Nepali Escort Girl Gomti Nagar \ 9548273370 Indian Call Girls Service Lucknow...
Companies act of 1956
1. COMPANIES ACT OF 1956
By,
Divya Devaiah
Deepak.M.S
Bhushan patil
Ajay.S
Goutham pai
2. CONTENTS
Directors: appointment, power, duties
and liabilities
Meeting and resolutions, types of
meeting
Auditor: appointment, rights and
liabilities
Winding up of company: meaning,
modes
Liquidator: powers and duties
3. Sec 2(13) of companies act of
1956
Defines a director as ‘any person
occupying the position of a director, by
whatever name called’
In general ,a person is said to be
occupying a position of a director, if he
has been charged with the
responsibility of directing, conducting
and controlling the affairs of a
company
4. QUALIFICATION OF DIRECTOR
Under the act, only individuals can become directors
There is no academic, technical qualifications for a
director
Section 270 of act, requires a director to hold
qualification shares in the company, and it should be
fixed by the articles of company
The nominal or face value of the qualification shares of
director fixed by articles should not exceed rs 5000.
The qualification shares must be acquired by a person
elected as a director within 2 months of his appointment
As per section 149 , director appointed by promoters of
a newly incorporated firm, director must pay for
qualification shares before certificate to commence
business is obtained
5. Contd…..
For the purpose of the calculation of the
qualification shares ,only shares included in the
share certificate in the name of director are taken
into account, share warrants in his name shouldn’t
be taken into account
Qualification shares held by director should be
disclosed in the prospectus
With in two months of his appointment, he should
file with the registrar a declaration specifying the
qualification shares held by him
6. Consequences of failure to
acquire qualification shares
He ceases to be a director automatically, soon after
the prescribed period(2 MONTHS)
Even after expiry of the stipulated period, if he
continues to act as a director, he will be fined for
period he was acting as a director.
He can be restrained from acting as a director of
company by an order of injunction issued by an
competent court
7. DIFFERENT WAYS OF
APPOINTMENT OF
DIRECTORS company
By the promoters of
By the subscribers to memorandum of association
By deeming the subscribers to the memorandum
as the first directors
By the company in general meetings
By the board of directors
By third parties
By the principle of proportional representation
By the central government
8. Number of directorship
Whole-time Directorship
A person cannot be appointed as a
whole-time director in more than one
company.
Part-time Directorship
Not more than 15 companies
excluding the directorships of,
9. Contd………….
private companies [other than
subsidiaries or holding
companies of public
company(ies)].
i. unlimited companies,
ii. associations not carrying on
business for profit or which prohibit
payment of a dividend, and
iii. alternate directorships (i.e., he is
appointed to act as a director only
during the absence or incapacity of
some other director).
10. Duties of DIRECTORS
1. Fiduciary duty
Exercise powers honestly and bona fide for the
benefit of the company
They must not make any secret profit out of their
positions
1. Duties of care, skill and diligence
Directors should carry out their duties with
reasonable care and skill,deligence
Standard of care: depending upon nature of work,
division of power, customs and remunarations
11. Other duties
To attend board meetings
Not to delegate his functions except to the extent
authorized by the act or constitution of company
To disclose his interest
12. POWERS OF DIRECTORS
General powers of board
Powers to be exercised at board
meetings
Powers to be exercised with the
approval of company in general
meetings
Political contributions
13. Liabilities of directors
Liability to third party
Liability to company
Liability to breach of statutory duties
Liability of acts of his co-directors
De facto and De jure liability
14. REMOVAL OF DIRECTORS
Directors can be removed by
1. Share holders
2. Central government
3. Company law board
15. Disqualification of directors
A person with unsound mind
An un discharged insolvent
Person who has applied to be adjudicated as
an insolvent and his application is pending
before court of law
Person convicted by court for moral turpitude
Person disqualified by order of an court to act
as director
A person who failed to pay call money, on his
shares for six months from date the call
became due
16. Disqualifications……………
a person who is already a director of a
public company which,—
(i) has not filed the annual accounts and
annual returns for any continuous three
financial years commencing on and after
the first day of April, 1999; or
(ii) has failed to repay its deposit or interest
thereon on due date or redeem its
debentures on due date or pay dividend
and such failure continues for one year or
more.
17. Meetings
Key and important matters of the
company are discussed here.
18. Types of meetings
1)General meetings of shareholders.
a) Statutory meeting: (sec 165)
b) Annual general meeting: (sec. 166
& 167)
2)Extra-ordinary general meeting (sec.
169).
3)Meeting of creditors and debenture
holders.
20. AUDITOR
The auditor is the servant of the
shareholders entitled with the duty to
examine the affairs of the company,
on their behalf and report to them
what he has found
He is the only safeguard which the
shareholders have against enterprise
21. Qualification
Member of a Institute of Chartered
Accountants of India
A firm with all partners being members
of ICAI, and any partner may act as
auditor in the name of firm
22. DISQUALIFICATIONS:
As per Sub section (3) of Section 226 , none of
the following persons shall be qualified for
appointment as Auditor of a Company.
a) Body corporate
b) An officer or employee of the company
c) A person who is a partner, or who is in
the employment, of the officer or employees
of the company
d) A person who indebted to the
company for an amount of more than
Rs.1000/-
23. A person who has given any guarantee
or provided any security in connection
with the indebtedness of any third
person to the company for an
amount exceeding Rs,1000/-
A person holding any security of that
company ( After a period of one year
from the date of commencement of the
Companies (Amendment ) Act, 2000)
For the purpose of security means an
instrument which carried voting rights.
24. According to Sub section (4 ) of Section
226 provides that if a person disqualified as a
Auditor for the reasons enumerated in sub
section (3) of Section 226 then he cannot be
appointed as Auditor of any body
corporate which is
1) A subsidiary of that company or
2) Holding company of that company or
3) A subsidiary of that company’s holding
company
25. Appointment of First Auditor
According to sub section 5 of Section
224, the board is vested with power to
appoint first auditor within one month
of incorporation of the company. The
date of appointment to be within one
month from the date mentioned in
Certificate of incorporation issued by
Registrar of Companies i.e. existence
of the company from date i. e legal
entity.
26. Certificate to be obtained
under Section 224 (1B)
This provision will not be applicable to Private company on
and after the commencement of Companies (Amendment)
Act, 2000 . The public limited companies are supposed to
receive the certificate from the Auditor before appointment
that if they are appointed as a Auditor of the Companies the
appointment will be within limits specified in sub section (1B)
of Section 224 of the Companies Act, 1956.
Explanation to Specified number
There are two categories
a) A person or firm can audit twenty such companies have
paid up capital of less than Rs.25 lakhs
b) In any other case in the specified limit, out of twenty
companies not more than 10 shall be companies each of
which has a paid up share capital of Rs.25 lakhs or more.
27. Rights of an auditor
Right to access books
Right to obtain information and
explanation from officers, directors etc
Right to visit branch office at all times
and access books,reciepts,vouchers
etc
Right to receive notice and other
statements relating to general
meetings
Right to receive remuneration
28. Duties
Acquaintance with articles of
companies act
Report to members in general meeting
Examine trueness of balance sheet
and profit and loss account, if any
misuse of funds found by him report
same to shareholders
Be honest, perform his duty with care
and caution
29. Special audit
The central government may in certain cases
direct special audit:
If it shall have a opinion that ,the affairs of
company is not being managed with sound
business principle or prudent business
practices
Practices of company likely to cause serious
injury or damage to trade, industry
The financial position of company is such as
to endanger its insolvency
Special audit can be conducted by appointed
c.a by government or by company auditor if
government directs him.
30. Company secretary
As per sec2(45) a company secretary
is a person who is a member of
Institute of Company secretaries of
India or any other person possessing
the required qualifications, appointed
to perform duties imposed on him by
the companies act, the ministerial or
administrative duties and managerial
functions that are delegated to him by
the board
31. qualification
According to the
companies(appointment and
qualifications of secretary)rules1993,
every company with a paid up share
capital of rs 50lakh or more shall have
a whole time secretary, who is
member of ICSI(Institute of Company
Secretaries of India)
32. Other qualifications
Sound general education
Command of language
Knowledge of office administration
Knowledge of procedures of meetings
Knowledge of accounts
Knowledge of banking and finance
Knowledge of company law
Various labour laws
Taxation laws
Knowledge of industry and general
managerial ability
33. DISMISSAL OF SECRETARY
Expiry of term of appointment
Insanity of secretary
Insolvency
Permanent disability
Serious incompetence
Breach of terms of contract on part of secretary
Gross negligence
Willful disobedience of lawful orders
Misconduct
Moral turpitude
Dishonesty, fraudulent practices
Making of secret profits
34. Rights and powers of auditor
Right of access to books.
Right to obtain information and
explanation.
Right to visit branch offices and
access of branch books.
Right to receive notice of general
meetings and to attend them.
Right to receive remuneration.
35. Remuneration of auditors
It shall be fixed by the directors in a
general meeting.
Any sums paid by the company in
respect of the auditor’s expenses shall
be deemed to be included in the
remuneration.
36. WINDING UP OF COMPANY
The legal process by which a joint stock
company is brought to an end, that is
completely closed down, is called
liquidation
In other words, Liquidation is a process
by which a business of company is
wound up
And in the course of winding up, its
assets are realised,liabilities are paid off
and the surplus if any, is distributed
among the members in accordance with
37. Modes of winding up
Compulsory winding up or winding up
by order of the tribunal
Voluntary winding up
Winding up subject to the supervision
of the tribunal
38. Circumstances leading to
Compulsory winding up
If the company has passed a special
resolution that it should be wound up by
tribunal
If a public company has failed to hold
statutory meeting or file statutory report to
registrar of companies
If it has not commenced business within year
of its incorporation
If the number of members has fallen below
seven in case of public company and below 2
in pvt ltd
If the company is unable to pay debts
If the tribunal is of the opinion that it is just
and equitable that the company should be
wound up
39. Voluntary winding up
Winding up which is brought about
voluntarily without interference of the
tribunal of companies through any
order, but winded up voluntarily by
members of company or by the
creditors
Voluntary winding up is of 2 types:
Members voluntary winding up
Creditors voluntary winding up
40. Circumstances of voluntary
winding up
When company is solvent, and winding
up decision is brought in by members.
When the period for which the company
has been formed has expired and
company has passed ordinary resolution
When the event on happening of which
the company should wound up has
occurred and company has passed
ordinary resolution
When a company has passed a
resolution that it should wound up
voluntarily
41. Winding up subject to
supervision
If a member or creditor puts an application for
supervision of tribunal, after company has
passed special resolution for voluntary
winding up, tribunal can entertain the same
and pass such order to protect interest of,
company, members and creditors.
Tribunal can exercise full control over winding
up of company
Can appoint new liquidator in the place of
existing liquidator
Can put restrictions on existing liquidator
Or appoint additional liquidator to act on
behalf of tribunal, along with existing
liquidator