person", invisible, intangible, created under law, with a discrete legal entity, perpetual succession and a common seal. Corporate Personality
Common Seal
Limited Liability
Perpetual Succession
Separate Property
Transferability of Shares
Capacity to Sue and Be Sued
The Indian company law begun with the companies act 1850, modeled on British companies act 1844 The Indian Companies act of 1913 was based on the British Companies act of 1908 The Indian Companies act, 1956; April 1, 1956 The Indian Companies act, 2013 Passed in Lok sabha: December 18, 2012
Passed in Rajya Sabha: August 08, 2013
Total number of sections: 470
Total number of chapters: 29
Total number of schedules: 7
Effective from September 12, 2013
J.J Irani Committee
To promote the development of the economy
To encourage transparency and accountability
To promote high standards of corporate governance
To recognize new concepts and procedures to support
business while protecting interests of all the stakeholders
To set up institutional structure in the form of various
authorities, bodies and panels (NCLT and NCLAT)
To enforce stricter action against fraud and gross non -
compliance with company law provisions One Person Company is a hybrid of Sole- Proprietor and Company form of business, and has been provided with concessional/relaxed requirements under the Act. Associate company in relation to another company, means a company in which that other company has a significant influence, but which is not a subsidiary and joint venture company
Significant influence means control of at least
twenty per cent of the total share capital, of business decisions under an agreement Where a company is formed and registered under the new law for the future project of to hold an asset of intellectual property.
Inactive company is one which has not been carrying
on any business operation, or has not made any significant accounting transaction, or has not file financial statements and annual returns during for the last two financial years. Every listed company shall appoint at least one woman director Every other public company having paid up share capital of Rs. 100 crores or more or turnover of Rs. 300 crore or more as on the last date of latest audited financial statements, shall also appoint at least one woman director. Mandatory rotation of auditors for the listed and other specifies class of companies
Individual auditor to be rotate after a term of five
consecutive years
Audit firm to be rotate after two terms of five
consecutive years Vigil (Whistle Blower) mechanism provides a channel to the employees and directors to report to the management concerns about unethical behavior, actual or suspected fraud or violation of the Codes of conduct or policy. Secretarial Audit is a process to check compliances made by the Company under Corporate Law & other laws, rules, regulations, procedures etc. It is a mechanism to monitor compliance with the requirements of stated laws and processes. The Act simplified procedure for merger and amalgamation of certain class of companies such as holding and subsidiary and small companies Minimum Capital Requirement: Private or public company can be incorporated without the need for minimum paid up share capital
Common Seal: The requirement of having common seal
made optional Declaration of Dividend: no company shall declare dividend unless carried over past losses and depreciation in previous year or years are set off against profit of the company for the current year