Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Fourth Amendment) Regulations, 2020 No. IBBI/2020-21/GN/REG064 dated 7th August 2020issued by IBBI In exercise of the powers conferred by clause (t) of subsection (1) of section 196 read with section 240 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Insolvency and Bankruptcy Board of India hereby makes the following regulations further to amend the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations,

Extension of term of appointment of Shri Ajay Tyagi as Chairman of the Securities and Exchange Board of India S.O. 2630(E) dated 6th August 2020issued by Ministry of Finance In exercise of the powers conferred by Sub-Section (1)(a) and Sub-Section (4) of Section 4 of the Securities and Exchange Board of India Act, 1992 (15 of 1992), read with Rule 3 of the Securities and Exchange Board of India (Terms and Conditions of Service of Chairman and Members) Rules, 1992,

Securities And Exchange Board of India (Listing Obligations And Disclosure Requirements) (Second Amendment) Regulations, 2020 SEBI/LAD-NRO/GN/2020/25 dated 5th August 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),

Grievance Resolution between listed entities and proxy advisers SEBI/HO/CFD/CMD1/CIR/P/2020/119 dated 4th August 2020issued by SEBI 1. Regulation 4(2)(a) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘LODR’) casts certain obligations on listed entities to protect and facilitate the exercise of the rights of shareholders, including: a. right to participate in, and to be sufficiently informed of, decisions concerning fundamental corporate changes, b. opportunity to participate effectively and vote in general shareholder meetings, c. effective

Clarification on applicability of regulation 40(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 to open offers, buybacks and delisting of securities of listed entities SEBI/HO/CFD/CMD1/CIR/P/2020/144 dated 31st July 2020issued by SEBI 1. The proviso to regulation 40(1) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘LODR Regulations’) states that “..except in case of transmission or transposition of securities, requests for effecting transfer of securities shall not

Appointment of Members of the International Financial Services Centres Authority S.O. 2527(E) dated 30th July 2020issued by Ministry of Finance In exercise of the powers conferred by section 5(1)(b) of International Financial Services Centres Authority Act, 2019 (No. 50 of 2019), the Central Government hereby appoints the following persons as Members of the International Financial Services Centres Authority (IFSCA): 1. Smt. Indrani Banerjee,     Executive Director     Reserve Bank of India 2. Shri Sujit Prasad,     Executive Director    Securities and Exchange Board of India 3. Smt. T.L. Alamelu,  

Extension of time for submission of financial results for the quarter/half year/ financial year ended 30th June 2020 SEBI/HO/CFD/CMD1/CIR/P/2020/140dated 29th July 2020issued by SEBI 1. SEBI, vide circular No. SEBI/HO/CFD/CMD1/CIR/P/2020/106 dated June 24, 2020, had extended the timeline for submission of financial results by listed entities for the quarter / half- year / financial year ended 31st March 2020 to July 31, 2020 due to the impact of the CoVID- 19 pandemic. 2. Regulation 33 of the SEBI (Listing Obligations

Foreign Exchange Management (Non-debt Instruments) (Third Amendment) Rules, 2020 S.O. 2442 (E) dated 27th July 2020issued by Ministry of Finance In exercise of the powers conferred by clauses (aa) and (ab) of sub-section (2) of section 46 of the Foreign Exchange Management Act, 1999 (42 of 1999), the Central Government hereby makes the following rules further to amend the Foreign Exchange Management (Non-debt Instruments) Rules, 2019, namely:- 1. (1) These rules may be called the Foreign Exchange Management (Non-debt Instruments) (Third Amendment) Rules,

Relaxations relating to procedural matters - Takeovers and Buy-back SEBI/HO/CFD/DCR2/CIR/P/2020/139 dated 27th July 2020issued by SEBI 1. SEBI vide Circular no. SEBI/CIR/CFD/DCR1/CIR/P/2020/83 dated May 14, 2020 granted one time relaxations from strict enforcement of certain regulations of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 and SEBI (Buy-back of securities) Regulations, 2018 pertaining to open offers and buy-back through tender offers opening upto July 31, 2020. 2. Based on the representations received from the

Relaxations relating to procedural matters - Issues and Listing SEBI/HO/CFD/DIL1/CIR/P/2020/136 dated 24th July 2020issued by SEBI 1. SEBI vide Circular no. SEBI/HO/CFD/DIL2/CIR/P/2020/78 dated May 6, 2020 granted one time relaxations from strict enforcement of certain regulations of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, pertaining to Rights Issue opening upto July 31, 2020. 2. Based on the representations received from the market participants, the validity of relaxations, as provided by Circular No. SEBI/HO/CFD/DIL2/CIR/P/2020/78 dated

Allowing Offer for Sale (OFS) and Rights Entitlements (RE) transactions during trading window closure period SEBI/HO/ISD/ISD/CIR/P/2020/133 dated 23rd July 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. Clause 4 (3) (b) of Schedule B read with Regulation 9 of PIT Regulations, inter-alia, states that trading window restrictions shall not apply in respect of transactions

Securities and Exchange Board of India (Settlement Proceedings) (Amendment) Regulations, 2020 No. SEBI/LAD-NRO/GN/2020/24dated 22nd July 2020issued by SEBI In exercise of the powers conferred by Section 15JB of the Securities and Exchange Board of India Act, 1992, Section 23JA of the Securities Contracts (Regulation) Act, 1956 and Section 19-IA of the Depositories Act, 1996 read with Section 30 of the Securities and Exchange Board of India Act, 1992, Section 31 of the Securities Contracts (Regulation) Act, 1956 and Section 25 of

Eligibility Criteria for Selection of Underlying Commodity Futures for Options on Commodity Futures SEBI/HO/CDMRD/DNPMP/CIR/P/2020/125dated 20th July 2020issued by SEBI 1. SEBI vide circular SEBI/HO/CDMRD/DMP/CIR/P/2017/55 dated June 13, 2017 regarding “Options on Commodity Futures - Product Design and Risk Management Framework” under Clause ‘3a’ had prescribed the following eligibility criteria for selection of commodity futures as underlying for options: “The underlying 'Futures contracts' on the corresponding commodity shall be amongst the top five futures

Securities and Exchange Board of India (Prohibition of Insider Trading) (Amendment) Regulations, 2020 No. SEBI/LAD-NRO/GN/2020/23dated 17th July 2020issued by SEBI In exercise of the powers conferred under Section 30 read with clause (g) of sub-section (2) of Section 11 and clauses (d) and (e) of Section 12A 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 Insider

Manner and mechanism of providing exit option to dissenting unit holders pursuant to Regulation 22(5C) and Regulation 22(7) of SEBI Infrastructure Investment Trusts Regulations, 2014 (“SEBI (InvIT) Regulations”) SEBI/HO/DDHS/DDHS/CIR/P/2020/122dated 17th July 2020issued by SEBI 1. Regulation 22 (5C) and Regulation 22 (7) of SEBI (InvIT) Regulations provide for exit option to be given to dissenting unit holders. 2. This circular details the guidelines in respect of conditions, manner and mechanism of exit

Re-constitution of the Benches at NCLT, New Delhi Order File No. 10/03/2020-NCLTdated 16th July 2020issued by NCLT In exercise of the powers conferred by Section 419 of the Companies Act, 2013, the Hon'ble President, NCLT hereby re-constituted the Benches at New Delhi for the purpose of exercising and discharging the functions assigned by the statute (s). This is in partial modification of Order dated 3.3.2020 & other subsequent orders in this regard. 2. The pendency of urgent applications is increasing at NCLT New

Relaxation from compliance with provisions of the SEBI (Issue and Listing of Debt Securities) Regulations, 2008 (“ILDS Regulation”), SEBI (Non-Convertible Redeemable Preference Shares) Regulations, 2013 (“NCRPS Regulations”) and SEBI Circulars relating to Listing of Commercial Papers SEBI/HO/DDHS/CIR/P/2020/121 dated 15th July 2020issued by SEBI 1. ILDS Regulations, NCRPS Regulations and circulars related to Listing of Commercial Papers (CPs) require an Issuer to inter-alia submit its latest audited financials which should not be older

Guidelines for Issue and Listing of Structured Products/ Market Linked Debentures - Amendments SEBI/HO/DDHS/CIR/P/2020/120dated 13th July 2020issued by SEBI 1. SEBI vide circular no. CIR/IMD/DF/17/2011 dated September 28, 2011 (hereinafter referred as "MLD circular") prescribed guidelines for issue and listing of structured products/ Market linked Debentures (MLDs). 2. Para 4(f)(i) of the MLD circular, specifies that issuer of MLDs shall appoint a third party valuation agency which shall be a Credit Rating Agency (CRA) registered with SEBI

Securities and Exchange Board of India (International Financial Services Centres) Guidelines, 2015 - Amendments SEBI/HO/IFSC/CIR/P/2020/117 9th July 2020issued by SEBI Kindly refer to SEBI (IFSC) Guidelines, 2015 which were notified by SEBI on March 27, 2015 and SEBI Circular dated July 27, 2017. 2. In order to further streamline the operations at IFSC, based on the internal discussions and consultations held with the stakeholders, it has been decided to amend clause 4 (1) of

Amendments in the notification number S.O. 3756(E) dated 28th November, 2017 S.O. 2282(E)dated 8th July 2020 issued by MCA In exercise of the powers conferred by sub-sections (5) and (6) of section 125 of the Companies Act, 2013 (18 of 2013) read with rules 5 and 7 of the Investor Education and Protection Fund Authority (Appointment of Chairperson and Members, holding of meetings and provision for offices and officers) Rules, 2016 (herein after referred to as the said rules), the Central

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

Where admittedly the revival of the corporate debtor company would enhance the interest of all stakeholders, and no infirmity is brought out in resolution plan, the same is to be approved under sub-section (1) of section 31 Adjudicating Authority is not expected to substitute its view with the unanimous commercial wisdom of the committee of creditors nor should deal with technical complexity and merits of resolution plan unless it is found contrary to the express provisions of law and goes

The Adjudicating Authority has no power to entertain any order passed by a foreign court against the corporate debtor registered in India and the order of the foreign country is nullity Sections 234 and 235, which deal with the matter regarding the agreement with foreign countries and the letter of request to a country outside India in the insolvency resolution process where the assets of the corporate debtor exist outside India, is yet to be notified and hence not

Only that part of the approved resolution plan which related to the closure of the corporate debtor would be set aside as it was against the object of the Code, the same being revival and continuation of corporate debtor Where the Adjudicating Authority, while approving the so-called resolution plan, observed against the object of the Code, namely, that it was a unique plan which provided no revival of the corporate debtor but to close it by discharging the debts to

Where litigation was going on between the parties, the Registrar should not have struck off the name of the company. Once the Tribunal directed filing of statutory return within 30 days, still had sufficient powers to extend the said 18:21:37 Where clearly there was litigation going on between the parties and even the investigating auditor had been involved and gave a report and company petition was pending, it was wrong on the part of the Registrar of Companies to have

There is no bar for initiation of insolvency proceedings in different forums in view of overriding effect of section 238 when proceedings are initiated and pending in different forums Initiation and pendency of proceedings in different forums is no bar for initiation of insolvency resolution process under section 7 in view of the overriding effect given to the provisions of section 238. Insolvency and Bankruptcy Code, 2016 – Sections 7 and 238 – Insolvency resolution process – Initiation by financial creditor –

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

In the recent time a lot of changes have been seen and various measures have been taken against the defaulter for not paying the monies/loans taken by them from various lenders. In this article, the author makes an attempt to find out who is eligible to represent a wilful defaulter.

This article has been drafted with a view to explain and amplify the scope and applicability of sections 58 and 59 of the Companies Act, 2013 dealing with refusal or neglect to transfer or effect transmission by company and appeal thereof and rectification of register of members.

The bidding applicants in the corporate insolvency resolution process are generally the business rivals. An acquisition, therefore, may raise competition concerns. Section 31 of the Insolvency and Bankruptcy Code, 2016 dealing with the approval of resolution plan did not provide for the mandatory approval from Competition Commission. However, that section has been recently amended and now it mandates for the ‘prior approval of the resolution plan by the Competition Commission’, wherever applicable. This article chronicles the process of recognition of

In a recent notification dated 8th February, 2019, the Ministry of Corporate Affairs introduced a revamped version of Significant Beneficial Ownership Rules, 2018. The Significant Beneficial Ownership Rules, 2019 clarified the ambiguities existing in the erstwhile rules notified last year in June. In this article the author makes a comparative analysis of the provisions of 2018 Rules and 2019 Rules.

Depositors, specially the small ones, are an exploited lot and should be adequately protected. Promulgation of the Unregulated Deposit Schemes Ordinance, 2019 is the latest step taken by the Government to safeguard the depositors’ interests. Chapter V of the Companies Act, 2013 (‘Act’) contains good number of provisions aimed at protecting the interest of company depositors. However, the Act prescribes other norms also to discipline the deposit taking companies. Provisions other than Chapter V are discussed in this article.

In this article, the author makes an attempt to find out who is the corporate debtor; Is he borrower or corporate guarantor or both. He stresses the point that the ultimate goal of the Code is to facilitate resolution, even if the amounts that are to be recovered from the guarantors are the same. Instead of setting aside insolvency proceedings against any one or more of the guarantors, the Code must allow simultaneous resolution of such multiple guarantors.

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.

Bonus shares – Allotment to holders of partly paid up shares having no right to get bonus shares – Would partly paid-up share cover partly paid-up preference shareholders – As preference shareholders are not entitled to bonus shares, it would be immaterial whether those shares are paid-up or partly paid-up. Therefore, bonus shares would not affect rights of preference shareholders and their existence would not hamper in allotting shares.

Securities premium – Can it be written off against accumulated losses – For the purposes of reduction of securities premium, the same is equivalent to share capital and that reduction of share capital could be undertaken for any purpose including for wiping off of accumulated losses and reduction of securities premium could be undertaken by a company for wiping off of accumulated losses.

Independent director – Re–appointment of – Should special resolution be passed before making the reappointment – The power to reappoint an independent director already in office has not been conferred on the company in general meeting while the power to determine his eligibility to be reappointed has been conferred on the company in general meeting. Therefore, special resolution has to be passed by the company in general meeting before the reappointment is made.

Compromise or arrangement – Approval of members by voting in person or by proxy or postal ballot – Can member vote through proxy in a meeting convened by NCLT to obtain its approval to scheme under section 230 – Member can vote through proxy if he has decided not to vote by post or in any electronic mode but to vote in a meeting.

Board of directors – Can it act on the basis of enabling powers spelt out in the Act in the absence of powers in the articles of association of a company – Board of directors cannot exercise a power on the ground that it is an enabling power in the Act, unless there is a suitable provision in the articles of association.

Equity shares – Preferential allotment to the holding company of a listed company – Does it attract section 188 – Even though the subject matter of the resolution relating to preferential allotment is shares, they are not ‘goods’ in the eye of law and as such the provisions of section 188 would have no application to a resolution for the allotment of shares preferentially to the promoters.