`Introduction In simple words, a company can be defined as a group of persons associated together for the purpose of carrying on a business, with a view to earn profits. However, one must remember that companies may also be formed for the promotion of commerce, art, science, religion or charity or any useful object under the Companies Act. Lord Justice Lindley defines the company as ‘A company is an association of many persons who contribute money or money‘s worth to a common stock and employ it in some trade or business and who share a profit and loss arising there from. The common stock so contributed is denoted in money and is the capital of the company. The people who contribute it or to whom it belongs are members. The proportion of capital to which each member is entitled is his share. The shares are always transferable although the right to transfer is often more or less restricted.’ A company, formed and registered under the Company Act, is regarded by law as a single person, having specified rights and obligations. The law confers on a company a distinct legal personality, with perpetual succession and a common seal. Public Limited Company A public company is defined as a company which is not a private company. The following conditions apply only to a public company: It must have at least seven shareholders. It must have minimum paid-up capital of Rs 5,00,000 It must publish a prospectus or file a statement in lieu of a prospectus before it can start transacting business. A public company is required to have at least three directors. It must hold statutory meetings and obtain government approval for the appointment of the management. A public company is not authorized to start business upon the 1
Transcript
`Introduction
In simple words, a company can be defined as a group of persons associated together for the purpose of carrying on a business, with a view to earn profits. However, one must remember that companies may also be formed for the promotion of commerce, art, science, religion or charity or any useful object under the Companies Act.
Lord Justice Lindley defines the company as ‘A company is an association of many persons who contribute money or money‘s worth to a common stock and employ it in some trade or business and who share a profit and loss arising there from. The common stock so contributed is denoted in money and is the capital of the company. The people who contribute it or to whom it belongs are members. The proportion of capital to which each member is entitled is his share. The shares are always transferable although the right to transfer is often more or less restricted.’
A company, formed and registered under the Company Act, is regarded by law as a single person, having specified rights and obligations. The law confers on a company a distinct legal personality, with perpetual succession and a common seal.
Public Limited Company
A public company is defined as a company which is not a private company. The following conditions apply only to a public company:
It must have at least seven shareholders. It must have minimum paid-up capital of Rs 5,00,000 It must publish a prospectus or file a statement in lieu of a prospectus before it
can start transacting business. A public company is required to have at least three directors. It must hold statutory meetings and obtain government approval for the
appointment of the management. A public company is not authorized to start business upon the grant of the certificate of incorporation. In order to be eligible to commence business as a corporation, it must obtain another document called "trading certificate”.
It must have at least 3 directors. In the case of public company, the directors must file with the registrar consent
to act as a director or sign an undertaking for their qualification shares.
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The essential steps for the formation of a
COMPANY
Before a company can be formed the following steps must be taken:
1. The Memo and the Article must be prepared. These two documents must be filed when the application is made for the registration and incorporation of the company. The Companies Act lays down rules regarding the preparation of the memorandum. Schedule I to the Act of 1956 contains four model forms for use in different cases.
2. If it is proposed to have a paid up capital of more than Rs 3 crores, sanction of the central Government must be obtained under the capital issue (Control) Act, 1956.
3. If the company to be formed intends to participate in an industry which is included in the scheduled annexed to the industries (Development and Regulation) Act, 1951, a license must be obtained under the Act.
4. The company must be registered in accordance with the provision of the companies Act, 1956 and a certificate of incorporation must be obtained.
5. The prospectus or the statement in lieu of prospectus must be issued and registered with the registrar.
6. The minimum subscription must be raised and therefore the allotment of shares must be made.
7. The certificate for the commencement of business must be obtained from the Registrar.
PROCEDURE OF REGISTRATION
For the registration of a company, the following documents, together with the necessary fees, must be submitted to the registrar of companies of the state in which the registered office of the company will be situated-Sec 33.
1. Memorandum of Association, prepared in accordance with provision of the Companies Act, and signed by the least 7 persons in the case of public companies and 2 persons in the case of private companies.
2. The Articles of Association, in case of unlimited companies, companies limited by guarantee and private companies limited by shares.
3. A declaration by any of the following persons, stating that all the requirements of the act have been compiled with an advocate, an attorney a pleader, a chartered accountant, or a person named in the articles as director, manager, or secretary of the company.
4. The duly signed list of persons have consented to be directors of the company, their consent in writing and the signed agreement with every such director to take the number of shares required to qualify as directors of the company. These
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are not required in the case of private companies and the companies not having a share capital.
5. The registration fees of a company are fixed on the graduated scale on the amount of nominal capital or the number of members. There is also a filing fee per document.
If the Registrar is satisfied that all the required documents of the act have been compiled with, he will register the company and issue a certificate called the Certificate of Incorporation
Main Object: To produce cloth of suitable quality textile sector. To multiply such units at locations convenient to cotton rising. To import cotton and export cloth. To assist Government in taking up to increase production of cotton. To establish, extend and re-organize extension centers in collaboration with State
Government or a for improving the quality and increasing the production of cottonOther Object:
To develop new techniques to increase production. To employ and remunerate experts to investigate and examine into the condition,
prospects, value, character and circumstances, of any business of industrial concern or undertaking dealing in industries based on cotton.
To adopt such means of making known the uses of equipment and machinery relating to industries based on cotton pesticides, homicide etc. by advertising in press, publication of books, magazines, periodicals, posters, pictures, instructions on site, holding seminars etc.
To establish training centre where employees can get training.
4. Area of Operation Clause: Phagwara, Jalandhar5. Liability Clause: Limited by shares.6. Capital Clause: Rs,120000000 (Rupees twelve crore only.)7. Association and subscription Clause:
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ARTICLES OF ASSOCIATION
SHARE CAPITAL AND INCREASE AND REDUCTION OF CAPITAL
“The Authorized Share Capital of the company is Rs. 120000000 (Rupees Twelve Crore only) divided into 1200000 (Twelve lacs) Equity Shares of Rs. 100 each (Rupees Hundred each) with powers to increase or reduce the same in accordance with the provisions of the Companies Act, 1956.
Increase of capital of the company The Company in General Meeting, may from time to time, increase its capital by the creation of new shares, such increase to be of such aggregate amount and to be divided into shares of such amounts as the resolution shall prescribe.
Allotment otherwise than for cashSubject to the provisions of the Act and these Articles, the Directors may allot and issue shares in the capital of the Company as payment or part-payment for any property or assets of any kind whatsoever, sold or to be sold or transferred or to be transferred or for goods or machinery supplied or to be supplied or for services rendered or to berendered or for technical assistance or know-how made or to be made available to the Company or the conduct of its business and shares which may be so allotted may be issued as fully or partly paid-up otherwise than in cash and if so issued, shall be deemed to be fully or partly paid as the case may be.
Additional capital to form part of existing capital Except so far as otherwise provided by the conditions of issue or by these presents, any capital raised by the creation of new shares, shall be considered as part of the existing capital.
Redeemable preference sharesSubject to the provisions of Section 80 of the Act, the Company shall have the power to issue Preferential SharesWhich are or at the option of the Company are to be liable to be redeemed and the resolution authorizing such issueShall prescribe the manner, terms and conditions of redemption.
Reduction of capitalThe Company may (subject to the provisions of Sections 78, 80, 100 to 105 inclusive, of the Act) from time to time by Special Resolution, reduce its capital and any Capital Redemption Reserve Account or Share Premium Account in any manner for the time being authorized by law, and in particular, capital may be paid off on the footing that it may be called up again or otherwise
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SHARES AND CERTIFICATESShares to be numbered progressively and no Shares are to be sub-divided: The shares in the capital shall be numbered progressively according to their several denominations and except in the manner herein before mentioned no share shall be sub-divided.
Shares at the disposal of the Directors: Subject to the provisions of these Articles and the Act, the shares in the capital of the Company for the time being (including any shares forming part of any increased capital of the Company) shall be under the control of the Directors who may issue, allot or otherwise dispose of the same or any one of them to such persons in such proportion and on such terms and conditions. The shares can be issued at a discount and at such times as they may from time to time think fit and proper and with the sanction of the Company in General Meeting to give to any person the option to call for or allotted shares of any class of the Company either at par or at premium or subject as aforesaid at a discount during such time and for such consideration and such option being exercisable at such times as the Directors think fit; and any shares which may be so allotted may be issued as fully paid-up shares and if so issued shall be deemed to be fully paid-up shares. The Board shall cause to be filed the returns as to allotment provided for in Section 75 of the Act. Provided that the option or right to call of shares shall not be given to any person except with the sanction of the company in the General Meeting.
Acceptance of sharesAny application signed by, or on behalf of, an applicant for shares in the Company followed by an allotment of any shares therein, shall be an acceptance of shares within the meaning of these Articles; and every person who thus or otherwise accepts any shares and whose name is entered in its Register of Members shall, for the purpose of these Articles, be a member of the Company
Renewal of share certificateNo fee shall be charged for issue of new share certificates in replacement of those which are old, decrepit, worn out. If a share certificate is lost or destroyed, a new certificate in lieu thereof shall be issued only with the prior consent of the Board and on payment of such fee, not exceeding Rupees two as the Board may from time to time fix, and on such terms, if any, as to evidence and indemnity as to payment of such out-of-pocket expenses incurred by the Company in investigating evidence, as the Board thinks fit. When a new share certificate has been issued in pursuance of Clause (c) of this Article, it shall state on the face of it and against the stub or counterfoil to the effect that it is “a duplicate issued in lieu of share certificate No_________.” The word “duplicate” shall be stamped or punched in bold letters across the face of the share certificate.
Calls
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Directors may from time to time, subject to the terms on which any shares may have been issued and subject to the conditions of allotment, by a resolution passed at a meeting of the Board (and not by circular resolution) make such calls as it thinks fit upon the Members in respect of all monies unpaid on the shares held by them respectively and each member shall pay the amount of every call so made on him to the person or persons and at the time and place appointed by the Board. A call may be made payable by installments.
Notice of callsThirty days notice in writing of any call shall be given by the Company specifying the time and place of payment, and the person or persons to whom such calls shall be made.
Calls to date from resolution.A call shall be deemed to have been made at the time when the resolution authorizing such call was passed at a meeting of the Board.
Call may be revokedA call may be revoked or postponed at the discretion of the Board.
Proof on trial or suit for money on sharesOn the trial or hearing of any action or suit brought by the Company against any member or his legal representative to recover any moneys claimed to be due to the company for any call or other sum in respect of his shares, it shall be sufficient to prove:a) That the name of the Member, in respect of whose shares the money is ought to be recovered, appears enteredIn the Register of Members as the holder or one of the holders, at or subsequent to the date at which the moneySought to be recovered is alleged to have become due, on the said shares andb) That the resolution making the call is duly recorded in the minutes books.
FORFEITURE AND SURRENDER OF AND LIEN ON SHARESIf money payable on share not paid then notice is to be given to Members.If any Member fails to pay any call or installment of call on or before the day appointed for the payment of the same or any such extension thereof as aforesaid, the Board may, at any time thereafter, during such time as the call or installment remains unpaid, give notice to him requiring him to pay the same together with any interest that may have accrued and all expenses that may have been incurred by the Company by reason of such non-payment.
Terms of noticeThe notice shall name a day (not being earlier than the expiry of fourteen days from the date of service of notice) and a place or places on and at which such call or installment and such interest thereon at such rate as the Directors shall determine from the day on which such call or installment ought to have been paid and expenses as aforesaid are to
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be paid. The notice shall also state that, in the event of the non-payment at or before the time and the place appointed, the share in respect of which the call was made or installment is payable will be liable to be forfeited.
Notice of forfeitureWhen any share shall have been so forfeited, notice of the forfeiture shall be given to the Member in whose name it stood immediately prior to the forfeiture or to any of his legal representatives, or to any of the persons entitled to the shares by transmission and an entry of the forfeiture, with the date thereof, shall forthwith be made in the Register of Members but no forfeiture, shall be in any manner invalidated by any omission or neglect to give such notice or to make such entry as aforesaid. Forfeited shares to become property of the Company and may be sold, etc. Any share so forfeited shall be deemed to be the property of the Company and may be sold, re-allotted or otherwise disposed of, either to the original holder thereof or to any other person, upon such terms and in such manner as the Board shall think fit.
Members still liable to pay money due notwithstanding the forfeitureAny member whose shares have been forfeited shall, notwithstanding the forfeiture, be liable to pay, and shall forthwith pay to the Company on demand all calls, amounts, installments, interest and expenses owing upon or in respect of such shares at the time of the forfeiture, together with interest thereon from the time of the forfeiture until payment, at such rate as the Board may determine and the Board may enforce the payment thereof if it thinks fit.
Effect of forfeitureThe forfeiture of a share shall involve extinction, at the time of the forfeiture, of all interest in and of all claims and demands against the Company, in respect of the share, and all other rights incidental to the share, except only such of those rights as by these Articles are expressly saved.
Surrender of sharesThe Directors may subject to the provisions of the Act, accept a surrender of any shares from or by any memberDesirous of surrendering them on such terms as they think fit.
Cancellation of share certificate in respect of forfeited sharesUpon any sale, re-allotment or other disposal under the provisions of the preceding Articles, the certificate or certificates originally issued in respect of the relative shares shall (unless the same shall on demand by the Company have been previously surrendered to it by the defaulting Member) stand cancelled and become null and void and of no effect, and the Directors shall be entitled to issue a new certificate or certificates in respect of the said shares to the person or persons entitled thereto.
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TRANSFER AND TRANSMISSION OF SHARES
Register of Transfers“The company shall keep a Register of Transfers and shall have recorded therein fairly and distinctly particulars of every transfer or transmission of any share held in material form”.
Form of transferShares in the Company shall be transferred by an instrument in writing in such form as prescribed under Section 108 of the Companies Act, 1956, or under rules made there under from time to time.
To be executed by Transferor and TransfereeThe instrument of transfer duly stamped and executed by the transferor and the transferee shall be delivered to the Company in accordance with the provisions of the Act. The instrument of transfer shall be accompanied by such evidence as the Board may require proving the title of the transferor and his right to transfer the shares and every registered instrument of transfer shall remain in the custody of the Company until destroyed by an order of the Board. The transferor shall be deemed to be the holder of such shares until the name of the transferee shall have been entered in the Register of Members in respect thereof. Before the registration of a transfer, the certificate or certificates of the shares must be delivered to the Company. Title to shares of deceased MemberThe executors or administrators or holders of a Succession Certificate or the legal representatives of a deceased member shall be the only person recognized by the Company as having any title to the shares registered in the name of such Member, and the Company shall not be bound to recognize such executors or administrators or holders of a Succession Certificate or the legal representatives unless such executors or administrators or legal representatives shall have first obtained Probate or Letter of Administration or Succession Certificate, as the case may be, from a duly constituted court in the Union of India provided that in case where the Board in its absolute discretion think fit, the Board may dispense with production of Probate or Letters of Administration or Succession Certificate, upon such terms as to indemnity or otherwise as the Board in its absolute discretion may think necessary and under Article 59 register the name of any person who claims to be absolutely entitled to shares standing in the name of a deceased Member, as a Member.
BORROWING POWERS
Power to BorrowSubject to the provisions of Sections 58A, 292 and 293 of the Act and of these Articles, the Board may, from time to time at its discretion, by a resolution passed at a Meeting of the Board accept deposits from Members, either in advance of call or otherwise, and generally raise or borrow or secure the payment of any sum or sums of money for the
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purposes of the company provided however, where the moneys to be borrowed together with the moneys already borrowed exceed the aggregate of the paid up capital of the Company and its free reserves the Board shall not borrow such moneys without the consent of the Company in General Meeting.
The payment or repayment of borrowed moneyThe payment or repayment of moneys borrowed as aforesaid may be secured in such manner and upon such terms and conditions in all respects as the Board may think fit.
Terms of issue of debenturesAny debentures, debenture-stock or other securities may be issued at a discount, premium or otherwise and maybe issued on condition that they or any part of them shall be convertible into shares of any denomination, and with any privileges and conditions as to redemption, surrender, drawing, allotment of shares and attending General Meetings, appointment of Directors and otherwise. Debentures with a right to conversion or allotment of shares shall be issued only with the consent of the Company in General Meeting.
SHARE WARRANT
Power to issue share warrants The Company may issue share warrants subject to, and in accordance with the provisions of sections 114 and 115, and accordingly the Board may in its discretion, with respect to any share which is fully paid-up on application in writing signed by the persons registered as holder of the share, and authenticated, by such evidence (if any) as the Board may, from time to time, require as to the identity of the person signing the application, and on receiving the certificate (if any) of the share, and the amount of the stamp duty on the warrant and such fee as the Board may from time to time require, issue a share warrant.
Deposit of share warrant The bearer of a share warrant may at any time deposit the warrant at the office of the Company, and so long as name were inserted in the Register of Members as the holder of the share included in the deposited the warrant remains so deposited, the depositor shall have the same right of signing a requisition for calling a meeting of the Company, and of attending, and voting and exercising the other privileges of a Member at any meeting held after the expiry of two clear days from the time of deposit as if his warrant. The bearer of a share warrant shall be entitled in all other respects to the same privileges and advantages as if he was named in the Register of Members as the holder of the share included in the warrant, and shall be a Member of the Company.
Issue of new Share Warrant or Coupon
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The Board may, from time to time, make rules as to the terms on which (if it shall think fit) a new share warrant or coupon may be issued by way of renewal in case of defacement, loss or destruction.
CONVERSION OF SHARE INTO STOCK AND RECONVERSION
Shares may be converted into stockThe Company in General Meeting may convert any paid-up shares into stock; and when any shares have been converted into stock, the several holders of such stock may thenceforth transfer their respective interest therein, or any part of such interest, in the said manner and subject to the same Regulations as, and subject to which shares from which the stock arose might have been transferred if no such conversion had taken place, or as near thereto as circumstance will admit. The Company may at any time reconvert any stock into paid-up shares of any denomination.
Right of stockholdersThe holders of stock shall, according to the amount of stock held by them, have the same rights, privileges and advantages as regards dividends, voting at meetings of the Company, and other matters, as if they held the shares from which the stock arose, but no such privilege advantage (except participation in the dividends and profits of the Company and in the assets on winding-up) shall be conferred by an amount of stock which would not, if existing in shares, have conferred that privilege or advantage.
MEMBERS’ MEETINGS
Annual General MeetingAnnual General Meeting of the company may be convened subject to Section 166 and Section 210 of the Act by giving not less than 21 days notice in writing. Subject to the provisions of Section 171 (2) a meeting may be convened after giving a shorter notice.
Extra ordinary General MeetingThe Board may, whenever it thinks fit, call an Extraordinary General Meeting and it shall do so upon a requisition in writing by any Member or Members holding in the aggregate not less than one tenth of such of the paid-up capital; as at that date carried the right of voting in regard to the matter in respect of which the requisition has been made.
Quorum at General Meeting: Five members present in person shall be a quorum for a General Meeting. A body corporate being a member shall be deemed to be personally present if it is represented in accordance with Section 187 of the Act. If, at the expiration of half an hour from the time appointed for holding a meeting of the Company, a quorum shall not be present, the meeting it convened by or upon the requisition of Members, shall stand dissolved, but in any other case the meeting shall stand adjourned to the same day
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in the next week or if that day is a public holiday until the next succeeding day which is not a public holiday at the same time and place or to such other day at such other time and place within the city or town in which the Office of the Company is situate as the Board may determine, and if at such adjourned meeting a quorum is not present at the expiration of half an hour from the time appointed for holding the meeting, the Members present shall be a quorum, and may transact, the business for which the meeting was called. The Chairman (if any) of the Directors shall be entitled to take the chair at every General Meeting, whether Annual or Extraordinary. If there be no such Chairman of the Directors, or if at any meeting he shall not be present within fifteen minutes of the time appointed for holding such meeting then the members present shall elect another Director as Chairman and if no Director be present or if all Directors present decline to take the Chair, then the members present shall elect one of their members to be the Chairman.
Question at General Meeting how decided At any General Meeting a resolution put to the vote of the meeting shall be decided on a show of hands unless a poll is (before or on the declaration of the result of the show of hands) demanded by a member or members present in person or by proxy and holding shares in the Company
Number of votes to which member entitledSubject to the provisions of these Articles and without prejudice to any special privileges or restrictions as to voting for the time being attached to any class of shares for the time being forming part of the capital of the Company, every member, not disqualified by the last preceding Article shall be entitled to be present and to speak and vote at such meeting, and on a show of hands every member present in person shall have one vote and upon a poll the voting rights of every member whether present in person or by proxy, shall be in proportion to his share of the paid-up equity capital of the Company.
DIRECTORSNumber of DirectorsUntil otherwise determined by the company in a General Meeting and subject to the provisions of Section 252 of the Act, the number of directors (excluding Debenture Directors and Directors appointed under Article 111 hereof and Alternate Directors) shall not be less than three nor more than Eighteen. The Board may appoint, from time to time, one or more of their members to be the Managing Director or Joint Managing Director or Whole time Director or Deputy Managing Director or Manager of the Company on such terms and on such remuneration whether by way of salary or commission, or partly in one and partly in another as they may think fit
Appointment of special Directors
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On behalf of the Company, whenever Directors enter into a contract with any Government, Central, State or Local, any Bank or Financial institution or any person or persons (hereinafter referred to as “the appointer”) for borrowing any money or for providing any guarantee or security or for technical collaboration or assistance or for underwriting or entering into any other arrangement whatsoever the Directors shall have, subject to the provisions of Section 255 of the Act, the power to agree that such appointer shall have right to appoint or nominate by notice in writing addressed to the Company one or more Directors on the Board for such period and upon such conditions as may be mentioned in the agreement and that such Director or Directors may not be liable to retire by rotation nor be required to hold any qualification shares. The Directors may also agree that any such Director or Directors may be removed from time to time by the appointer entitled to appoint or nominate them and the appointer may appoint another or others in his or their place and also fill in any vacancy which may occur as a result of any such Director or Directors ceasing to hold that office for any reason whatsoever. The Directors appointed or nominated under this Article shall be entitled to exercise and enjoy all or any of the rights and privileges exercised and enjoyed by the Directors of the Company including payment of remuneration and travelling expenses to such Director or Directors as may be agreed by the Company with the appointer.
Removal of Directors:The Company may (subject to the provisions of Section 284 of the Act) remove any Director before the expiration of his period of office and appoint another person in his stead.
PROCEEDINGS OF THE BOARD OF DIRECTORS
Meeting of DirectorsThe Directors may meet together as a Board for the dispatch of business from time to time and shall so meet at least once in every three calendar months and at least four such meetings shall be held in every year. The Directors may adjourn and otherwise regulate their meetings as they may think fit.
Notice of Board Meetings Notice of every meeting of the Board shall be given in writing to every Director for the time being in India and at his address in India to every other Director.
QuorumSubject to Section 287 of the Act, the quorum for a meeting of the Board shall be one-third of its total strength (excluding Directors, if any, whose places may be vacant at the time. and any fraction contained in that one-third being rounded off as one), or two Directors whichever is higher. Provided that where at any time the number of interested Directors exceeds or is equal to two- thirds of the total strength, the number of the
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remaining Directors, that is to say, the number of the Directors who are not interested present at the meeting being not less than two, shall be the quorum during such meeting.
Division of profitsThe profits of the Company, subject to any special rights relating thereto created or authorized to be created by these Articles, shall be divisible among the Members in proportion to the amount of capital paid-up or credited as paid-up and to the period during the year for which the capital is paid-up on the shares held by them respectively.
The Company in general meeting may declare dividendsSubject to the provisions of Section 205 of the Companies Act, 1956 the Company in General Meeting may declare dividends, to be paid to its Members according to their respective rights but no dividends shall exceed the amount recommended by the Board, but the Company in General Meeting may declare a smaller dividend.
Interim DividendThe Board may, from time to time, pay to the members such interim dividend as in their judgment the position of the Company justifies.
Capital paid-up in advance carrying interest not to earn dividendWhere capital is paid in advance of calls, such capital may carry interest but shall not be in respect thereof confer a right to dividend or participate in profits.
Dividend to be paid pro-rataSubject to the rights of persons, if any, entitled to shares with special rights as to dividends, all dividends shall be declared and paid according to the amounts paid or credited as paid on the shares in respect whereof dividend is paid.
Retention of Dividends until completion of transfer under Article 62The Board may retain the dividends payable upon shares in respect of which any person is, under Article 62 entitled to become a Member, which any person under that Article is entitled to transfer, until such person shall become a member in respect of such shares or shall duly transfer the same.
Board ReportThere shall be attached to every such balance sheet a report of the Board as to the state of the Company’s affairs and as to the amounts, if any, which it proposes to carry to any reserves in such balance sheet and the amount, if any, which it recommends should be paid by way of dividend; and material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the
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financial year of the company to which the balance sheet relates and the date of the report. The Board’s report shall so far as is material for the appreciation of the state of the Company’s affairs by its members and will not in the Board’s opinion be harmful to the business of the company or any of its subsidiaries, deal with any changes which have occurred during the financial year in the nature of the Company’s business, in the Company’s subsidiaries or in the nature of the business carried on by them and generally in the classes of business in which the company has an interest and any other information as may be required by Section 217 of the Act. The Board shall also give the fullest information and explanations in its report aforesaid or in an addendum to that report, on every reservation, qualification or adverse remark contained in the auditor’s report. The Board’s report and any addendum thereto shall be signed by its Chairman if he is authorized in that behalf by the Board; and when he is not so authorized, shall be signed by not less than two Directors.
WINDING UP
Distribution of AssetsThe Liquidator on any winding up (whether voluntary and supervision or compulsory) may with the sanction of a Special Resolution, but subject to the rights attached to any preference share capital, divide among the contributories in specie any part of the assets of the Company and may, with the like sanction, vest any part of the assets of the Company in trustees upon such trusts for the benefit of the contributors, as the liquidator, with the like sanction shall think fit.
Registration with the Registrar of Companies to get the TEXTILE MILL incorporated
1. SELECTION OF A NAME:We have to select, in order of preference, at least one suitable name up to a
maximum of six names, indicative of the main objects of the company. The following are the names which we want to name our Textile Mill:
i. JRD Textile Mills Limited.ii. National Textile Mills Limited.
We have ensured that the name does not resemble the name of any other already registered textile mill and also does not violate the provisions of emblems and names (Prevention of Improper Use Act, 1950) by availing the services of checking name availability on the portal.
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2. APPLICATION OF THE NAME:
We have to apply to the concerned RoC to ascertain the availability of name in eForm1 A [Pursuant to sections 20 and 21 of the Companies Act, 1956] by logging in to the portal. A fee of Rs. 500/- has to be paid alongside and the digital signature of the applicant proposing the company has to be attached in the form. If proposed name is not available, the user has to apply for a fresh name on the same application. Form 1A is attached and filled
3. GRANTING OF THE NAME BY THE R.O.C.:
The first name, i.e. JRD TEXTILE MILLS Limited is assumed to have been selected and the letter of incorporation has been received.
4. FILLING OF THE FORM TO GET THE COMPANY REGISTERED:
The form is filled giving the following information:
A. The application is for incorporating of a new Textile Mill Limited, JRD Textile Mill Ltd.
B. The proposed company is a Public company.C. The Category of the Proposed Company is a company limited by
shares.D. The company is having Share Capital.E. The state will be registered in the state of Punjab.F. The numbers of promoters are 7.G. The main object of the company is manufacturing clothesH. Proposed authorized capital is Rs 120000,000 (Twelve Crore Only)
Along with the form we have to arrange for the drafting of the memorandum and articles of association by the solicitors, vetting of the same by RoC and printing of the same. The memorandum and article must be arranged for stamping of the memorandum and articles with the appropriate stamp duty.
We have to get the Memorandum and the Articles signed by at least two subscribers in own hand, father's name, occupation, address and the number of shares subscribed for and witnessed by at least one person.
We have to ensure that the Memorandum and Article is dated on a date after the date of stamping.
Login to the portal and fill the following forms and attach the mandatory documents listed in the eForm
Declaration of compliance - Form-1Notice of situation of registered office of the company - Form-18. Particulars of the Director's, Manager or Secretary - Form-32.
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We have to submit the following eForms after attaching the digital signature pay the requisite filing and registration fees and send the physical copy of Memorandum and Article of Association to the RoC
After processing of the Form is complete and Corporate Identity is generated obtain Certificate of Incorporation from RoC.
ADDITIONAL STEPS TO BE TAKEN FOR FORMATION OF A PUBLIC LIMITED COMPANY:
To obtain Commencement of Business Certificate after incorporation of the company the public company has to make following compliance
File a declaration in eForm 20 and attach the statement in lieu of the prospectus(schedule III) OR
File a declaration in eForm 19 and attach the prospectus (Schedule II) to it. Obtain the Certificate of Commencement of Business.
REGISTRAR OF COMPANIES
CERTIFICATE OF COMMENCEMENT OF BUSINESS
This is to certify that The JRD Textile Mill Limited filed for incorporation was granted on the 30th November 2009. This proved that the company has performed all the requirements and fulfilled the legal procedures of the incorporation of the company and all the documents were found legal and satisfactory. From this day it is forwarded that the company is capable of undertaking its normal business operation.
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PROSPECTUS
In order to finance its activities , a company needs capital which is raised by a public company by issue of a prospectus. To raise the capital “GSP TRANSPORTATION” company issue the prospectus and invite general public to buy the shares of the company.
They also send a copy of prospectus to registrar for the registration of the prospectus because without this a company cannot issue the prospectus.
The important contents of prospectus are as follow:-1 General information about the company2 Capital structure of the company3 Terms of the present issue4 Company, management and project5 Management perceptions to risk factors
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6 Financial information7 Statutory and other information
CONTRACT
This is to certify that JRD Textile Ltd. has undergone contract with SDP Pvt. Ltd. as an distributors to retail their product at Jalandhar and Phagwara. The sum of Rs 2000000 (Rupees Twenty lacs) has been paid for the purpose of retailing the products.
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Jinu Jose Dhananjay Kumar
Managing Director Managing Director
JRD Textile Mills Ltd. SDP Pvt. Ltd
FORM NO. 1
Registration No. of Company .......... Nominal Capital : Rs. ................
THE COMPANIES ACT, 1956
Declaration of compliance with the requirements of the Companies Act, 1956 on application for registration of a company
[Pursuant to section 33(2)]
Name of Company JRD Textile Mills Limited/Private Limited
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Presented by ..Jinu, Jose, Dhananjay Kumar and Rajiv Gupta
we promoters ., of JRD Textile Mills do solemnly and sincerely
Declare that I am [1] Rajiv Gupat who is engaged in the formation of the company, or a person
Named in the articles as a director/manager/secretary of the Limited/Private
Limited.
And that all the requirements of the Companies Act, 1956, and the rules thereunder in respect of matters precedent to the registration of the said company and incidental thereto have been complied with.
And make this solemn declaration conscientiously believing the same to be true.
Date 04/12/09
Place Jalandhar Signature
Witness
Designation
FORM NO. 18
Registration No. of the Company Nominal Capital: Rs
THE COMPANIES ACT, 1956
Notice of the situation/change of situation of registered office
[pursuant to section 146]
Name of the company: JRD Textile Mills Ltd.
Notice is hereby given that ----
1. (a) the registered office of the company is situated Phagwara, Jalandhar .with effect from 04/12/09 [date]
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(b) the situation of the registered office of the company of was changed from to with effect form .
[date]
2. Situation of registered office falls under the jurisdiction of (name of the police station).* Dated this Day of 19
Signature
Name
(In Block Capitals)
Designation
*State address of nearest police station with district and tehsil.
1. An advocate of the Supreme Court of the ...................... High Court, an attorney or a pleader entitled to appear before the ........................... High Court or a chartered accountant practising in India.
2. State whether director, manager / secretary /advocate/ chartered account.
FORM NO 29
Registration No. of Company ........................ Nominal Capital Rs. ...................................
THE COMPANIES ACT, 1956
Consent to act as director of a company and/or undertaking to take and pay for qualification shares
[pursuant to section 264(2)/266(I)(a) and 266(1)(b)(iii)]
Name of company .............................................. Limited ..........................................
Presented by ..................................................................................................................
To the Registrar of Companies .......................................................................
I, the undersigned, hereby testify my consent to act as director of the .......................... limited, ................................ pursuant to section 264(2)/266(1)(a) of the Companies Act, 1956 and
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certify that I have not been disqualified to act as a director under sections 267 and/or 274 of the Companies Act, 1956.
I, the undersigned having consented to act as director of the .............................. Limited, also hereby undertake to take from the said company and pay for .................... shares of Rs. ................. each, being the number/value of the shares prescribed as the qualification shares for the office of director of the said company.
Name and surname in full
and father’s names
Address Occupation Date of birth Nationality Signature
1 2 3 4 5 6
Signature ..............................
Designation ...........................
Dated the ........................... day of .................... 19
Notes: (1) Delete the portion not applicable.
(2) If a director signs through his agent authorised in writing, the authority must be produced before the Registrar.
(3) In case of undertaking to take and pay for qualification shares, the from should be accompanied by the necessary stamp duty.
FORM NO. 32
Registration No. of Company .......................... Nominal Capital Rs. ...................................
THE COMPANIES ACT, 1956
Particulars of appointment of directors and manager and changes among them
[Pursuant to section 303(2)]
Name of Company ......................................... Presented by ...............................................
Note : --- If a company has no particulars to be included in one or two of the headings ‘A’ ‘B’ and ‘C’ the parts containing those headings (in respect of which the company has no particulars to be included) need not be filed.
A. Appointment of and changes among directors.
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Name or names and surname in full
Father’s/ husband’s name
Usual residential address
Nationality Date of appointment or change
Brief particulars of changes
1 2 3 4 5 6
Notes: (1) A note of changes should be made in column 6 e.g. by inserting against the name of new director, etc. the words “in place of ........................ and by indicating against the name of the former director, the cause for the change, e.g. by death, resignation, retirement by rotation, disqualification etc. (2) In case of managing director, his designation should be stated with his name in columan1.
B. [***]
C. Appointment of and changes in managership and secretaryship.
Name or names and surname in full
Father’s/ husband’s name
Usual residential address
Nationality Date of appointment or change
Brief particulars of changes
1 2 3 4 5 6
Dated the .......................................... day of ..............19
Notes: (1) For the purposes of this form, particulars of a person appointed as manager within the meaning of section 2(24) of the Companies Act, 1956 need be given.
(2) A note of change as also the cause of change e,g, by death, resignation, removal, disqualification, etc. should be stated in column 6.
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