The Companies Act 1956 is an Act of the Parliament of India, enacted in 1956, which enabled Companies to be formed by registration, and set out the responsibilities of companies, their directors and secretaries.
The Companies Act 1956 is administered by the Government of India through the Ministry of Corporate Affairs and the Offices of Registrar of Companies, Official Liquidators, Public Trustee, Company Law Board, Director of Inspection, etc. The Registrar of Companies (ROC) handles incorporation of new companies and the administration of running companies.
Since its commencement, it has been amended many times, in which amendment of 1988, 1990, 1996, 2000 and 2011 are notable.
The new law has been passed and is considered as trend changer in Indian Corporate law the new law has been rewritten extensively with several new provisions for investor protection, better corporate governance and corporate social responsibility etc. It defines a number of new terms that have come into vogue in recent times.
The bill provides for class action suit, which is key weapon for individual shareholders to take collective action against errant companies. Better disclosure requirements in financial statements and disclosure of interests of directors etc. It has also streamlined procedures relating to disclosure of transactions with parties related to directors, promoters etc.
It provides for new concepts such as a one person company. Cap on number of persons in a private company raised to 200. E-voting has been recognized.
This new Act is one of the major achievement in Indian Parliamentary History in recent past.
The Companies Act 1956 is administered by the Government of India through the Ministry of Corporate Affairs and the Offices of Registrar of Companies, Official Liquidators, Public Trustee, Company Law Board, Director of Inspection, etc. The Registrar of Companies (ROC) handles incorporation of new companies and the administration of running companies.
Since its commencement, it has been amended many times, in which amendment of 1988, 1990, 1996, 2000 and 2011 are notable.
Nature and Scope of the Act
Like most of Indian acts, it also extends to the whole India except State of Jammu and Kashmir (SECTION 3) (Article 370). Notwithstanding anything contained in the Act every company, international or indigenous will work under the provisions of the Act.This Act is general in nature and not subrogative. So if a special Legislation applies on a Company, then the Company has to, in addition to Companies Act, comply the special Legislation. For example, all banking Companies in India have to comply with Banking Regulation Act 1949, in addition to the Companies Act 1956.Act's Cessation and New Act's Important Provisions and Background
The Act has now been replaced by the The Companies Act, 2013 after receiving the assent of the President of India on Thursday, 29 August 2013. The Companies Act, 2013 is divided into 29 chapters containing 470 Sections as against 658 Sections in the Companies Act, 1956. The Central Government has appointed Thursday, 12 September 2013 as the date on which some notified sections the Companies Act, 2013 shall come into force. The Ministry of Corporate Affairs has notified 183 sections of the new Companies Act, 2013, which comes into effect from April 1, 2014. With this, 283 of 470 sections of the Act have got notified in a phased manner.The new law has been passed and is considered as trend changer in Indian Corporate law the new law has been rewritten extensively with several new provisions for investor protection, better corporate governance and corporate social responsibility etc. It defines a number of new terms that have come into vogue in recent times.
The bill provides for class action suit, which is key weapon for individual shareholders to take collective action against errant companies. Better disclosure requirements in financial statements and disclosure of interests of directors etc. It has also streamlined procedures relating to disclosure of transactions with parties related to directors, promoters etc.
It provides for new concepts such as a one person company. Cap on number of persons in a private company raised to 200. E-voting has been recognized.
This new Act is one of the major achievement in Indian Parliamentary History in recent past.
