Corporate Mania

Some month ago number of directors disqualified by the Ministry of Corporate Affairs has touched more than 300,000 according to the provisions of Section 164(2)(a) of the Companies Act, 2013. Note: Section 164(2) stated as follow; No person who is or has been a director of a company which— (a) has not filed financial statements or annual returns for any continuous period of three financial years; or (b) has failed to repay the deposits accepted by it or pay interest thereon or to redeem any debentures on the due date or pay interest due thereon or pay any dividend declared and such failure to pay or redeem continues for one year or more, shall be eligible to be re-appointed as a director of that company or appointed in other company for a period of five years from the date on which the said company fails to do so. Pursuant to the above said provision it perceived that a person who is or has been a Director of defaulting company shall attract disqualification...

As we are aware about that Companies (Amendment) Bill, 2017 was introduced in Lok Sabha (Lower House) on Wednesday, 16 th Day of March, 2016 which has been passed by the Lok Sabha on Sunday, 02 nd Day of July, 2017 and further bill referred to Rajya Sabha (Upper House) for consideration and passing, after consideration of Bill, Rajya Sabha (Upper house) has passed the Companies (Amendment) Bill, 2017 on Tuesday, 19 th Day of December, 2017. After getting the assent of President it shall come into force. Section 42 (PRIVATE PLACEMENT) For section 42 of the principal Act, the following section shall be substituted, namely: “(1) A company may, subject to the provisions of this section, make a private placement of securities. (2) A private placement shall be made only to a select group of persons who have been identified by the Board (herein referred to as "identified persons"), whose number shall not exceed fifty or such higher number as may be prescribed ...