Apex Law Journal
Apex Law Journal
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Editor

Neha Goel, Advocate

Advisory Board

S.C. Khunger, Advocate

Rohit Bansal, Advocate

Varinder Singh Kanwar, Advocate

Hittan Nehra, Advocate

Judgments on Companies Act, 1956

Tuesday, February 21, 2012
Companies Act, 1956

Companies Act, 1956 — Section 391 — The effect of approval of a scheme of compromise and arrangement under Section 391 of the Companies Act is that it binds the dissenting minority, the company as also the liquidator if the company is under winding up — Therefore, Section 391 of the Companies Act gives very wide discretion to the Court to approve any set of arrangement between the company and its shareholders.

 
Companies Act, 1956

Companies Act, 1956 — Section 391 — A scheme under Section 391 of the Companies Act does not have the effect of creating new debt — The scheme simply makes the original debt payable in a manner and to the extent provided for in the scheme — In the instant appeal in most of the cases the offence under the N.I. Act has been committed prior to the scheme — Therefore, the offence which has already been committed prior to the scheme does not get automatically compounded only as a result of the said scheme.

 
Companies Act, 1956

Companies Act, 1956 — Section 391 — The scheme under Section 391 of the Companies Act, 1956, held,  must be fair, just and reasonable and should not contravene public policy or any statutory provision.

 
Companies Act, 1956

Companies Act, 1956 — Section 391 — Compounding of an offence cannot be achieved indirectly by the sanctioning of a scheme by the Company Court u/s 391 of the Companies Act, 1956 — Companies Act, 1956, Section 391 — Negotiable Instruments Act, 1881, Sections 138, 141 and 147 — Criminal Procedure Code, 1973, Section 320.

 
Wednesday, December 14, 2011
Companies Act, 1956

Companies Act, 1956 — Section 529A — Employees Provident Funds and Miscellaneous Provisions Act, 1952, Section 11(2) — The mere ranking of the dues of workers at par with debts due to secured creditors cannot lead to an inference that Parliament intended to create first charge in favour of the secured creditors and give priority to the debts due to secured creditors over the amount due from the employer under the EPF Act.

 
Companies Act, 1956

Companies Act, 1956 — Section 529A — First charge in respect of the workmen’s dues — Held, there is nothing in the language of Section 529A which may give an indication that legislature wanted to create first charge in respect of the workmen’s dues, as defined in Sections 529(3)(b) and 529A and debts due to the secured creditors.  

 
Companies Act, 1956

Companies Act, 1956 — Section 529A(1) — Employees Provident Funds and Miscellaneous Provisions Act, 1952, Section 11(2) — Contention that the non obstante clause contained in the subsequent legislation, i.e. Section 529A(1) of the Companies Act should prevail over similar clause contained in an earlier legislation, i.e. Section 11(2) of the EPF Act, held, not tenable.

 
Companies Act, 1956

Companies Act, 1956 — Section 529A(1) — Companies (Amendment) Act No. 35 of 1985 — By virtue of the non obstante clause contained in sub-section (1) of Section 529A, statutory priority has been given to the workmen’s dues and debts due to secured creditors over all other dues.

 
Companies Act, 1956

Companies Act, 1956 — Section 529(3)(b) — Companies (Amendment) Act No. 35 of 1985 — Expression “workmen’s dues” — Meaning of — Held, the expression “workmen’s dues” has been defined in Section 529(3)(b) to mean all wages or salary including wages payable for time or piece work and salary earned wholly or in part by way of commission of any workman in respect of services rendered to the company and any compensation payable to any workman under the Industrial Disputes Act, 1947, all accrued holiday remuneration payable to any workman, or in the case of his death to any other person in his right upon the termination of his employment before the passing of winding up order and all sums due to any workman from a provident fund, a pension fund, a gratuity fund or any other fund for the welfare of the workmen, which is maintained by the company — The definition also takes within its fold funds capable of being transferred to and vested in the workman under a contract with insurers under Section 14 of the Workmen’s Compensation Act as also the amounts due in respect of any compensation or liability for compensation under the Workmen’s Compensation Act in respect of the death or disablement of any workman of the company.

 
Companies Act, 1956

Companies Act, 1956 — Section 529(3)(a) — Companies (Amendment) Act No. 35 of 1985 — Term ‘workmen’ — With the insertion of Section 529(3)(a), the definition of the term ‘workmen’ contained in the Industrial Disputes Act, 1947 has been incorporated in the Companies Act for the purposes of Sections 529, 529A and 530.

 
Companies Act, 1956

Companies Act, 1956 — Section 529(1), Proviso — Companies (Amendment) Act No. 35 of 1985 — By inserting proviso in Section 529(1), Parliament ensured protection of the interest of the workmen in winding up proceedings — The object of this amendment is to place the legitimate dues of workers at par with those of secured creditors.

 
Tuesday, December 06, 2011
Companies Act, 1956

Companies Act, 1956 — Section 159 — There is a statutory requirement under Section 159 of the Companies Act that every Company having a share capital shall have to file with the Registrar of Companies an annual return which include details of the existing Directors.

 
Companies Act, 1956

Companies Act, 1956 — Sections 159, 163 and 610(3) — Certified copy of annual return is a public document — Evidence Act, 1872, Section 74(2).

 
Wednesday, August 12, 2009
Companies Act, 1956

Companies Act, 1956 — Section 5, 291 and Clauses (24), (26), (30), (31), (45) of Section 2 — A combined reading of Sections 5 and 291 of Companies Act, 1956 with the definitions in clauses (24), (26), (30), (31), (45) of section 2 of that Act would show that the following persons are considered to be the persons who are responsible to the company for the conduct of the business of the company : —

(a) the managing director/s;

(b) the whole-time director/s;

(c) the manager;

(d) the secretary;

(e) any person in accordance with whose directions or instructions the Board of directors of the company is accustomed to act;

(f) any person charged by the Board with the responsibility of complying with that provision (and who has given his consent in that behalf to the Board); and

(g) where any company does not have any of the officers specified in clauses (a) to (c), any director or directors who may be specified by the Board in this behalf or where no director is so specified, all the directors.

  It follows that other employees of the company, cannot be said to be persons who are responsible to the company, for the conduct of the business of the company — Negotiable Instruments Act, 1881, Section 141.

 
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