CS Final :: Advanced company law & practice : June 2005

Comment on the following :

Appeal, application, petition and reference can be used interchangeably in the context of Company Law Board proceedings.

Requisite majority to approve a scheme of arrangement or compromise under section 391(2) is three-fourths of the total value of the shareholders/creditors of the company concerned.

It is mandatory for all companies to make management discussion and analysis report as a part of the Board’s report to the shareholders.

On joining Zig Zag Ltd. as its Company Secretary, you found that the balance sheet as at 31st March, 2003 and the annual return related thereto have not been filed with the Registrar of Companies. What steps would you initiate to avoid commencement of penal proceedings ?

An order has been passed by the Company Law Board under section 397 against your company which is considered inappropriate by the management. What action would you take in such a situation ?

A large block of shares has been purchased in your company by a group which is in a business in direct competition with a line of business undertaken by your company. What action can you take to prevent registration of such shares in the name of the acquirers ?

What are the circumstances under which there is an effective reduction of capital, but no confirmation of the court is required ?

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What are the circumstances under which there is an effective reduction of capital, but no confirmation of the court is required ?

(i)	Inspection under section 209A and investigation under section 235/237 are the same.
(ii)	‘Insider’ cannot deal in the shares of the company concerned.
(iii)	Public limited company is the most appropriate form of organisation for business.
(iv)	The trend of concentration of equity ownership in the hands of institutional investors is harmful for corporate entities.

Briefly discuss the recommendations of the Naresh Chandra Committee Report on compulsory audit partner rotation.

Explain the powers of the High Court under the Companies Act, 1956 to carry out the compromise or arrangement between the companies.

The Central Government is vested with various functions for ensuring proper development and efficient functioning of the corporate sector as prescribed under the provisions of the Companies Act, 1956. Elaborate these functions.

Roxy Ltd. proposes to take disciplinary action against its secretarial officer whom the company alleges of disclosure of certain information during the course of investigation ordered by the Company Law Board (CLB). The CLB decides to object the same. Clarify the procedure to be adopted by the CLB and remedy available to the company.

State whether a company can avail exemption from preparation of accounts in format other than prescribed under ScheduleVI of the Companies Act, 1956. Answer with reasons.

Describe the procedure for registration of an existing company under Part-IX of the Companies Act, 1956.

State the circumstances under which the Registrar of Companies can seize the books and papers of a company.

A few days after a scheme of arrangement filed by Tarzon Ltd. is sanctioned by the court, majority of the directors/promoters of the company concerned are indicted by the SEBI of certain wrong doing jeopardising the implementation of the scheme. Advise.

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Draft a resolution to be passed at a general meeting authorising the Board of directors to buy-back shares of your company. (You may assume circumstances, sources and quantum.)

Humlog Ltd., a shareholder in Biglog Ltd., challenges in the court compounding of an offence under section 211 being punishable with imprisonment or fine or with both by Biglog Ltd., by filing a petition to the Company Law Board (CLB) under section 621A on the ground that CLB should have taken the court’s permission before compounding ?

UR Ltd. has secured the approval of members for a compromise with its institutional lenders and is in the process of filing necessary papers with the court. Shramik, who is employed in UR Ltd.’s factory and is in the process of lodging a transfer of 100 shares for registration in his name, wants to intervene. Advise him.

Mention the salient features of the Sarbanes-Oxley Act, 2002 of the United States of America.

Inspection of the books of accounts of Joy Ltd. revealed that certain statutory provisions of the Companies Act, 1956 were violated and hence a notice was issued to that effect. JoyLtd. pleaded that violation was not wilful. However, a further notice was issued to Joy Ltd. to show cause why action should not be taken agaist it pursuant to section 628. Joy Ltd. filed a petition to the court praying for relief under section 633. Will the court grant relief ?

Fly High Ltd., a listed company, forfeited 15,000 equity shares of Rs.10 each on which only Rs.2.50 towards application and allotment has been paid, for non-payment of call money due thereon and now proposes to re-issue the said shares to the promoters at Rs.7.50 per share. What would be the issues involved in implementing the proposal ?