Lect 1 Corporate Law

8/11/2019 Lect 1 Corporate Law

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Corporate law

Presented by - Gulnaz Khan


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Internal evaluation - 40 marks

1) 20 marks Class Participation , Attendance, regular test2) 10 marks Class test after 9thlecture

3) 10 marks group presentation

Semester End Written Exam - 60 marks

Basic Instructions


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1) Incorporation of Companies

2) Issue of capital

3) Issue of capital continue

4) Raising of loan

5) Raising of loan continue..

6) Company Management (Meeting and resolution )

7) Company Management (Records, Returns, Accounts, Auditors,

Investigation )

8) Company Management (Records, Returns, Accounts, Auditors,

Investigation ) continue..

9) Company Management (Directors, Managing Director )

10) Class Test

11) Presentation

12) Presentation

13) Presentation

Chapters of Corporate law


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1) S.M SHAH COMPANY LAW

2) AVATAR SINGH COMPANY LAW

3) GUIDE TO ACT BY RAMAIAH

4) COMPANY LAW BY BULCHANDANI

5) Many more books available in library

References


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Corporate law

Law:

law is a systemof rules and guidelines which are enforced through socialinstitutions to govern behavior. Laws are made by governments,specifically by their legislatures. The formation of laws themselves maybe influenced by a constitutionand the rightsencoded therein.

Corporate law:

I. "company" or "corporations

II. part of a broader companies law( law of business associations)

Company law:

o 1882 first act in India, 1913 replaced, ICA 1956

o Accounts of companies, inter corporate loans, regulation act SEBI
http://en.wikipedia.org/wiki/Systemhttp://en.wikipedia.org/wiki/Governmentshttp://en.wikipedia.org/wiki/Legislatureshttp://en.wikipedia.org/wiki/Governmentshttp://en.wikipedia.org/wiki/Constitutionhttp://en.wikipedia.org/wiki/Constitutionhttp://en.wikipedia.org/wiki/Legislatureshttp://en.wikipedia.org/wiki/Rightshttp://en.wikipedia.org/wiki/Constitutionhttp://en.wikipedia.org/wiki/Rightshttps://en.wikipedia.org/wiki/Companies_lawhttps://en.wikipedia.org/wiki/Companies_lawhttp://en.wikipedia.org/wiki/Rightshttp://en.wikipedia.org/wiki/Constitutionhttp://en.wikipedia.org/wiki/Legislatureshttp://en.wikipedia.org/wiki/Governmentshttp://en.wikipedia.org/wiki/System


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1) Incorporation of Companies

1) Company

2) Features of a company

3) Procedure for Formation of a company

4) Procedure for changing the name of a company

5) Types of companies

6) Memorandum of association

7) Articles of association


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1) Company

A company is defined as a voluntary

incorporated association which is artificial

person, created by law with limited liability

having a common seal and perpetual

succession.


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2) Features of a company

1) Registration

2) Distinct Person(Separate legal entity)

3) Perpetual Succession

4) Artificial Person but not a citizen

5) Transferrable shares

6) Limited liability7) Common seal

8) Separate property


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3) Procedure for Formation of a company1) Approval of Name

Asset and identity of company

Criteria for approval of name:

Name should not be identical or should not too nearly resemble the name

of another registered company

Should not to be Considered undesirable by central government (section

20(1))

Prevention and improper use act 1950, not violate .e.g. UNO, MAHATMA

GANDHI,PRIME MINISTER OF INDIA, NATIONAL FLAG etc.

2) Submission of memorandum of association

3) Submission of Articles of association

4) Power of attorney for correcting MOA & AOA

5) Statutory declaration of compliances

6) Filing fees

7) Certificate of incorporation

8) Certificate of commencement of business


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Company organizationshare holder

(real owners)

Decide major policiesMeet once in year AGM

More meeting if required

Minimum 2 & maximum 50 members (private company)

Minimum 7 & maximum unlimited (public company)

Board of director

Overall control over the company affairs

Meet minimum 4 times a year, more if required

Minimum 2 directors for private & 3 for public company

Maximum 12 directors. More with permission of central government

Managerial personnel

Managing director/ manager

Managing day to day matters subject


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Difference between Company and Partnership Concern

Partnership Company

Registration: Registration of firm is not

compulsory.

Registration : registration of a company is

compulsory under Company Act 1956.

Membership : Minimum two persons

constitute a partnership .maximum

membership in case of partnership doing

banking business is ten persons and for other

business is twenty persons.

Membership : Minimum two and maximum

fifty constitute a Private Limited company

and For public Limited Company minimum

seven and maximum unlimited constitute its

requirement.

Legal Status: A firm has no separate legalstatus.

Legal Status : A company has a separate legalexistence of its own.

Management: Management are in the hands

of the Partners.

Management: Management are in the Board

of Directors which is elected by Shareholders.

Existence: Partnership has no perpetual

existence.

Existence: Company has a perpetual

existence.Liability: Partners of the firm are liable to

Unlimited extent in Partnership there is an

Unlimited Liability.

Liability: The Liability of the Shareholders is

generally limited.

Death: Death of the Partner may mean

dissolution of the Partnership.

Death: Death of the Shareholder does not

effect the existence of the company.


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4) Procedure for changing the name of a

company

1) Board meeting for deciding the agenda for change in name

( LIC Ltd)

2) Seeking name availability for proposed new name from ROC(with fees)

3) Approval of members in general meeting

4) Registration of Special Resolution with ROC through form-23(Section-192)

5) Filing of form-1B with ROC u/s 21


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Types of Company

Royal charteror chartedcompany

Statutorycompany

Registeredcompany

Company LTDby shares

Privatecompany

Publiccompany

Company LTDby guarantee

Unlimitedcompany


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5) Types of companies

1) Royal Charter or Chartered Companies

Example east India company

2) Statutory Companies

Provide public services

Example gas, water, electricity etc.

3) Registered Companies


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Registered Companies

1) Companies Limited by Shares

Limited liability, share capital, share

Two types:

i. Private limited company

ii. Public limited company

2) Companies Limited by Guarantee

Dont have share capital

Member pay sum fixed amount (winding up)

Called guarantee

3) Unlimited Companies

Unlimited liability

Example ordinary partnership firm


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Companies Limited by Shares

1) Private limited company:-

Minimum 2 maximum 50 members

Minimum 2 directors

Restrictions on transferability of shares

Not issue prospectus

Not invite public for share capital Many procedural activity

2) Public limited company:-

Minimum 7 maximum unlimited members Minimum 3 directors

Issue prospectus

Invite public for share capital

Listed company follow SEBI


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6) Memorandum of association Constitution of company

Benefit of creditors shareholder

A. Clauses of Memorandum of association1. Name clause

2. Registered office clause

3. Object clause (trading and non-trading company)

4. Liability clause

5. Capital clause6. Subscription clause (details about members like name and address)

B. Alteration of Memorandum of association1. Change in Name clause

2. Change in Registered office clause

Change within same city (section 146, form no 18) Change within same state (section 146, form no 23)

Change to another state (section 17(1)with reason with permission of CLB thatis company law board)

3. Object clause (section 17(1))4. Liability clause (section 32(3)), (does not arises)

5. Capital clause ( if AOA changes, with special resolution in general meeting


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7) Articles of association

A. Meaning:

Rules regarding internal management

Authorities and responsibilities of members, directors, manager etc.

B. Alteration of Articles of association AOA can not to be against of MOA

Must be bona fide for the benefit of company

Company cant not justify breach of contract by AOA.

AOA cant change private company to public company.

Cant include anything which is illegal or oppose to public policy.


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Thank you ..

Documents

Lect 1 Corporate Law