Class action is one of the youngest additions to indian jurisprudence particularly, in indian corporate jurisprudence. Dec 24, 20 merger or amalgamation of a company with foreign company section 234. Dear professional colleagues,in this article, i will be dealing all about preference shares under companies act, 20applicable section section 55 issue and redemption of preference shares effective from 1st april, 2014, except sub section 3 which is effective from 1st june, 2016 applicabl. Aholding company section 246 can avail the benefit of this section for merger of its whollyowned subsidiary section 287 into itself. Chapter xv section 230 to 240 of companies act, 20 the act contains provisions on compromises, arrangements and amalgamations, that covers compromise or arrangements, mergers and amalgamations, corporate debt restructuring, demergers, fast track mergers for small companiesholding subsidiary companies, cross border mergers, takeovers, amalgamation of. In the course of his work, a company secretary is expected to have the working knowledge of company accounts.
Major decisions taken by the members in pursuance to section 180 of the companies act, 20 iv merger amalgamation reconstruction, etc. Faqs on companies act, 20 2nd edition the companies act, 20 series. Act, 20 thought it fit to bring out this ready referencer on companies act, 20, as a self learning aid to understand the basic tenets of the new act. The 20 act features some new provisions in the area of mergers and acquisitions, apart from making certain changes from the existing provisions.
Best business future mergers and acquisitions in india educba. The 20 act is more of a rulebased legislation containing only 470 sections, which means that the substantial part of the legislation will be in the form of rules. Jun 16, 2016 a merger is commonly done for mainly expansion purposes as to broaden the horizons while making an entry to new segments in furtherance of gaining market share, which is done for the purpose of pleasing the companys shareholders and create value. Companies bill 2012 became the companies act, 20 act 18 of 20. The 20 act introduces a new type of entity to the existing list i. Section 231 explains the power of tribunal to enforce compromise or arrangement.
Can be a public or private company or a section 8 company. Icsi frequently asked questions on companies act 20. It says several pertinent and relevant queries with regard to the companies act, 20 have been received from the stakeholders. Pursuant to section 2041 of the companies act, 20 and rule no. The provision of this chapter shall also apply to the scheme of mergers and amalgamations between companies registered under the companies act, 20 and companies incorporated in the jurisdictions of such countries as may be notified. Section relating to merger and amalgamation under companies act, 20 are 230 and 232. All about memorandum of association moa under companies act, 20. It oversees the management of the company to ensure that the interest of noncontrolling shareholders is protected. Government makes rules relating to merger or amalgamation. The 20 act is clarifies that merger of a listed company with an unlisted company would not automatically result in the. Download the companies act 20 notes by icsi for all ca cma cs students.
Services of secretarial auditor as per the requirements of companies act, 20, compliance audit and due diligence reporting. The indian companys act 20 a boon or bane to sustainable. Mca has revised the procedure of striking off the name of the company from the register of companies maintained by the registrar of companies vide its notification dated 26th december 2016 on notifying section 248 to 252 of the companies act, 20. The pdf file you are about to download is not created by writinglaw.
The different provisions of the 20 act are being brought into effect in phases. Pdf companies act 1956 and 20 pdf download, high quality. Mar 01, 2017 central government may refer the scheme to nclt for considering the scheme under section 232 of the companies act, 20 as a normal merger. It helps in the overall process of acquisitions, mergers and restructuring, facilitate domestic and crossborder mergers and acquisitions. Merger control 2020 laws and regulations india iclg. Chapter xv section 230 to 240 of companies act, 20 the act contains provisions on compromises, arrangements and amalgamations, that covers compromise or arrangements, mergers and amalgamations, corporate debt restructuring, demergers, fast track mergers for small companies holding subsidiary companies, cross. The act came into force on 12 september 20 with only 98 provisions of the act notified. Amended provisions for appointment of whole time cs.
The companies act 20 is an act of the parliament of india, divided into 29 chapters containing 470 sections and has 7 schedules. The act has replaced the companies act, 1956 after receiving the assent of the president of india on 29 august 20. There are over 180 sections in the 20 act where rules have been prescribed and the draft rules were released by the mca in three batches. Checklist under companies issue of indian depository receipts rules, 2004 212 sebi icdr regulation 2009 216 listing agreement for idrs 219. Ready reckoner for private companies the companies act, 20 series tds ready reckoner. The companies act, 20 has provided for fast track mergers, wherein certain classes of companies can merger as per the provisions laid down under section 233 of the companies act, 20. Companies act, 1956 or form dir12 under the provisions of the companies act, 20 has already been filed, shall mandatorily be required to generate ecsin on or before 31st december, 2019 or such other time and date as may be specified by the icsi. Icsi is the only recognized professional body in india to develop and regulate the profession of company secretaries in india.
Regulation 21zmof lodr subsidiary company or subsidiary, in relation to any other company that is to say the holding company, means a company in which the holding company i controls the composition of the board of directors. The companies act 20 notes by icsi for all ca cma cs. Legal procedure for merger of companies racolb legal. The merger provisions are contained in chapter xv of the companies act, 20, containing sections 230 to 240, which deals with compromises, arrangements and amalgamations. Not required for merger by absorption or if the requirement is. Chapter xv of the 20 act, sections 230 to 240 deal with compromises, arrangements and amalgamations. Substantively a law based on rules as may be prescribed. Ebook on companies act 20 in pdf april 2020 edition. Different provisions of the companies amendment act, 2017 including any amendments, references in any. Introductory while framing a scheme of merger or amalgamation, a company has to fulfill the conditions prescribed under the company law as already discussed, but it has also to look after one very important aspect i. The companies act 20 is an act of the parliament of india on indian company law which regulates incorporation of a company, responsibilities of a company, directors, dissolution of a company.
A critical analysis on 7th december 2016 the ministry of corporate affairs notified 90 sections of the companies act, 20 and these were made effective from 15th december, 2016. The act comprises of 29 chapters, 470 clauses with 7 schedules as against 658 sections and 14 schedules in the companies act, 1956. A paradigm shift for the corporate the companies act, 1956 thrissur chapter of sirc the companies act, 20 2 3. Chapter xv section 230 to 240 of companies act, 20the. The table below sets out the procedure for fast track mergers together with the timeline specified. Section 230 of companies act, 20 corporate law reporter. Ministry of corporate affairs mergers and acquisitions.
In the context of the provisions of the companies act, 1956, there is no difference between regular merger and reverse merger. Mergers, corporate restructurings, corporate debtrestructurings. Section 173 of the companies act, 20 directors meeting of board revised ss1 revised secretarial standard on meetings of board of directors the notification icsi no. Mar, 2017 thus it may be concluded that the procedure for amalgamation under the companies act 20 is on the same lines as the one prescribed under the companies act 1956 except for a few changes.
Increase in number of companies from approximately 30,000 in the year 1956 to 11,00,000 in the year 20. Appointment of company secretary companies act 20 yourstory. Mergers and acquisitions ministry of corporate affairs. This book in its pdf form is available for download. Download the companies act 20 pdf book in legislative department websites and in other web portals. This is the first significant change to merger and amalgamations regime over the last six decades which has subserved the need of simplification of procedure. All about preference shares under companies act 20 by cs. Section 232 of companies act, 20 deals with the procedure of merger and amalgamation. Section 234 specifically deals with the crossborder mergers concerning merger or amalgamation of an indian company with a foreign company and viceversa background. Merger control laws and regulations india covers common issues in merger control laws and regulations including relevant authorities and legislation, notification and its impact on the transaction timetable, remedies, appeals and enforcement and substantive assessment in 55 jurisdictions. The 20 act seeks to replace the companies act, 1956 1956 act. Board meeting as per companies act, 20 and secretarial standard issued by icsi the board of director of the company is primarily an oversight board. The companies act, 20 has introduced the ingenious concept of fast track merger for small companies and merger of holding companies with its wholly owned subsidiary companies.
Government makes rules relating to merger or amalgamation of a foreign company with an indian company and vice versa 17 april 2017 background in a significant development, the government has notified1 the commencement of section 234 of companies act, 20 the act as april 2017. During the debate of companies amendment bill, 2019, honable mp shri naresh gujral. The companies act, 1956 consolidates provisions relating to mergers and acquisitions and other related issues of compromises, arrangements and reconstructions, however other provisions of the companies act get attracted at different times and in each case of merger and acquisition and the procedure remains far from simple. Major areas of compliances under companies act, 1956 316. Approval of the matter relating to amalgamation, merger, demerger, acquisition and takeover. In this chapter, the act consolidates the applicable provisions and related issues of compromises, arrangements and amalgamations. Workshop on insolvency and bankruptcy code, in delhi, hosted by icsinirc. Companies act, 20 new rules of the game 5 companies act, 20 background companies act, 20 20 act has been assented by the president of india on 29 august 20 and published in official gazette on 30 august 20. The subject company accounts and auditing practices is very important for the students. Notification of rules for amalgamations involving foreign.
Merger and amalgamation under companies act, 20 taxguru. No specific provision in the act 62 1 c form pas 3 form pas 3 sr required property and assets required goodwill. Class action aims to prevent oppression and mismanagement in companies. Merger regime under the companies act, 20 introduction merger is a restructuring tool available to indian conglomerates aiming to expand and diversify their businesses for various reasons whether it is to gain competitive advantage, reduce costs or unlock values. Aug 31, 2015 the merger and amalgamation of corporate constitutes a subject matter of the companies act, the courts and law and there are well laid down procedures for valuation of shares and rights of investors. The ready referencer introduces readers to the new concepts in the companies act, 20 and lists out the salient features, of the law in a capsule form. A merger is a combination of two companies where one corporation is completely absorbed by another corporation. The companies act, 20 received the assent of the president on 29th august, 20 and was notified in the gazette of india on 30th august, 20. The concept of merger and amalgamation was not popular in india till 1988. Checklist of fast track merger under companies act, 20 by cs manoj purbey. Compliance calendar seeks to provide research based blogsarticles and experts views on various critical topics and burning issues completely free with zero subscription cost while at the same time, we insist on providing uptodate information to our corporate fraternity and professionals like cscacmalawyers, students and the layman. Section content effective date some of the subsections of these sections have been notified on different dates. Companies act, 20 icsi thrissur directors, meetings. Merger and amalgamation of companies effective from 15th december, 2016 1 where an application is made to the 2tribunal under section 230 for the sanctioning of a compromise or an arrangement proposed between a company and any such persons as are mentioned in that section, and it is shown to the 2tribunal a.
Workshop on secured lending with focus on sarfaesi and bankruptcy code. Sebi streamlines norms for mergers involving listed companies. The companies act, 20 companies act is one of the landmark legislations enacted in recent years to bring forth transparency, ease of doing business and protecting rights of minority shareholders. Companies act, 20 bare acts law library advocatekhoj.
Government makes rules relating to merger or amalgamation of. General procedure for amalgamation under companies act 20. These will pick you to the height in your knowledge in the matter of companies as well as provides the opportuinites to familirize youself with the new. The appointment of company secretary cs has been made mandatory under the companies act 20 for a few categories of companies. Checklist of fast track merger under companies act, 20. Companies act, 1956 or eform dir12 under the provisions of the companies act, 20 has already been filed or the members who are otherwise employed upto and including 30th september, 2019 shall mandatorily be required to generate ecsin on or before 31st december, 2019 or such other time and date as may be specified by the icsi. Souvenir golden jubilee year national convention of company secretaries 46th edition and international conference 6th edition. Towards the proper implementation of the companies act 20, the first tranche. The institute of company secretaries of india icsi is constituted under an act of parliament i. The companies act was, in many ways, perceived as a reaction to the satyam scam which uncovered several aspects of corporate fraud that inter alia diminished minority shareholder rights. Icsi the institute of company secretaries of india released its frequently asked questions faqs on the companies act 20 on 25 th june 2014.
Both the transferor and the transferee company shall make an application in the form of petition to the tribunal under section 230232 of the companies act, 20 for the puspose of sanctioning the scheme of amalgamation. Central government may refer the scheme to nclt for considering the scheme under section 232 of the companies act, 20 as a normal merger. Where a merger leads to formation of a new company, acquisition leads to purchase of a company by other and no new company is formed. For a detailed analysis of the concept of reverse merger, refer to gujrat high court judgment in bihari mills ltd. Introductionmore than three years ago, the companies act, 20 20 act was passed by both houses of parliament and received assent of the president of india. New concept introduced in india under the companiesact, 20 no requirement of nclt approval sanction by jurisdictional regional directors based on reports by the registrar of companies and official liquidator is sufficient nonexistence of such provisions under the old companiesact ease of doing business status in other jurisdictions countries. The icsi website addresses frequently asked questions on the companies act, 20. Taking cognizance of the relaxation under section 233 of the 20 act for a fast track merger of a wos with its parent company, the. Section 232 of companies act, 20 merger and amalgamation. Chapter 1 dividends sections 205 207 chapter 2 accounts sections 209 223 chapter 3 audit sections 224 233b chapter 4 power of registrar to call for information,etc.
If you agree then only proceed to download companies act 20 pdf. Section 230 deals with the power to make compromise and arrangement of companies. Companies act in pdf is available for students and professionals. He should also have the working knowledge of auditing concepts. Full text containing the act, companies act, 20, with all the sections, schedules, short title, enactment date, and footnotes. Sep 20, 20 section 232 of companies act, 20 merger and amalgamation of companies nov 05, 2015 section 233 of companies act, 20 merger or amalgamation of certain companies nov 05, 2015 subscribe to the daily journal. In the light of this, the study material has been published to impart. While the changes are aimed at simplifying and rationalising the procedures involved, the new provisions are also aimed at ensuring higher accountability for the company and majority shareholders and increasing flexibility for. File copy of the order with the registrar of the companies in e form inc 28 fast track merger process under companies act, 20 14. Order passed by honble national company law tribunal. In commercial parlance, merger essentially means an arrangement. Jan 12, 2018 the board of securities market regulator sebi has said that the shareholding of prescheme scheme of arrangement for merger public shareholders of the listed entity and the qualified institutional b. Mergers and acquisitions in india mergers and acquisitions as we know imply alliance of two or more companies future.
Different provisions of the companies amendment act, 2017 including any amendments, references in any provisions there in, shall come into force on such date or dates as the central government may, by notification in the official gazette appoints. The companies act 20 question and answers are there in that companies act 20. The study material is based on those sections of the companies act, 20 and the rule made there under which have been notified by the government of india and came into force w. The companies act, 20, new act in its new avatar, mirrors several changes when compared to the law contemplated under the companies act, 1956 old act. Companies act, 20 has seen the light of day and replaced the 1956 act with some. The institute of company secretaries of india icsi, functioning under the aegis of the ministry of corporate affairs, here today launched the icsi primer on companies act 20 on its. By anup koushik karavadi the task of enacting a new law to regulate companies in india is complete. Companies actmergers and restructuring grant thornton india. Cimplyfives text of model resolutions under the companies act, 20. The companies act, 1956 consolidates provisions relating to mergers and acquisitions and other related issues of compromises, arrangements. The students appearing under the old syllabus may refer to soft copies of the study material revised in the light of companies act, 20 for the corresponding subjects under the new syllabus to be uploaded on icsi website shortly.
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