Indian companies are governed by Companies Act 1956 and company has to comply with various statutory provisions as per different sections of Companies Act 1956. Services offered by us include:
A company is one which is registered under the provisions of the Companies Act 1956 (Companies Act). A company may be either a private company which by its constitutional documents, restricts the right of its members to transfer their shares in the company, prohibits invitation to the public to subscribe to its shares, debentures or other securities or to invite deposits from the public and which limits the total number of its members to 50 or a public company which does not have prohibition as to transfer of shares or restriction on number of shareholders.
The Companies (Amendment) Act, 1999 introduced provisions relating to buy-back of specified securities by a company (Companies Act, sec 77A, 77 AA and 77B). Regulations have been laid down by the Securities and Exchange Board of India (SEBI) in relation to the buy-back of shares by listed companies and by the Central Government in relation to other companies. A company may also issue sweat equity shares of a class of shares already issued under certain conditions specified under the newly inserted sec 79 A. Section 372A has been inserted to provide for the regulation of inter-corporate loans and investments. Companies may give loans, invest monies or provide guarantees or securities of up to 60% of aggregate of its paid-up share capital and free reserves or up to 100% of its free reserves, whichever is more, without shareholder approval. A higher amount is permitted with shareholders’ approval.
All private and public companies are required to have a minimum paid-up capital of INR 100,000 and INR 500,000 respectively. Incase certain key words like manufacturing, India, etc, are to be used, then there are additional minimum paid-up capital requirements.
The share capital of a company may be of two types, namely, equity share capital and preference share capital. The equity share capital may be issued with voting rights or with differential rights as to dividend, voting or otherwise in accordance with the rules and subject to such conditions prescribed by the Companies (Issue of shares with Differential Voting Rights) Rules, 2001. The preference share capital enjoys a preferential right in the payment of dividends during the lifetime of the company and repayment of capital when the company is wound up. The preference share can be of the following types:
A public company may issue equity shares with differential rights as to dividends, voting or otherwise in accordance with the rules made in that behalf. This amendment would help management to raise capital without diluting control by issuing shares without voting rights. At the same time, investors would have the benefit of receiving dividends and bonus shares.
A company proposing to shift its registered office from one state to another is required to pass a special resolution (resolution passed with three-fourths majority) at a meeting of its shareholders in addition to obtaining the confirmation of the Central Government to that effect. A company proposing to change the place of its registered office from the jurisdiction of one Registrar of Companies to the jurisdiction of another Registrar of Companies (RoC) within a state will have to obtain confirmation from the Regional Director. The Regional Director is required to confirm the change within four weeks of receipt of the application. The company is required to file with RoC, the certified copy of the order of the Central Government or, as the case may be, certified copy of the confirmation of the Regional Director. The RoC is required to register the same and certify the registration within one month from the date of filing the documents.
Subject to the provisions of sec 77A, a company may buy back its own securities up to a maximum extent of 25% of its paid-up share capital in any financial year, subject to fulfilling certain conditions. A company may also issue sweat equity shares of a class of shares already issued subject to certain conditions specified under sec 79A.
At every annual general meeting of a company, the company is required to lay a balance sheet and a profit and loss account. The profit and loss account shall relate to the financial year of the company and the balance sheet, as at the end of the financial year. The financial year cannot exceed 15 months. However, it can be extended to 18 months with the special permission of the RoC.