Overview of Companies Act 2013

The Companies Act, 2013 is the primary legislation governing the registration, regulation, and dissolution of companies in India. It was enacted to enhance corporate governance, protect shareholders’ interests, and ensure accountability among companies.

Key Features of the Companies Act, 2013:

• Incorporation of Companies: Simplified process for the incorporation of companies and registration with the Registrar of Companies (RoC).
• Corporate Social Responsibility (CSR): Mandates certain companies to spend on CSR activities, promoting ethical business practices.
• Classifications of Companies: Defines various types of companies, including private, public, and one-person companies (OPC).
• Directors’ Responsibilities: Enhances the accountability of directors and outlines their fiduciary duties and powers.
• Regulations on Financial Statements: Sets guidelines for the preparation, approval, and audit of financial statements.
• Fraudulent Activities: Introduces stringent penalties for fraud, ensuring transparency and ethical behavior in corporate governance.

Companies Act, 2013 – Key Sections Overview

Chapter I: Preliminary

• Section 1 – Short Title, Extent, Commencement, and Application
• Section 2 – Definitions (important terms like Company, Director, Shareholder, etc.)

Chapter II: Incorporation of Company and Matters Incidental Thereto

• Section 3 – Formation of Company
• Section 4 – Memorandum of Association
• Section 5 – Articles of Association
• Section 7 – Incorporation of Company
• 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 21 – Authentication of Documents, Proceedings, and Contracts

Chapter III: Prospectus and Allotment of Securities

• Section 23 – Public Offer and Private Placement
• Section 26 – Matters to Be Stated in Prospectus
• Section 28 – Offer of Sale of Shares by Certain Members of Company
• Section 34 – Criminal Liability for Misstatements in Prospectus
• Section 35 – Civil Liability for Misstatements in Prospectus

Chapter IV: Share Capital and Debentures

• Section 43 – Kinds of Share Capital
• Section 44 – Nature of Shares or Debentures
• Section 45 – Shares or Debentures to Be Numbered
• Section 46 – Certificate of Shares
• Section 47 – Voting Rights
• Section 52 – Securities Premium Account
• Section 55 – Issue and Redemption of Preference Shares
• Section 61 – Power of Limited Company to Alter Its Share Capital

Chapter V: Acceptance of Deposits by Companies

• Section 73 – Prohibition on Acceptance of Deposits from Public
• Section 76 – Acceptance of Deposits from Public by Certain Companies

Chapter VI: 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

Chapter VII: Management and Administration

• Section 88 – Register of Members, etc.
• Section 92 – Annual Return
• Section 96 – Annual General Meeting
• Section 100 – Calling of Extraordinary General Meeting
• Section 101 – Notice of Meeting
• Section 105 – Proxies
• Section 108 – Voting Through Electronic Means
• Section 118 – Minutes of Proceedings of General Meeting, Meeting of Board, etc.

Chapter IX: Accounts of Companies

• Section 128 – Books of Account, etc., to Be Kept by Company
• Section 129 – Financial Statement
• Section 134 – Financial Statement, Board’s Report, etc.
• Section 135 – Corporate Social Responsibility (CSR)
• Section 136 – Right of Member to Copies of Audited Financial Statement
• Section 137 – Copy of Financial Statement to Be Filed with Registrar

Chapter X: 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 143 – Powers and Duties of Auditors and Auditing Standards
• Section 147 – Punishment for Contravention

Chapter XI: 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
• Section 151 – Appointment of Director Elected by Small Shareholders
• Section 152 – Appointment of Directors
• Section 161 – Appointment of Additional Director, Alternate Director, and Nominee Director

Chapter XII: Meetings of Board and Its Powers

• Section 173 – Meetings of Board
• Section 177 – Audit Committee
• Section 178 – Nomination and Remuneration Committee and Stakeholders Relationship Committee
• Section 179 – Powers of Board
• Section 184 – Disclosure of Interest by Director
• Section 185 – Loans to Directors, etc.
• Section 186 – Loan and Investment by Company
• Section 188 – Related Party Transactions

Chapter XX: Winding Up

• Section 270 – Modes of Winding Up
• Section 271 – Circumstances in Which Company May Be Wound Up by Tribunal
• Section 272 – Petition for Winding Up
• Section 304 – Circumstances in Which Company May Be Wound Up Voluntarily
• Section 319 – Power of Company Liquidator to Accept Shares, etc., as Consideration for Sale of Property of Company