 29, sub-section (2) of section 31, sub-sections (3) and (4) of section 39, sub-section (6) of section 40 and section 42 read with section 469 of the Companies Act, 2013 (18 of 2013), the Central Government hereby makes the following rules further to amend the

Standardisation of procedure to be followed by Debenture Trustee(s) in case of ‘Default’ by Issuers of listed debt securities SEBI/HO/MIRSD/CRADT/CIR/P/2020/203 dated 13th October 2020issued by SEBI 1. Representations were made by Debenture Trustee(s) regarding the process to be followed in case of ‘Default’ by issuers of listed debt securities. After consultation with stakeholders including investors, Debenture Trustee(s), Issuers etc., procedures to be followed by the Debenture Trustee(s) in case of ‘Default’ by issuers of listed debt securities has

Meetings of the Disciplinary Committee and Appellate Panel of the RVOs No. IBBI/RVO/34/2020 dated 9th October 2020issued by IBBI The Registered Valuers Organisations (RVOs) act as front line regulators under the Companies (Registered Valuers and Valuation) Rules, 2017. They provide the institutional arrangement for oversight, including the development and regulation of the registered valuers (RV). They grant membership to valuers, who comply with the eligibility requirements as provided in the Rules, conduct the educational courses in valuation and

Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Third Amendment) Regulations, 2020 No. SEBI/ LAD-NRO/GN/2020/33 dated 8th October 2020issued by SEBI In exercise of the powers conferred by section 11, sub-section (2) of section 11A and section 30 of the Securities and Exchange Board of India Act, 1992 (15 of 1992) read with section 31 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956), the Board hereby makes

Issuance, listing and trading of Perpetual Non-Cumulative Preference Shares (PNCPS) and Innovative Perpetual Debt Instruments (IPDIs)/Perpetual Debt Instruments (PDIs) (commonly referred to as Additional Tier 1 (AT 1) instruments) SEBI/HO/DDHS/CIR/P/2020/199 dated 6th October 2020issued by SEBI 1. Perpetual Non-Cumulative Preference Shares (PNCPS’) and Innovative Perpetual Debt Instruments (IPDIs) / Perpetual Debt Instruments (PDIs) (commonly referred to as AT 1 instruments) are essentially non-equity regulatory instruments, forming part of a bank’s capital, governed

Review of Dividend option(s) / Plan(s) in case of Mutual Fund Schemes SEBI/HO/IMD/DF3/CIR/P/2020/194 dated 5th October 2020issued by SEBI 1. Please refer to Ninth and Eleventh Schedule of SEBI (Mutual Funds) Regulations, 1996 and SEBI circular No. SEBI/IMD/CIR No 18 / 198647 /2010 dated March 15, 2010, which provide the accounting policies to be followed for determining distributable surplus and accounting the sale and repurchase of units in the books of

Relaxation in timelines for compliance with regulatory requirements SEBI/HO/MIRSD/DOP/CIR/P/2020/191 dated 1st October 2020issued by SEBI 1. In view of the situation arising due to COVID-19 pandemic, lockdown imposed by the Government and representations received from Stock Exchanges, SEBI had earlier provided relaxations in timelines for compliance with various regulatory requirements by the trading members / clearing members / depository participants, vide circular nos. SEBI/HO/MIRSD/DOP/CIR/P/2020/61 dated April 16, 2020, SEBI/HO/MIRSD/DOP/CIR/P/2020/62 dated April 16, 2020, and SEBI/HO/MIRSD/DOP/CIR/P/2020/68 dated April 21, 2020. Later, vide circular nos. SEBI/HO/MIRSD/DOP/CIR/P/2020/82 dated May 15, 2020, SEBI/HO/MIRSD/DOP/CIR/P/2020/101 dated June 19, 2020 and SEBI/HO/MIRSD/DOP/CIR/P/2020/141

Companies (Appointment and Qualification of Directors) (Fourth Amendment) Rules, 2020 G.S.R. 589(E) dated 28th September 2020issued by MCA In exercise of the powers conferred by section 149 read with section 469 of the Companies Act, 2013 (18 of 2013), the Central Government hereby makes the following rules further to amend the Companies (Appointment and Qualification of Directors) Rules, 2014, namely:- 1. (1) These rules may be called the Companies (Appointment and Qualification of Directors) (Fourth Amendment) Rules, 2020. (2) They shall come into force

Suspension of corporate insolvency resolution process under sections 7, 9 and 10 of the Insolvency and Bankruptcy Code, 2016 for further period of three months from 25th September, 2020 S.O. 3265(E)dated 24th September, 2020 issued by MCA In exercise of the powers conferred by section 10A of the Insolvency and Bankruptcy Code, 2016 (31 of 2016) [as inserted by section 2 of the Insolvency and Bankruptcy Code (Second Amendment) Act, 2020 (17 of 2020)], the Central Government hereby notifies further period of

Insolvency and Bankruptcy Code (Second Amendment) Act, 2020 Act 17 of 2020 dated 23rd September 2020issued by Ministry of Law and Justice An Act further to amend the Insolvency and Bankruptcy Code, 2016. BE it enacted by Parliament in the Seventy-first Year of the Republic of India as follows:— Short title and commencement 1. (1) This Act may be called the Insolvency and Bankruptcy Code (Second Amendment) Act, 2020. (2) It shall be deemed to have come into force on the 5th day of

Write-off of shares held by FPIs SEBI/HO/IMD/FPI&C/CIR/P/2020/177 dated 21st September 2020issued by SEBI 1. SEBI, vide circular number IMD/FPI&C/CIR/P/2019/124 dated November 05, 2019, had issued an Operational Guidelines for FPIs and DDPs under SEBI (Foreign Portfolio Investors), Regulations 2019. 2. In the said Operational Guidelines, write-off of securities held by FPIs who wish to surrender their registration was permitted only in respect of shares of companies which are unlisted/illiquid/suspended/delisted. However, in view of the requests received

Review of Foreign Direct Investment (FDI) Policy in Defence Sector Press Note No. 4 (2020 Series)dated 17th September 2020issued by DPIIT 1. Present Position 5.2.6 Defence Sector/Activity % of Equity/ FDI Cap Entry Route 5.2.6.1 Defence Industry subject to Industrial license under the Industries (Development & Regulation) Act, 1951 and Manufacturing of small arms and ammunition under the Arms Act, 1959 100% Automatic up to 49% Government route beyond 49% wherever it is likely to result in access to modern technology or for other reasons to be recorded 5.2.6.2 Other Conditions i.

Insolvency and Bankruptcy Board of India (Annual Report)(Amendment) Rules, 2020 G.S.R. 563(E)dated 10th September 2020issued by IBBI In exercise of the powers conferred by clause (zm) of sub-section (2) of section 239, read with sub-section (1) of section 229 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Central Government hereby makes the following rules to amend the Insolvency and Bankruptcy Board of India (Annual Report) Rules, 2018, namely:- 1. (1) These rules may be called the Insolvency and Bankruptcy Board of

  Insolvency and Bankruptcy Code (Second Amendment) Bill, 2020 (As introduced in the Rajya Sabha ) Bill No. XXXI of 2020dated 9th September 2020 A BILL further to amend the Insolvency and Bankruptcy Code, 2016. BE it enacted by Parliament in the Seventy-first Year of the Republic of India as follows:— Short title and commencement. 1. (1) This Act may be called the Insolvency and Bankruptcy Code (Second Amendment) Act, 2020. (2) It shall be deemed to have come into force on the 5th day of June, 2020. Insertion of

Role of the Government and its Agencies in the Corporate Insolvency Resolution and Liquidation Processes1 Facilitation / 004 / 2020dated 12th September 2020issued by IBBI The Insolvency and Bankruptcy Code, 2016 (Code) consolidates and amends the laws relating to reorganisation and insolvency resolution of corporate persons, partnership firms and individuals in a time bound manner for maximisation of the value of assets of such persons, to promote entrepreneurship, availability of credit and balance the interests of all the stakeholders.

Relaxation of additional fees and extension of last date of filing of CRA-4 (form for filing of cost audit report) for FY 2019-20 under the Companies Act, 2013 General Circular No.29/2020 dated 10th September 2020issued by MCA Representations have been received from various stakeholders for extension of last date of filing of CRA-4 (form for filing of cost audit report) due to impact of COVID-19 pandemic. 2. In view of the extraordinary disruption caused due to the pandemic, it has been decided that

Automation of Continual Disclosures under Regulation 7(2) of SEBI (Prohibition of Insider Trading) Regulations, 2015 - System driven disclosures SEBI/HO/ISD/ISD/CIR/P/2020/168 dated 9th September 2020issued by SEBI 1. Vide Gazette Notification No. SEBI/LAD-NRO/GN/2020/23 dated July 17, 2020, Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 (PIT Regulations) have been further amended. 2. SEBI, vide circular no. CIR/CFD/DCR/17/2015 dated December 01, 2015, CFD/DCR/CIR/2016/139 dated December 21,

Extension of time for holding of Annual General Meeting (AGM) for the financial year ended on 31st March, 2020 Order No. ROC/Delhi/AGM Ext./2020/11538dated 8th September 2020 issued by ROC Delhi 1. Whereas sub-section (1) of section 96 of the companies Act, 2013 (the Act) provides, inter-alia, that every company, other than a One Person Company, shall in each year hold in addition to any other meetings, a general meeting as its annual general meeting (AGM) and shall specify the meeting as such

Companies (Acceptance of Deposits) (Amendment) Rules, 2020 G.S.R. 548 (E) dated 7th September 2020issued by MCA In exercise of the powers conferred by section 73 read with sub-sections (1) and (2) of section 469 of the Companies Act, 2013 (18 of 2013), the Central Government in consultation with the Reserve Bank of India, hereby makes the following rules further to amend the Companies (Acceptance of Deposits) Rules, 2014, namely:- 1. (1) These rules may be called the Companies (Acceptance of Deposits) (Amendment)

Electricity dues being of statutory character, the power distribution company can demand the arrears due of the last owner from the auction purchaser of the unit Where electricity dues are statutory in character under the Electricity Act and as per the terms and conditions of supply, they cannot be waived in view of the provisions of the Act itself, more specifically section 56 of the Electricity Act, 2003 (in pari materia with section 24 of the Electricity Act, 1910) and cannot

Where there is no basis to hold that the scheme as filed does not constitute as an arrangement, it cannot be said that the scheme does not satisfy the requirements of an arrangement Where there is no basis to hold that the scheme filed by the petitioner company does not constitute as an arrangement between the company and its shareholders within the meaning of sections 230 to 232, that would not inhibit consideration of the scheme to satisfy the requirements of

Where application is complete as per requirements of section 9, it is liable to be admitted Where the applicant operational creditor has produced affidavit and statement of bank account in compliance of clause (c) of sub-section (3) of section 9, has proposed the name of the resolution professional against whom no disciplinary proceedings are pending, the application is complete, and is liable to be admitted. Insolvency and Bankruptcy Code, 2016 – Section 9 – Insolvency resolution process – Application by operational creditor

While disowning a son is not going to deprive him of any right in the property of father, question has to be finally decided as to title, nomination, etc., of securities in a civil suit and cannot be decided by the NCLT in proceedings before it Merely disowning a son by late father or by the family is not going to deprive him of any right in the property to which he may be otherwise entitled in accordance with the law.

Where applicant was not financial creditor and liability of corporate debtor restricted to pledge of shares had been meted with, the liquidator rightly rejected the claim of the applicant Where the applicant was not a financial creditor of the corporate debtor, and the liability of the corporate debtor was restricted to the pledge of shares, which had already been meted with, the liquidator was right in rejecting the claim of the applicant on the said ground. Insolvency and Bankruptcy Code, 2016 –

Direction issued by the Tribunal to implead Secretary of Ministry of Corporate Affairs is beyond the power of the Tribunal The direction issued by the Tribunal on the application filed by the resolution professional to implead the Secretary of Ministry of Corporate Affairs as party respondent in all cases of the Code is nothing but beyond the power of the Tribunal, and it tantamounts to imposition of a new rule in a compelling fashion. Making it applicable throughout the country is

In view of the provisos inserted to sub-section (1) of section 7 by the Ordinance promulgated on 28th December, 2019 before the admission of the application under section 7, the Adjudicating Authority has no jurisdiction to direct the corporate debtor to deposit any amount to certain corpus or with regard to maintenance which may not be a subject matter of application under section 7 In view of the insertion of provisos before Explanation to sub-section (1) of section 7, the Adjudicating

Where resolution applicant is not a related party as per definition in clause (24) of section 5, it is eligible to file resolution plan Upon a perusal of clause (a) of sub-section (1) of section 32A (inserted by an Ordinance promulgated on 28th December, 2019) read with the definition of 'related party' in clause (24) of section 5, it is ex facie evident that the resolution applicant is not an associate company/related party of the corporate debtor. Further, interpretation of section

Where combinations do not come within threshold value of assets mentioned in section 5, there is no need of obtaining any approval of the Competition Commission Where combinations, as a result of merger, amalgamation, acquisition, etc., do not come within the meaning of section 5, there is no need of obtaining any approval of the Competition Commission under sub-section (2) of section 6 by issuing a notice on it Competition Act, 2002 – Section 5 – Combination – Acquisition

Once proceedings commence under the Code and moratorium declared, the High Court ought not to have proceeded with the auction of the property Where once the proceedings under the Code had commenced, and an order declaring moratorium was passed by the Tribunal, it is not open to the High Court to have proceeded with the auction of the property of the corporate debtor. If the assets of the corporate debtor are alienated during the pendency of the proceedings under the

Where resolution process had begun well before the amended regulation came into force, and resolution plan was prepared and approved before that event, the NCLAT was not justified requiring appellant to match the pay out offered to other financial creditors to a particular operational creditor Given that the resolution process began well before the amended regulation came into force (in January, 2017) and the resolution plan was prepared and approved before that event, the wide observations of the NCLAT, requiring

It is not open to the High Court to interfere with the order passed by the District Judge holding that the grounds urged in the application under section 34 can very well be considered by the evidence adduced in the arbitration proceedings and considering the arbitral award The proceedings under section 34 are summary in nature, the scope of enquiry being restricted to a consideration whether any of the grounds mentioned in sub-section (2) of section 34 or sub-section (5)

Operation of the Rent Act cannot be extended to a tenant-in-sufferance against order of the Chief Metropolitan Magistrate rejecting his application to intervene to stay execution of order for taking possession of secured property Securitisation Act is a self executing instrument for debt recovery and its provisions override all other laws as per broad terms of its section 35. Tenant in sufferance cannot intervene to stay execution order to take possession of secured property Securitisation and Reconstruction of Financial Assets and Enforcement

Information sought for by an applicant can only be denied under the specific instances enumerated in sections 8 and 9 and in no other case Right to Information Act, 2005 – Sections 8 and 9 – Information – Exemption from disclosure of – Rejection to access – Grounds for – Can information sought for by an applicant only be denied under specific instances in section 9. The Government has the power to issue order directing hierarchy of officer to deny information related

Time barred winding up petition cannot be given a new lease of life under section 238A. Limitation can be extended only in the manner provided in the Limitation Act Where winding up petition, on the date it was filed, is barred by lapse of time, then section 238A will not give a new lease of life to such time barred petition. However, a suit for recovery based upon a cause of action that is within limitation cannot in any manner

Resolution plan cannot seek to terminate agreements that created legal rights in third parties. To terminate such agreement due process of law is required to be adhered to Resolution applicant, in its resolution plan, cannot seek to terminate agreements that have created legal rights in third parties without adhering to the due process of law by which those agreements could have been terminated in case there was no corporate insolvency resolution process. Insolvency and Bankruptcy Code, 2016 – Section 30 – Resolution

The essence of section 241/242 would be defeated if during the pendency of the petition, the operational creditors or financial creditors are allowed to initiate the corporate insolvency resolution process itself If the Board of directors on perusal of the record finds that there is no money payable or receivable to pay to the operational creditors / financial creditors to save it from initiation of the corporate insolvency resolution process, the Tribunal or Appellate Tribunal cannot go into commercial wisdom and

Order passed by company court under section 446 of the Companies Act, 1956 allowing leave to continue suit would be saved by section 465 read with section 279 of the Companies Act, 2013 Where the order allowing leave to continue suit is passed by the High Court as company court in exercise of its powers under section 446 of the Companies Act, 1956, the said order shall be deemed to be an order passed under section 279 of the 2013 Act.

Where National Company Law Tribunal’s order directed the petitioners to sell entire shareholding to respondents, without clearly identifying the respondents, since company was itself a respondent and buy-back of shares was not meant and there appeared to be some casual or clerical error in the order, it is open to the Appellate Tribunal to modify the order appropriately Where National Company Law Tribunal was not articulate in directing the petitioners to sell their entire shareholding held in respondent-company to the other

Where corporate debtor had taken bank guarantee but not invoked it, the resolution professional has rightly not accepted the claim of the appellant Where ‘corporate debtor’ had taken bank guarantee but the same was not invoked in favour of the appellant as on the date of admission on filing of claim, on declaration of moratorium, it was not open to the appellant to invoke the guarantee. Where it was also not the case of the appellant that it had not received

This article dwells upon chequered history of corporate social responsibility concept which was formally introduced in section 135 of the Companies Act, 2013 read with Schedule VII thereto and the Companies (Corporate Social Responsibility) Rules, 2014 and had undergone multiple amendments from time-to-time with a view to ease of doing business.

This article is intended to give a bird’s eye view of the Companies Fresh Start Scheme, 2020 initiated by the Ministry of Corporate Affairs in the wake of lockdown situation caused by the Covid-19 Pandemic to relieve the companies from remission of additional fees on delayed compliance with the provisions of the Companies Act, 2013 and Rules/Regulations made thereunder.

In this article, the authors discuss key relaxations in the pricing framework for preferential allotment announced by the Securities and Exchange Board of India on 25th June, 2020.

In this article the author give an overview of the Supreme Court ruling in Anuj Jain v. Axis Bank Ltd. [2020] 155 CLA 139 laying down law relating to preferential transactions under the Insolvency and Bankruptcy Code, 2016.

This article explains the legal understanding of the terms ‘force majeure’ and ‘doctrine of frustration’ of a contract. It further dwells on the role these defences might play during the COVID-19 pandemic, with a special reference to the commercial lease deeds entered into, by the businesses.

This article is aimed at emphasising the need for investigation simultaneously by the Directorate of Enforcement and the Competition Commission of India into the alleged violation of foreign direct investment norms and the Competition Act, 2002 by Amazon and Flipkart.

In this article the authors analyse the Supreme Court decision in Ssangyong Engineering & Construction Co. Ltd. v. National Highways Authority of India [2019] SCC Online 677 which limits the grounds for setting aside a final award arising out international commercial arbitration seated in India, thereby de-throning the ground of 'patent illegality', as otherwise available under section 34 of the Arbitration and Conciliation Act, 1996 as amended till date. **EFW**

This article aims to highlight the major/latest compliances which the listed companies are required to comply under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 as amended by the Amendment Regulations, 2018, 2019, 2020 and SEBI Circulars issued thereunder to improve transparency and protect investors' interest.

This article has assimilated Committee’s observations, relevant provisions and references with comments and remarks on recommendations in Annexure V for amendments in the Companies Act, 2013

This article analyses the proposed amendments to the Companies Act, 2013 relating to related party and procedural or approval process in related party transactions.

In this article, the author examines issues as to whether the competition regulator, the Competition Commission of India (CCI), should have a role in such corporate insolvency resolution process (CIRP), which is primarily justified under the “failing firm” defence and whether it has created another regulatory hurdle for the foreign investors who may be interested in purchasing the assets or otherwise robust Indian companies in crucial sectors with a well established marketing network with goodwill and well-known brand of products

The purpose of this article is to discuss, firstly, the need of cross-border insolvency law in India, secondly, global practice in the event of cross-border insolvency, and thirdly, the cross-border insolvency of Jet Airways by the National Company Law Tribunal which opens a gate for cross-border insolvency in India.

This article aims to look at the current issues faced by banks on account of the teething problems of liquidity with non-banking financial companies (NBFCs) to whom such banks have exposure. The main issue looked herein is: If banks were to agree for a resolution plan under the resolution framework for an NBFC/FSP and if the Government invokes section 227 of the Insolvency and Bankruptcy Code, 2016 (Code) which will even make the insolvency of such NBFC/FSP to be governed

The author has discussed in this article as to how sub-section (5) of section 152, sub-section (1) of section 160 and other applicable provisions of the Companies Act, 2013 are relevant and need be complied with even for re-appointment of independent directors.

Sub-section (5) of section 135 of the Companies Act, 2013, along with rule 4 of the Corporate Social Responsibility Rules, 2014, mandates the complete code, methodology and procedure for mandatory corporate social responsibility (‘CSR’) spend by a company. The author has endeavoured to assimilate, analyse and elaborate the same in this article so as to avoid any criminal or civil liability.

This article is intended to explain permeating effect of dishonor of cheque proceedings under section 138 of the Negotiable Instruments Act, 1881 on moratorium under section 14 of the Insolvency and Bankruptcy Code, 2016.

This article is intended to provide insights into the working of the Insolvency and Bankruptcy Code, 2016 and the Regulations and Rules made thereunder.

The Companies (Amendment) Act, 2019 has amended section 135 of the Companies Act, 2013 to toughen the provisions governing corporate social responsibility (CSR), stiffening norms pertaining to CSR spending for corporates, and strengthening the enforcement. In this article, the author makes an attempt to analyse amended provisions.

This article is intended to give glimpse of the amendments made by the Companies (Amendment) Act, 2019 in the Companies Act, 2013

Stringent punishment has been prescribed under Chapter V of the Companies Act, 2013 for default in repayment of deposits or interest thereon. It is interesting to note that in addition to these penal consequences under Chapter V, a defaulting company is also debarred from initiating various other corporate actions, which are spelt out in different sections of the Act. This article lists out the said prohibitions applicable to a company if it makes a default in the repayment of deposits

Reference to arbitration – To refer a dispute, is it mandatory that there should be a contract in writing – Being a commercial document, the arbitration agreement, in whatever form it is there, has to be interpreted in such a manner so as to give effect to the agreement.

Arbitral award – Application for setting aside – Can it be preferred beyond period of limitation under section 34 of the Arbitration and Conciliation Act, 1996 – Applicant cannot take recourse to the provisions of section 34 to filing an application beyond four months from the date of receipt of the award in arbitration and this period cannot be got extended even if there is any plausible and genuine reasons for doing so.

Disgorgement order – Whether it can be passed against several persons jointly/severally in respect of securities of a listed companies – The question of issuing a disgorgement order ‘jointly and severally’ against persons who have benefitted out of transactions in the stock exchange of securities of a listed company in their individual capacity would not arise.

NCLT – Power to supersede Board of directors – The Board of directors cannot be superseded by the NCLT invoking powers conferred under sub-section (2) of section 242

Documents of company – Whether its property – Document of a company, being movable property, if document is stolen for purposes of obtaining a wrongful gain, the company can take recourses to the Code to get redressed

Reduction of capital – Absentee shareholders were given opportunity to accord approval thereto and they choose not to avail that opportunity – Can they be given another opportunity – Once the absentee shareholders were given an opportunity and they choose not to avail of the opportunity by not attending meeting, they cannot agitate for affording of another opportunity.

Record date – What it is with reference to listed securities and compliance requirements – This pre-announced date is record date in respect of securities held by investors in demat form. In order to ensure uniformity, it would be advisable to adopt this pre-announced date as the date of entitlement of the holders of securities in demat form and in physical form. This date should not be confused with dates of closure of transfer books.

Disclosure of acquisition – Is every person belonging to promoter group of a listed company required to disclosure to stock exchanges - If the common objective of exercise of control is not present in regard to a subsequent acquisition, then in respect of that acquisition the obligation of disclosure to the stock exchanges would not be triggered in. But the same would not be the case in regard to the purchase of shares or voting rights is by a promoter

Executive director – Can he be appointed without any mandatory consideration – Executive director can be appointed without any monetary consideration and such an appointment is valid in law.

Director Identification Number (DIN) – Is it mandatory to mention in the resolution appointing a director ? – Even though it is not mandatory to mention DIN in the resolution appointing a person a director, it will be ideal that DIN is mentioned in the resolution be it of the Board or of the general meeting.

Borrowing – Does purchase of an asset on deferred payment basis amount to borrowing from vendor of asset – Clarification of the then Department of Company Affairs that the term ‘borrowing’ in clause (d) of sub-section (1) of section 283 of the Companies Act, 1956 does not include debt, on account of purchase of assets on deferred payment, equally applies to purchase on deferred payment.

Oppression/mismanagement – Application for relief against – It is necessary for the aggrieved person to be a member at the time the act complained of took place.

Transfer of shares – Refusal to register – Does refusal give inherent right to Board of directors – Power to refuse registration of transfer of shares has to be conferred on the Board of directors through articles of association.

Board meetings – Minimum notice period for convening Board/general meetings in the case of directors/members residing abroad – In addition to the prescribed period of seven days, a further reasonable period of notice should be given so that the person receiving the notice make up mind and travel plans and be present at the meeting of the Board. If it is not so given the Board meeting may be declared convened without sufficient notice and the decisions taken thereat are

Executive director - Can he, on attaining the age of 70 years, continue its office without the appointment being made afresh – A person who has not attained the age of seventy years could be appointed as executive director of a company by its Board which appointment has been subsequently approved by the company in general meeting by ordinary resolution. However, he could continue as its executive director on hid attaining the age od seventy yeas only after the appointment

Director – Vacation of office under sub-section (2) of section 167 – When does it take effect – Vacation would be instantaneous on the occurrence of the specified event.

Independent director – Status on being appointed as an occupier of company of which he is a director – Would he lose his status as an independent director – Independent director cannot be appointed as an occupier of the factory owned by the company.

Board of directors – Its status where an interim resolution professional (‘IRP’) has been appointed under section 17(1) of the Insolvency and Bankruptcy Code, 2016 – On the appointment of an IRP to a company, its directors would not cease to hold the office of the director of the company ; but they would be guided in the discharge of their duties by the IRP.

E-voting on resolutions placed before a general meeting – Should preference shareholders not be taken into account for computing 1000 shareholders – In computing 1000 shareholders mandatory application of section 108 read with rule 20(2) of the Companies (Management and Administration) Rules, 2014 would trigger in regard to resolutions before a general meeting.

Auditor in office – Prohibited services which he cannot undertakes during the tenure of his appointment – Since the tenure of his appointment would partly fall in an earlier financial year in which annual general meeting is held and partly in subsequent financial year, it is during this tenure of appointment the auditor is prohibited from undertaking the services spelt out in section 144.