Trade Marks Act - Defendant's adoption of Trademark is not in good faith and potential confusion encroaches upon Plaintiff's statutory trademark rights : HC (See 'Legal Desk') SEBI Act - Noticee was maintaining call records which were sent to SEBI : SEBI (See 'Legal Desk') Arbitration - Petition u/s 29A for extension of mandate of Arbitral Tribunal can be filed even after mandate has expired : HC (See 'Legal Desk') Mines Ministry to hold 2-day Critical Minerals Summit (See 'Corp Brief') IBC - When one party owes debt to another and creditor is claiming under written agreement providing for rendering 'service', debt is operational debt if claim of debt has some connection with service : SC (See 'Legal Desk') Companies Act - Stamp duty @5% market value of property is liable to be paid only when property is situated within State of Madhya Pradesh otherwise not : HC (See 'Legal Desk') SEBI Act - Final opportunity of inspection of documents and cross-examination of witnesses should be given to Appellants : SAT (See 'Legal Desk') SARFAESI Act - Mere discovery of new or important matter or evidence is not a sufficient ground for review ex debito justitiae : HC (See 'Legal Desk') Conference organized on Maritime Amrit Kaal Vision 2047 (See 'Corp Brief') PMLA -Bail application can be dismissed as petitioner failed to satisfy conditions for grant of bail : HC (See 'Legal Desk') CSIR, NIScPR organize national workshop to celebrate World Intellectual Property Day (See 'Corp Brief') SEBI Act - Appellants have failed to substantiate their claim of financial distress nor have they brought any new fact or circumstances requiring grant of interim relief : SAT (See 'Legal Desk') ACC delivers lifetime highest annualised PAT (See 'Corp Brief') Trade Mark Act - Marks are visually phonetically and deceptively similar to Plaintiffs' trademarks : HC (See 'Legal Desk') SJVN inaugurates First Multi-purpose Green Hydrogen Pilot Project (See 'Corp Brief') IBC - Even if CIRP commences, Directors, who are incharge of affairs of Company cannot be absolved of any wilful default committed by borrower Company : HC (See 'Legal Desk') REC to extend loan of Rs 1869 Cr for Kiru Hydro Electric Project (See 'Corp Brief')

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MCA invites comments on Rules to prevent creation of shell companies

Published: Jun 30, 2017

By TIOLCORP News Service

NEW DELHI, JUNE 30 2017: The Ministry of Corporate Affairs (MCA) has informed vide a public notice that based on the suggestion received from various stakeholders, it is considering of commencing the proviso to clause (87) of section 2 of the Companies Act, 2013. The said proviso aims at restricting class or classes of holding companies from having layers of subsidiaries beyond prescribed number.

Accordingly, a notification proposing amendments to the Companies (Specification of Definitions Details) Rules, 2014 containing the above prescription has been drafted and is available, along with a background/explanatory note, on the online portal of the Ministry. MCA has decided to invite suggestions/comments on the draft notification/rules from stakeholders. Comments/suggestions on the draft rules along with justifications in brief may be sent latest by 20th July, 2017 through email at csddar@mca.gov.in., in the prescribed format.

The said provision, along with layering restriction on investment subsidiaries under Section 186(1) of Companies Act, 2013, were incorporated with a view to check misuse of multiple layers of subsidiaries for diversion of funds/siphoning off funds as a measure of minority investor protection and is in consonance with recommendations of the Standing Committee on Finance on the Companies Bill, 2009. The proviso to section 2(87) of the Companies Act, 2013 and sub-section (1) of section 186 were, however, sought to be omitted in the Companies (Amendment) Bill, 2016 following recommendations by the Companies Law Committee (CLC) in its report given during February, 2016. Subsequently, in view of reports of misuse of multiple layers of companies, where companies create shell companies for diversion of funds or money laundering, it has been decided to retain the provisions. It has now been decided to commence the proviso to section 2(87).

See Public Notice

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