1. Companies Act, 1956 Anandaraj A MBA Banking Technology Pondicherry University 03/21/11 12:07
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30. C) ownership of assets In the case of a partnership, the total assets of a partnership are owned by all the partners; while in the case of company, the assets contributed by all the shareholders are owned by the company. In other words, as long as the shareholder contribute their capital, they lose the direct control of these capital. D) Management The company is managed by BOD elected by shareholders. A paternship is managed by partners except the dormant and sleeping partners. 03/21/11 12:07
31. E) legal person quality A partnership has no legal person quality, while a company has legal person quality. F) Perpetual existence A company has a perpetual existence A partnership does not have a perpetual existence. G) Contracts A member of the company can contract with company. A partner cannot contract with the partnership firm 03/21/11 12:07
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73. ALTERATION OF MEMORANDUM: 1. CHANGE OF NAME: Procedure of alteration- i. by special resolution ii. by ordinary resolution 2. CHANGE OF REGISTERED OFFICE: a. change within the city b. change within the state c. change from one state to another 03/21/11 12:07
74. Procedure of alteration- i. Special resolution ii. Confirmation by the NCLT iii. Notice to affected parties iv. Notice to Registrar v. Power of the Tribunal to confirm change discretionary vi. Rights and interests of members and creditors to be taken care of. vii. Copy of special resolution and the order of the Tribunal to be filed with the registrar. 03/21/11 12:07
75. 3. ALTERATION OF OBJECTS: The objects clause is very important clause in the Memorandum of Association. The objects of a company may be altered by special resolution so as to enable the company- a. To carry on its business more economically or more efficiently. b. To attain its main purpose by new or improved means. c. To carry on some business which may conveniently or advantageously be combined with the objects specified in the Memorandum. 03/21/11 12:07
76. d. To enlarge or change the local area of its operations. e. To restrict or abandon any of the objects specified in the Memorandum. f. To sell or dispose of the whole, or any part, of the undertaking, or of any of the undertakings, of the company; or g. To amalgamate with any other company or body of persons. 03/21/11 12:07
77. Procedure of alteration: i. Special resolution. ii. Copy of special resolution to be filed. iii. Certification of registration. 4. CHANGE IN LIABILITY CLAUSE: A company limited by shares or guarantee cannot change its Memorandum so as to impose any additional liability on the members or to compel them to buy additional shares of the company unless all the members agree in writing to such change either before or after the change (Sec.38). 5. CHANGE IN CAPITAL CLAUSE: For change in the capital clause which involves increase, reduction or reorganization of capital, refer to “Share Capital”. 03/21/11 12:07
80. DEFINITION: The Articles of Association or just Articles are the rules, regulations and bye-laws for the internal management of the affairs of a company. They are framed with the object of carrying out the aims and objects as set in the memorandum of Association. 03/21/11 12:07
81. CONTENTS OF ARTICLES: Articles usually contain provisions relating to the following matters: 1. Share capital, rights of shareholders, variation of these rights, payment of commissions, share certificates. 2. Lien on shares. 3. Calls on shares. 4. Transfer of shares. 5. Transmission of shares. 6. Forfeiture of shares. 7. Conversion of shares into stock. 8. Share warrants. 9. Alteration of capital. 10. General meetings and proceedings thereat. 03/21/11 12:07
82. 11. Voting rights of members, voting and poll, proxies. 12. Directors, their appointment, remuneration, qualifications, powers and proceedings of Board of directors. 13. Manager. 14. Secretary. 15. Dividends and reserves. 16. Accounts, audit and borrowing powers. 17. Capitalization of profits. 18. Winding up. 03/21/11 12:07
83. COMPANIES WHICH MUST HAVE THEIR OWN ARTICLES: According to Sec.26 the following companies shall have their own articles, namely, a. unlimited companies, b. companies limited by guarantee, c. private companies limited by shares. 03/21/11 12:07
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85. 3. In case of private company having a share capital the articles shall contain provisions which- a. restrict the right to transfer shares. b. limit the no. of its members to 50 c. prohibit any invitation to the public to subscribe for any shares in, or debentures of, the company. 03/21/11 12:07
86. FORM AND SIGNATURE OF ARTICLES: The shall be- a. printed, b. divided into paragraphs, and c. signed by the each subscriber of the memorandum. 03/21/11 12:07
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