THE COMPANIES ACT, 2013

ACT NO. 18 OF 2013 · Enacted [29th August, 2013.] · 477 sections

PRELIMINARY

Section 1.Short title, extent, commencement and application.

Section 2.Definitions.

INCORPORATION OF COMPANY AND MATTERS INCIDENTAL THERETO

Section 3.Formation of company.

Section 3A.Members severally liable in certain cases.

Section 4.Memorandum.

Section 5.Articles.

Section 6.Act to override memorandum, articles, etc.

Section 7.Incorporation of company.

Section 8.Formation of companies with charitable objects, etc.

Section 9.Effect of registration.

Section 10.Effect of memorandum and articles.

Section 10A.Commencement of business, etc.

Section 11.[Omitted.].

Section 12.Registered office of company.

Section 13.Alteration of memorandum.

Section 14.Alteration of articles.

Section 15.Alteration of memorandum or articles to be noted in every copy.

Section 16.Rectification of name of company.

Section 17.Copies of memorandum, articles, etc., to be given to members.

Section 18.Conversion of companies already registered.

Section 19.Subsidiary company not to hold shares in its holding company.

Section 20.Service of documents.

Section 21.Authentication of documents, proceedings and contracts.

Section 22.Execution of bills of exchange, etc.

PROSPECTUS AND ALLOTMENT OF SECURITIES — PART I.—Public offer

Section 23.Public offer and private placement.

Section 24.Power of Securities and Exchange Board to regulate issue and transfer of securities, etc.

Section 25.Document containing offer of securities for sale to be deemed prospectus.

Section 26.Matters to be stated in prospectus.

Section 27.Variation in terms of contract or objects in prospectus.

Section 28.Offer of sale of shares by certain members of company.

Section 29.Public offer of securities to be in dematerialised form.

Section 30.Advertisement of prospectus.

Section 31.Shelf prospectus.

Section 32.Red herring prospectus.

Section 33.Issue of application forms for securities.

Section 34.Criminal liability for mis-statements in prospectus.

Section 35.Civil liability for mis-statements in prospectus.

Section 36.Punishment for fraudulently inducing persons to invest money.

Section 37.Action by affected persons.

Section 38.Punishment for personation for acquisition, etc., of securities.

Section 39.Allotment of securities by company.

Section 40.Securities to be dealt with in stock exchanges.

Section 41.Global depository receipt.

PROSPECTUS AND ALLOTMENT OF SECURITIES — PART II.—Private placement

Section 42.Issue of shares on private placement basis.

SHARE CAPITAL AND DEBENTURES

Section 43.Kinds of share capital.

Section 44.Nature of shares or debentures.

Section 45.Numbering of shares.

Section 46.Certificate of shares.

Section 47.Voting rights.

Section 48.Variation of shareholders‘ rights.

Section 49.Calls on shares of same class to be made on uniform basis.

Section 50.Company to accept unpaid share capital, although not called up.

Section 51.Payment of dividend in proportion to amount paid-up.

Section 52.Application of premiums received on issue of shares.

Section 53.Prohibition on issue of shares at discount.

Section 54.Issues of sweat equity shares.

Section 55.Issue and redemption of preference shares.

Section 56.Transfer and transmission of securities.

Section 57.Punishment for personation of shareholder.

Section 58.Refusal of registration and appeal against refusal.

Section 59.Rectification of register of members.

Section 60.Publication of authorised, subscribed and paid-up capital.

Section 61.Power of limited company to alter its share capital.

Section 62.Further issue of share capital.

Section 63.Issue of bonus shares.

Section 64.Notice to be given to Registrar for alteration of share capital.

Section 65.Unlimited company to provide for reserve share capital on conversion into limited company.

Section 66.Reduction of share capital.

Section 67.Restrictions on purchase by company or giving of loans by it for purchase of its shares.

Section 68.Power of company to purchase its own securities.

Section 69.Transfer of certain sums to capital redemption reserve account.

Section 70.Prohibition for buy-back in certain circumstances.

Section 71.Debentures.

Section 72.Power to nominate.

ACCEPTANCE OF DEPOSITS BY COMPANIES

Section 73.Prohibition on acceptance of deposits from public.

Section 74.Repayment of deposits, etc., accepted before commencement of this Act.

Section 75.Damages for fraud.

Section 76.Acceptance of deposits from public by certain companies.

Section 76A.Punishment for contravention of section 73 or section 76.

REGISTRATION OF CHARGES

Section 77.Duty to register charges, etc.

Section 78.Application for registration of charge.

Section 79.Section 77 to apply in certain matters.

Section 80.Date of notice of charge.

Section 81.Register of charges to be kept by Registrar.

Section 82.Company to report satisfaction of charge.

Section 83.Power of Registrar to make entries of satisfaction and release in absence of intimation from company.

Section 84.Intimation of appointment of receiver or manager.

Section 85.Company‘s register of charges.

Section 86.Punishment for contravention.

Section 87.Rectification by Central Government in Register of charges.

MANAGEMENT AND ADMINISTRATION

Section 88.Register of members, etc.

Section 89.Declaration in respect of beneficial interest in any share.

Section 90.Register of significant beneficial owners in a Company.

Section 91.Power to close register of members or debenture holders or other security holders.

Section 92.Annual return.

Section 93.[Omitted.].

Section 94.Place of keeping and inspection of registers, returns, etc.

Section 95.Registers, etc., to be evidence.

Section 96.Annual general meeting.

Section 97.Power of Tribunal to call annual general meeting.

Section 98.Power of Tribunal to call meetings of members, etc.

Section 99.Punishment for default in complying with provisions of sections 96 to 98.

Section 100.Calling of extraordinary general meeting.

Section 101.Notice of meeting.

Section 102.Statement to be annexed to notice.

Section 103.Quorum for meetings.

Section 104.Chairman of meetings.

Section 105.Proxies.

Section 106.Restriction on voting rights.

Section 107.Voting by show of hands.

Section 108.Voting through electronic means.

Section 109.Demand for poll.

Section 110.Postal ballot.

Section 111.Circulation of members‘ resolution.

Section 112.Representation of President and Governors in meetings.

Section 113.Representation of corporations at meeting of companies and of creditors.

Section 114.Ordinary and special resolutions.

Section 115.Resolutions requiring special notice.

Section 116.Resolutions passed at adjourned meeting.

Section 117.Resolutions and agreements to be filed.

Section 118.Minutes of proceedings of general meeting, meeting of Board of Directors and other meeting and resolutions passed by postal ballot.

Section 119.Inspection of minute-books of general meeting.

Section 120.Maintenance and inspection of documents in electronic form.

Section 121.Report on annual general meeting.

Section 122.Applicability of this Chapter to One Person Company.

DECLARATION AND PAYMENT OF DIVIDEND

Section 123.Declaration of dividend.

Section 124.Unpaid Dividend Account.

Section 125.Investor Education and Protection Fund.

Section 126.Right to dividend, rights shares and bonus shares to be held in abeyance pending registration of transfer of shares.

Section 127.Punishment for failure to distribute dividends.

ACCOUNTS OF COMPANIES

Section 128.Books of account, etc., to be kept by company.

Section 129.Financial statement.

Section 130.Re-opening of accounts on court‘s or Tribunal‘s orders.

Section 131.Voluntary revision of financial statements or Board‘s report.

Section 132.Constitution of National Financial Reporting Authority.

Section 133.Central Government to prescribe accounting standards.

Section 134.Financial statement, Board‘s report, etc.

Section 135.Corporate Social Responsibility.

Section 136.Right of member to copies of audited financial statement.

Section 137.Copy of financial statement to be filed with Registrar.

Section 138.Internal Audit.

AUDIT AND AUDITORS

Section 139.Appointment of auditors.

Section 140.Removal, resignation of auditor and giving of special notice.

Section 141.Eligibility, qualifications and disqualifications of auditors.

Section 142.Remuneration of auditors.

Section 143.Powers and duties of auditors and auditing standards.

Section 144.Auditor not to render certain services.

Section 145.Auditor to sign audit reports, etc.

Section 146.Auditors to attend general meeting.

Section 147.Punishment for contravention.

Section 148.Central Government to specify audit of items of cost in respect of certain companies.

APPOINTMENT AND QUALIFICATIONS OF DIRECTORS

Section 149.Company to have Board of Directors.

Section 150.Manner of selection of independent directors and maintenance of data bank of independent directors.

Section 151.Appointment of director elected by small shareholders.

Section 152.Appointment of directors.

Section 153.Application for allotment of Director Identification Number.

Section 154.Allotment of Director Identification Number.

Section 155.Prohibition to obtain more than one Director Identification Number.

Section 156.Director to intimate Director Identification Number.

Section 157.Company to inform Director Identification Number to Registrar.

Section 158.Obligation to indicate Director Identification Number.

Section 159.Penalty for default of certain provisions.

Section 160.Right of persons other than retiring directors to stand for directorship.

Section 161.Appointment of additional director, alternate director and nominee director.

Section 162.Appointment of directors to be voted individually.

Section 163.Option to adopt principle of proportional representation for appointment of directors.

Section 164.Disqualifications for appointment of director.

Section 165.Number of directorships.

Section 166.Duties of directors.

Section 167.Vacation of office of director.

Section 168.Resignation of director.

Section 169.Removal of directors.

Section 170.Register of directors and key managerial personnel and their shareholding.

Section 171.Members‘ right to inspect.

Section 172.Punishment.

MEETINGS OF BOARD AND ITS POWERS

Section 173.Meetings of Board.

Section 174.Quorum for meetings of Board.

Section 175.Passing of resolution by circulation.

Section 176.Defects in appointment of directors not to invalidate actions taken.

Section 177.Audit committee.

Section 178.Nomination and Remuneration Committee and Stakeholders Relationship Committee.

Section 179.Powers of Board.

Section 180.Restrictions on powers of Board.

Section 181.Company to contribute to bona fide and charitable funds, etc.

Section 182.Prohibitions and restrictions regarding political contributions.

Section 183.Power of Board and other persons to make contributions to national defence fund, etc.

Section 184.Disclosure of interest by director.

Section 185.Loan to directors, etc.

Section 186.Loan and investment by company.

Section 187.Investments of company to be held in its own name.

Section 188.Related party transactions.

Section 189.Register of contracts or arrangements in which directors are interested.

Section 190.Contract of employment with managing or whole-time directors.

Section 191.Payment to director for loss of office, etc., in connection with transfer of undertaking, property or shares.

Section 192.Restriction on non-cash transactions involving directors.

Section 193.Contract by One Person Company.

Section 194.[Omitted.].

Section 195.[Omitted.].

APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL

Section 196.Appointment of managing director, whole-time director or manager.

Section 197.Overall maximum managerial remuneration and managerial remuneration in case of absence or inadequacy of profits.

Section 198.Calculation of profits.

Section 199.Recovery of remuneration in certain cases.

Section 200.Central Government or company to fix limit with regard to remuneration.

Section 201.Forms of, and procedure in relation to, certain applications.

Section 202.Compensation for loss of office of managing or whole-time director or manager.

Section 203.Appointment of key managerial personnel.

Section 204.Secretarial audit for bigger companies.

Section 205.Functions of company secretary.

INSPECTION, INQUIRY AND INVESTIGATION

Section 206.Power to call for information, inspect books and conduct inquiries.

Section 207.Conduct of inspection and inquiry.

Section 208.Report on inspection made.

Section 209.Search and seizure.

Section 210.Investigation into affairs of company.

Section 211.Establishment of Serious Fraud Investigation Office.

Section 212.Investigation into affairs of company by Serious Fraud Investigation Office.

Section 213.Investigation into company‘s affairs in other cases.

Section 214.Security for payment of costs and expenses of investigation.

Section 215.Firm, body corporate or association not to be appointed as inspector.

Section 216.Investigation of ownership of company.

Section 217.Procedure, powers, etc., of inspectors.

Section 218.Protection of employees during investigation.

Section 219.Power of inspector to conduct investigation into affairs of related companies, etc.

Section 220.Seizure of documents by inspector.

Section 221.Freezing of assets of company on inquiry and investigation.

Section 222.Imposition of restrictions upon securities.

Section 223.Inspector‘s report.

Section 224.Actions to be taken in pursuance of inspector‘s report.

Section 225.Expenses of investigation.

Section 226.Voluntary winding up of company, etc., not to stop investigation proceedings.

Section 227.Legal advisers and bankers not to disclose certain information.

Section 228.Investigation, etc., of foreign companies.

Section 229.Penalty for furnishing false statement, mutilation, destruction of documents.

COMPROMISES, ARRANGEMENTS AND AMALGAMATIONS

Section 230.Power to compromise or make arrangements with creditors and members.

Section 231.Power to Tribunal to enforce compromise or arrangement.

Section 232.Merger and amalgamation of companies.

Section 233.Merger or amalgamation of certain companies.

Section 234.Merger or amalgamation of company with foreign company.

Section 235.Power to acquire shares of shareholders dissenting from scheme or contract approved by majority.

Section 236.Purchase of minority shareholding.

Section 237.Power of Central Government to provide for amalgamation of companies in public interest.

Section 238.Registration of offer of schemes involving transfer of shares.

Section 239.Preservation of books and papers of amalgamated companies.

Section 240.Liability of officers in respect of offences committed prior to merger, amalgamation, etc.

PREVENTION OF OPPRESSION AND MISMANAGEMENT

Section 241.Application to Tribunal for relief in cases of oppression, etc.

Section 242.Powers of Tribunal.

Section 243.Consequence of termination or modification of certain agreements.

Section 244.Right to apply under section 241.

Section 245.Class action.

Section 246.Application of certain provisions to proceedings under section 241 or section 245.

REGISTERED VALUERS

Section 247.Valuation by registered valuers.

REMOVAL OF NAMES OF COMPANIES FROM THE REGISTER OF COMPANIES

Section 248.Power of Registrar to remove name of company from register of companies.

Section 249.Restrictions on making application under section 248 in certain situations.

Section 250.Effect of company notified as dissolved.

Section 251.Fraudulent application for removal of name.

Section 252.Appeal to Tribunal.

REVIVAL AND REHABILITATION OF SICK COMPANIES

Section 253.[Omitted.].

Section 254.[Omitted.].

Section 255.[Omitted.].

Section 256.[Omitted.].

Section 257.[Omitted.].

Section 258.[Omitted.].

Section 259.[Omitted.].

Section 260.[Omitted.].

Section 261.[Omitted.].

Section 262.[Omitted.].

Section 263.[Omitted.].

Section 264.[Omitted.].

Section 265.[Omitted.].

Section 266.[Omitted.].

Section 267.[Omitted.].

Section 268.[Omitted.].

Section 269.[Omitted.].

WINDING UP

Section 270.Winding up by Tribunal.

WINDING UP — PART I.—Winding up by the Tribunal

Section 271.Circumstances in which company may be wound up by Tribunal.

Section 272.Petition for winding up.

Section 273.Powers of Tribunal.

Section 274.Directions for filing statement of affairs.

Section 275.Company Liquidators and their appointments.

Section 276.Removal and replacement of liquidator.

Section 277.Intimation to Company Liquidator, provisional liquidator and Registrar.

Section 278.Effect of winding up order.

Section 279.Stay of suits, etc., on winding up order.

Section 280.Jurisdiction of Tribunal.

Section 281.Submission of report by Company Liquidator.

Section 282.Directions of Tribunal on report of Company Liquidator.

Section 283.Custody of company‘s properties.

Section 284.Promoters, directors, etc., to cooperate with Company Liquidator.

Section 285.Settlement of list of contributories and application of assets.

Section 286.Obligations of directors and managers.

Section 287.Advisory Committee.

Section 288.Submission of periodical reports to Tribunal.

Section 289.[Omitted.]

Section 290.Powers and duties of Company Liquidator.

Section 291.Provision for professional assistance to Company Liquidator.

Section 292.Exercise and control of Company Liquidator‘s powers.

Section 293.Books to be kept by Company Liquidator.

Section 294.Audit of Company Liquidator‘s accounts.

Section 295.Payment of debts by contributory and extent of set-off.

Section 296.Power of Tribunal to make calls.

Section 297.Adjustment of rights of contributories.

Section 298.Power to order costs.

Section 299.Power to summon persons suspected of having property of company, etc.

Section 300.Power to order examination of promoters, directors, etc.

Section 301.Arrest of person trying to leave India or abscond.

Section 302.Dissolution of company by Tribunal.

Section 303.Appeals from orders made before commencement of Act.

[Omitted.]. — PART III.—Provisions applicable to every mode of winding up

Section 324.Debts of all descriptions to be admitted to proof.

Section 325.[Omitted.]

Section 326.Overriding preferential payments.

Section 327.Preferential payments.

Section 328.Fraudulent preference.

Section 329.Transfers not in good faith to be void.

Section 330.Certain transfers to be void.

Section 331.Liabilities and rights of certain persons fraudulently preferred.

Section 332.Effect of floating charge.

Section 333.Disclaimer of onerous property.

Section 334.Transfers, etc., after commencement of winding up to be void.

Section 335.Certain attachments, executions, etc., in winding up by Tribunal to be void.

Section 336.Offences by officers of companies in liquidation.

Section 337.Penalty for frauds by officers.

Section 338.Liability where proper accounts not kept.

Section 339.Liability for fraudulent conduct of business.

Section 340.Power of Tribunal to assess damages against delinquent directors, etc.

Section 341.Liability under sections 339 and 340 to extend to partners or directors in firms or companies.

Section 342.Prosecution of delinquent officers and members of company.

Section 343.Company Liquidator to exercise certain powers subject to sanction.

Section 344.Statement that company is in liquidation.

Section 345.Books and papers of company to be evidence.

Section 346.Inspection of books and papers by creditors and contributories.

Section 347.Disposal of books and papers of company.

Section 348.Information as to pending liquidations.

Section 349.Official Liquidator to make payments into public account of India.

Section 350.Company Liquidator to deposit monies into scheduled bank.

Section 351.Liquidator not to deposit monies into private banking account.

Section 352.Company Liquidation Dividend and Undistributed Assets Account.

Section 353.Liquidator to make returns, etc.

Section 354.Meetings to ascertain wishes of creditors or contributories.

Section 355.Court, tribunal or person, etc., before whom affidavit may be sworn.

Section 356.Power of Tribunal to declare dissolution of company void.

Section 357.Commencement of winding up by Tribunal.

Section 358.Exclusion of certain time in computing period of limitation.

[Omitted.]. — PART IV.—Official Liquidators

Section 359.Appointment of Official Liquidator.

Section 360.Powers and functions of Official Liquidator.

Section 361.Summary procedure for liquidation.

Section 362.Sale of assets and recovery of debts due to company.

Section 363.Settlement of claims of creditors by Official Liquidator.

Section 364.Appeal by creditor.

Section 365.Order of dissolution of company.

Section 366.Companies capable of being registered.

Section 367.Certificate of registration of existing companies.

Section 368.Vesting of property on registration.

Section 369.Saving of existing liabilities.

Section 370.Continuation of pending legal proceedings.

Section 371.Effect of registration under this Part.

Section 372.Power of Court to stay or restrain proceedings.

Section 373.Suits stayed on winding up order.

Section 374.Obligations of companies registering under this Part.

PART II.—Winding up of unregistered companies

Section 375.Winding up of unregistered companies.

Section 376.Power to wind up foreign companies although dissolved.

Section 377.Provisions of Chapter cumulative.

Section 378.Saving and construction of enactments conferring power to wind up partnership firm, association or company, etc., in certain cases.

COMPANIES INCORPORATED OUTSIDE INDIA

Section 379.Application of Act to foreign companies.

Section 380.Documents, etc., to be delivered to Registrar by foreign companies.

Section 381.Accounts of foreign company.

Section 382.Display of name, etc., of foreign company.

Section 383.Service on foreign company.

Section 384.Debentures, annual return, registration of charges, books of account and their inspection.

Section 385.Fee for registration of documents.

Section 386.Interpretation.

Section 387.Dating of prospectus and particulars to be contained therein.

Section 388.Provisions as to expert‘s consent and allotment.

Section 389.Registration of prospectus.

Section 390.Offer of Indian Depository Receipts.

Section 391.Application of sections 34 to 36 and Chapter XX.

Section 392.Punishment for contravention.

Section 393.Company‘s failure to comply with provisions of this Chapter not to affect validity of contracts, etc.

GOVERNMENT COMPANIES

Section 394.Annual reports on Government companies.

Section 395.Annual reports where one or more State Governments are members of companies.

REGISTRATION OFFICES AND FEES

Section 396.Registration offices.

Section 397.Admissibility of certain documents as evidence.

Section 398.Provisions relating to filing of applications, documents, inspection, etc., in electronic form.

Section 399.Inspection, production and evidence of documents kept by Registrar.

Section 400.Electronic form to be exclusive, alternative or in addition to physical form.

Section 401.Provision of value added services through electronic form.

Section 402.Application of provisions of Information Technology Act, 2000.

Section 403.Fee for filing, etc.

Section 404.Fees, etc., to be credited into public account.

COMPANIES TO FURNISH INFORMATION OR STATISTICS

Section 405.Power of Central Government to direct companies to furnish information or statistics.

NIDHIS

Section 406.Power to modify Act in its application to Nidhis.

NATIONAL COMPANY LAW TRIBUNAL AND APPELLATE TRIBUNAL

Section 407.Definitions.

Section 408.Constitution of National Company Law Tribunal.

Section 409.Qualification of President and Members of Tribunal.

Section 410.Constitution of Appellate Tribunal.

Section 411.Qualifications of Chairperson and members of Appellate Tribunal.

Section 412.Selection of Members of Tribunal and Appellate Tribunal.

Section 413.Term of office of President, Chairperson and other Members.

Section 414.Salary, allowances and other terms and conditions of service of Members.

Section 415.Acting President and Chairperson of Tribunal or Appellate Tribunal.

Section 416.Resignation of Members.

Section 417.Removal of Members.

Section 417A.Qualifications, terms and conditions of service of Chairperson and Member.

Section 418.Staff of Tribunal and Appellate Tribunal.

Section 419.Benches of Tribunal.

Section 420.Orders of Tribunal.

Section 421.Appeal from orders of Tribunal.

Section 422.Expeditious disposal by Tribunal and Appellate Tribunal.

Section 423.Appeal to Supreme Court.

Section 424.Procedure before Tribunal and Appellate Tribunal.

Section 425.Power to punish for contempt.

Section 426.Delegation of powers.

Section 427.President, Members, officers, etc., to be public servants.

Section 428.Protection of action taken in good faith.

Section 429.Power to seek assistance of Chief Metropolitan Magistrate, etc.

Section 430.Civil court not to have jurisdiction.

Section 431.Vacancy in Tribunal or Appellate Tribunal not to invalidate acts or proceedings.

Section 432.Right to legal representation.

Section 433.Limitation.

Section 434.Transfer of certain pending proceedings.

SPECIAL COURTS

Section 435.Establishment of Special Courts.

Section 436.Offences triable by Special Courts.

Section 437.Appeal and revision.

Section 438.Application of Code to proceedings before Special Court.

Section 439.Offences to be non-cognizable.

Section 440.Transitional provisions.

Section 441.Compounding of certain offences.

Section 442.Mediation and Conciliation Panel.

Section 443.Power of Central Government to appoint company prosecutors.

Section 444.Appeal against acquittal.

Section 445.Compensation for accusation without reasonable cause.

Section 446.Application of fines.

Section 446A.Factors for determining level of punishment.

Section 446B.Lesser penalties for One Person Companies or small companies.

MISCELLANEOUS

Section 447.Punishment for fraud.

Section 448.Punishment for false statement.

Section 449.Punishment for false evidence.

Section 450.Punishment where no specific penalty or punishment is provided.

Section 451.Punishment in case of repeated default.

Section 452.Punishment for wrongful withholding of property.

Section 453.Punishment for improper use of ―Limited‖ or ―Private Limited‖.

Section 454.Adjudication of penalties.

Section 454A.Penalty for repeated default.

Section 455.Dormant company.

Section 456.Protection of action taken in good faith.

Section 457.Non-disclosure of information in certain cases.

Section 458.Delegation by Central Government of its powers and functions.

Section 459.Powers of Central Government of Tribunal to accord approval, etc., subject to conditions and to prescribe fees on applications.

Section 460.Condonation of delay in certain cases.

Section 461.Annual report by Central Government.

Section 462.Power to exempt class or classes of companies from provisions of this Act.

Section 463.Power of court to grant relief in certain cases.

Section 464.Prohibition of association or partnership of persons exceeding certain number.

Section 465.Repeal of certain enactments and savings.

Section 466.Dissolution of Company Law Board and consequential provisions.

Section 467.Power of Central Government to amend Schedules.

Section 468.Power of Central Government to make rules relating to winding up.

Section 469.Power of Central Government to make rules.

Section 470.Power to remove difficulties.