Summary The companies act 2013 ca foundation business law

CA Foundation
Paper 2 - Business Law




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Chapter 6 (TCA)
The Companies Act, 2013

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Notes by - CA Chaitanya Jain
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Table of Contact for the Chapter
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INTRODUCTION.................................................................................................................................................................................2
APPLICABILITY OF THE COMPANIES ACT, 2013:............................................................................................................... 3
COMPANY: MEANING AND ITS FEATURES.......................................................................................................................... 4
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CLASSES OF COMPANIES UNDER THE ACT.................................................................................................................... 14
MODE OF REGISTRATION/INCORPORATION OF COMPANY...................................................................................29
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CLASSIFICATION OF CAPITAL..................................................................................................................................................37
SHARES................................................................................................................................................................................................38
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MEMORANDUM OF ASSOCIATION....................................................................................................................................... 41
DOCTRINE OF ULTRA VIRES..................................................................................................................................................... 45
ARTICLES OF ASSOCIATION.................................................................................................................................................... 50
DOCTRINE OF INDOOR MANAGEMENT.............................................................................................................................52
EXCEPTIONS TO THE DOCTRINE OF INDOOR MANAGEMENT:........................................................................... 55
“ PROBLEM KYA HAI ? ”.................................................................................................................................................................58

,6 ▶️ The Companies Act, 2013
INTRODUCTION




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2 Notes by CA Chaitanya Jain

, The Companies Act, 2013 ◀️ 6
● The Companies Act, 2013 was enacted to -
Consolidate and Amend the law relating to the companies.
● Extent to the whole of India
● The Companies Act, 2013
○ The Companies Act, 1956 —-->> 1942 —-->>1913
● The Act contains -
○ 470 sections and




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○ 7 schedules.




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○ 29 chapters.




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○ A substantial part of this Act is in the form of Companies Rules.
● The Companies Act, 2013 aims to improve -
○ corporate governance,
○ simplify regulations,




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○ strengthen the interests of minority investors and
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○ for the first time legislates the role of whistle-blowers and provisions relating
to class action suit.
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APPLICABILITY OF THE COMPANIES ACT, 2013:

The provisions of the Act shall apply to-

Companies Insurance Banking Electricity Companies
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incorporate companies companies Companies governed by
d under this except those except those (generation any special
Act or under provisions provisions or supply) Act.
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any previous inconsistent inconsistent except those
company law. with The with The provisions
Insurance Banking inconsistent
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Act, 1938 or Regulation with The
the IRDA Act, Act, 1949 Electricity
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1999) Act, 2003




Notes by CA Chaitanya Jain 3

, 6 ▶️ The Companies Act, 2013
COMPANY: MEANING AND ITS FEATURES

Meaning

Chief Justice Marshall -

1. A corporation is an artificial being, invisible, intangible, existing only in
contemplation of law. Being a mere creation of law, it possesses only those
properties which the charter of its creation confers upon it, either expressly or as




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accidental to its very existence.




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2. Professor Haney -

A company is an incorporated association, which is an artificial person created by
law, having a separate entity, with a perpetual succession and a common seal.




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3. Section 2(20) of the Companies Act, 2013 -
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“Company means a company incorporated under this Act or under any previous
company law”.
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FEATURES OF A COMPANY


Registered group of members. Public
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I Incorporated Association
7 and Private 2


As per the Articles as shares are
movable property. In Pvt restricted
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T Transferability of Shares
but not prohibited & in Public freely
transferable
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Members do not participate in day to
day affairs. The company is managed
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Ownership - separate from its
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members by BOD elected by members. So
ultimate control of members

Members may come and go but
P Perpetual Succession
company goes on forever.




4 Notes by CA Chaitanya Jain