The history of the Indian Company Law started with the Joint Stock Companies Act,1850. Thereafter, a process that is cumulative of amendment and consolidation brought us to the comprehensive and complicated piece of legislation, the Companies Act, 1956. The Companies Act, 2013 has replaced the Companies Act, 1956 to date. The Act that is brand new has 470 sections and 7 schedules as compared to the 658 sections and 15 schedules of the 1956 Act. An organization is just a “corporation” – an individual that is synthetic by law. A being that is human being a “natural” person. An organization is just a “legal” individual. A company therefore has rights and obligations in the manner that is exact same a natural person does.
Company law (also referred to as company legislation or enterprise law or often ongoing Company law) may be seen as the human anatomy of law regulating the legal rights, relations, and conduct of persons, Companies, organizations and businesses. The Central Government has notified the constitution of National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT) on 1st June, 2016 the phrase ‘Company’ is an amalgamation for the Latin term ‘Com’ meaning “with or together” and ‘Pains’ meaning “bread”. Initially, it known a mixed band of individuals who took their dishes together. A Company is nothing but a number of people who have get together or that have contributed cash for some person that is typical who possess incorporated themselves right into a distinct legal entity in the form of a company for that function. On incorporation under legislation, a company turns into a distinct legal entity as compared to its members. The company is distinct and different from its people in law. It has its own title and own seal, its assets and liabilities are separate and distinct from those of its members. It’s with the capacity of owning property, incurring debt, borrowing cash, having a bank account, hiring people, stepping into agreements and suing and being sued separately. The obligation associated with the known users associated with company is limited to share to their assets regarding the company up to the face value of shares held by him. An associate is liable to cover only the amount that is uncalled on stocks held by him when contacted to pay and absolutely nothing more, even if liabilities of this business far surpasses its assets. The creditors can force the partners to make good the deficit from their individual assets on the other hand, partners of a partnership firm have unlimited liability in other words if the assets of the company are not adequate to cover the liabilities for the firm. This may not be done in case of a company once the members have compensated each of their dues towards the stocks held by them in the company.
A company will not die or vanish unless its specifically wound up or the duty for which it had been created happens to be completed. Membership of a running company may carry on changing from time to time but that will not impact life of this company. Insolvency or death of member will not affect the presence of the company. A Company is just a distinct entity that is legal. The company’s property is its own. A company is an artificial person and won’t have an existence that is physical. Therefore, it acts through its Board of Directors to carry out its activities and entering into various agreements. Such agreements must be beneath the seal regarding the company. These contracts/agreements must under the seal of the company. The seal is the signature of the company. The title associated with business must be etched regarding the seal that is typical. Any document not bearing the seal of this company may possibly not be accepted as authentic and could not have any force that is legal. An organization can sue or be sued in its name that is separate from the members.
Frequently Asked Questions (FAQs) about Company law in India:
- What is Company law? Company law is a set of laws and regulations that govern the formation, management, and dissolution of companies in India.
- What are the types of companies that can be formed in India? In India, there are several types of companies that can be formed, including private limited companies, public limited companies, one person companies, and limited liability partnerships.
- What is the process for forming a company in India? To form a company in India, the following steps must be taken: a. Obtain a Director Identification Number (DIN) b. Obtain a Digital Signature Certificate (DSC) c. Reserve a name for the company d. File the incorporation documents with the Registrar of Companies (ROC)
- What are the legal requirements for directors of a company? Directors of a company must comply with several legal requirements, such as filing annual returns, maintaining proper books of accounts, and avoiding conflicts of interest.
- What is the role of a company secretary in a company? A company secretary is responsible for ensuring that the company complies with all legal and regulatory requirements, and also assists the board of directors in making informed decisions.
- What are the penalties for non-compliance with Company law? Non-compliance with Company law can result in fines, penalties, and legal action. In severe cases, the company may be dissolved.
- What is Corporate Social Responsibility (CSR) under Company law? Under Company law, companies are required to allocate a portion of their profits towards CSR activities that benefit society at large.
- What are the legal requirements for winding up a company in India? To wind up a company in India, certain legal requirements must be met, such as obtaining approval from shareholders, filing the necessary paperwork with the ROC, and settling outstanding debts.
At Century Law Firm, our experienced lawyers are well-versed in all aspects of Company law in India. We provide a wide range of legal services to our clients, including assistance with company formation, compliance, dispute resolution and all kinds of litigations. Our lawyers have a deep understanding of the legal requirements and regulations governing companies in India, and are committed to providing high-quality legal advice and representation to our clients.