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The Companies Act, 2013
Section 108

The Companies Act, 2013

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Chapter IPreliminary

1Short title, extent, commencement and application
2Definitions

Chapter IIIncorporation of Company and Matters Incidental Thereto

3Formation of company
3AMembers severally liable in certain cases
4Memorandum
5Articles
6Act to override memorandum, articles, etc
7Incorporation of company
8Formation of companies with charitable objects, etc
9Effect of registration
10Effect of memorandum and articles
10ACommencement of business, etc
11[Omitted]
12Registered office of company
13Alteration of memorandum
14Alteration of articles
15Alteration of memorandum or articles to be noted in every copy
16Rectification of name of company
17Copies of memorandum, articles, etc., to be given to members
18Conversion of companies already registered
19Subsidiary company not to hold shares in its holding company
20Service of documents
21Authentication of documents, proceedings and contracts
22Execution of bills of exchange, etc

Chapter IIIPart I.--Public offer · Part II.--Private placement

Part I.--Public offer

23Public offer and private placement
24Power of Securities and Exchange Board to regulate issue and transfer of securities, etc
25Document containing offer of securities for sale to be deemed prospectus
26Matters to be stated in prospectus
27Variation in terms of contract or objects in prospectus
28Offer of sale of shares by certain members of company
29Public offer of securities to be in dematerialised form
30Advertisement of prospectus
31Shelf prospectus
32Red herring prospectus
33Issue of application forms for securities
34Criminal liability for mis-statements in prospectus
35Civil liability for mis-statements in prospectus
36Punishment for fraudulently inducing persons to invest money
37Action by affected persons
38Punishment for personation for acquisition, etc., of securities
39Allotment of securities by company
40Securities to be dealt with in stock exchanges
41Global depository receipt

Part II.--Private placement

42Issue of shares on private placement basis

Chapter IVShare Capital and Debentures

43Kinds of share capital
44Nature of shares or debentures
45Numbering of shares
46Certificate of shares
47Voting rights
48Variation of shareholders? rights
49Calls on shares of same class to be made on uniform basis
50Company to accept unpaid share capital, although not called up
51Payment of dividend in proportion to amount paid-up
52Application of premiums received on issue of shares
53Prohibition on issue of shares at discount
54Issues of sweat equity shares
55Issue and redemption of preference shares
56Transfer and transmission of securities
57Punishment for personation of shareholder
58Refusal of registration and appeal against refusal
59Rectification of register of members
60Publication of authorised, subscribed and paid-up capital
61Power of limited company to alter its share capital
62Further issue of share capital
63Issue of bonus shares
64Notice to be given to Registrar for alteration of share capital
65Unlimited company to provide for reserve share capital on conversion into limited company
66Reduction of share capital
67Restrictions on purchase by company or giving of loans by it for purchase of its shares
68Power of company to purchase its own securities
69Transfer of certain sums to capital redemption reserve account
70Prohibition for buy-back in certain circumstances
71Debentures
72Power to nominate

Chapter VAcceptance of Deposits by Companies

73Prohibition on acceptance of deposits from public
74Repayment of deposits, etc., accepted before commencement of this Act
75Damages for fraud
76Acceptance of deposits from public by certain companies
76APunishment for contravention of section 73 or section 76

Chapter VIRegistration of Charges

77Duty to register charges, etc
78Application for registration of charge
79Section 77 to apply in certain matters
80Date of notice of charge
81Register of charges to be kept by Registrar
82Company to report satisfaction of charge
83Power of Registrar to make entries of satisfaction and release in absence of intimation from company
84Intimation of appointment of receiver or manager
85Company?s register of charges
86Punishment for contravention
87Rectification by Central Government in Register of charges

Chapter VIIManagement and Administration

88Register of members, etc
89Declaration in respect of beneficial interest in any share
90Register of significant beneficial owners in a Company
91Power to close register of members or debenture holders or other security holders
92Annual return
93Omitted
94Place of keeping and inspection of registers, returns, etc
95Registers, etc., to be evidence
96Annual general meeting
97Power of Tribunal to call annual general meeting
98Power of Tribunal to call meetings of members, etc
99Punishment for default in complying with provisions of sections 96 to 98
100Calling of extraordinary general meeting
101Notice of meeting
102Statement to be annexed to notice
103Quorum for meetings
104Chairman of meetings
105Proxies
106Restriction on voting rights
107Voting by show of hands
108Voting through electronic means
109Demand for poll
110Postal ballot
111Circulation of members‘ resolution
112Representation of President and Governors in meetings
113Representation of corporations at meeting of companies and of creditors
114Ordinary and special resolutions
115Resolutions requiring special notice
116Resolutions passed at adjourned meeting
117Resolutions and agreements to be filed
118. Minutes of proceedings of general meeting, meeting of Board of Directors and other meeting and resolutions passed by postal ballot
119Inspection of minute-books of general meeting
120Maintenance and inspection of documents in electronic form
121Report on annual general meeting
122Applicability of this Chapter to One Person Company

Chapter VIIIDeclaration and Payment of Dividend

123Declaration of dividend
124Unpaid Dividend Account
125Investor Education and Protection Fund
126Right to dividend, rights shares and bonus shares to be held in abeyance pending registration of transfer of shares
127Punishment for failure to distribute dividends

Chapter IXAccounts of Companies

128Books of account, etc., to be kept by company
129Financial statement
129APeriodical financial results
130Re-opening of accounts on court?s or Tribunal?s orders
131Voluntary revision of financial statements or Board?s report
132Constitution of National Financial Reporting Authority
133Central Government to prescribe accounting standards
134Financial statement, Board?s report, etc
135Corporate Social Responsibility
136Right of member to copies of audited financial statement
137Copy of financial statement to be filed with Registrar
138Internal Audit

Chapter XAudit and Auditors

139Appointment of auditors
140Removal, resignation of auditor and giving of special notice
141Eligibility, qualifications and disqualifications of auditors
142Remuneration of auditors
143Powers and duties of auditors and auditing standards
144Auditor not to render certain services
145Auditor to sign audit reports, etc
146Auditors to attend general meeting
147Punishment for contravention
148Central Government to specify audit of items of cost in respect of certain companies

Chapter XIAppointment and Qualifications of Directors

149Company to have Board of Directors
150Manner of selection of independent directors and maintenance of data bank of independent directors
151Appointment of director elected by small shareholders
152Appointment of directors
153Application for allotment of Director Identification Number
154Allotment of Director Identification Number
155Prohibition to obtain more than one Director Identification Number
156Director to intimate Director Identification Number
157Company to inform Director Identification Number to Registrar
158Obligation to indicate Director Identification Number
159Penalty for default of certain provisions
160Right of persons other than retiring directors to stand for directorship
161Appointment of additional director, alternate director and nominee director
162Appointment of directors to be voted individually
163Option to adopt principle of proportional representation for appointment of directors
164Disqualifications for appointment of director
165Number of directorships
166Duties of directors
167Vacation of office of director
168Resignation of director
169Removal of directors
170Register of directors and key managerial personnel and their shareholding
171Members‘ right to inspect
172Penalty

Chapter XIIMeetings of Board and Its Powers

173Meetings of Board
174Quorum for meetings of Board
175Passing of resolution by circulation
176Defects in appointment of directors not to invalidate actions taken
177Audit committee
178Nomination and Remuneration Committee and Stakeholders Relationship Committee
179Powers of Board
180Restrictions on powers of Board
181Company to contribute to bona fide and charitable funds, etc
182Prohibitions and restrictions regarding political contributions
183Power of Board and other persons to make contributions to national defence fund, etc
184Disclosure of interest by director
185Loan to directors, etc
186Loan and investment by company
187Investments of company to be held in its own name
188Related party transactions
189Register of contracts or arrangements in which directors are interested
190Contract of employment with managing or whole-time directors
191Payment to director for loss of office, etc., in connection with transfer of undertaking, property or shares
192Restriction on non-cash transactions involving directors
193Contract by One Person Company
194Prohibition on forward dealings in securities of company by director or key managerial personnel
195Prohibition on insider trading of securities

Chapter XIIIAppointment and Remuneration of Managerial Personnel

196Appointment of managing director, whole-time director or manager
197Overall maximum managerial remuneration and managerial remuneration in case of absence or inadequacy of profits
198Calculation of profits
199Recovery of remuneration in certain cases
200Central Government or company to fix limit with regard to remuneration
201Forms of, and procedure in relation to, certain applications
202Compensation for loss of office of managing or whole-time director or manager
203Appointment of key managerial personnel
204Secretarial audit for bigger companies
205Functions of company secretary

Chapter XIVInspection, Inquiry and Investigation

206Power to call for information, inspect books and conduct inquiries
207Conduct of inspection and inquiry
208Report on inspection made
209Search and seizure
210Investigation into affairs of company
211Establishment of Serious Fraud Investigation Office
212Investigation into affairs of company by Serious Fraud Investigation Office
213Investigation into company?s affairs in other cases
214Security for payment of costs and expenses of investigation
215Firm, body corporate or association not to be appointed as inspector
216Investigation of ownership of company
217Procedure, powers, etc., of inspectors
218Protection of employees during investigation
219Power of inspector to conduct investigation into affairs of related companies, etc
220Seizure of documents by inspector
221Freezing of assets of company on inquiry and investigation
222Imposition of restrictions upon securities
223Inspector?s report
224Actions to be taken in pursuance of inspector?s report
225Expenses of investigation
226Voluntary winding up of company, etc., not to stop investigation proceedings
227Legal advisers and bankers not to disclose certain information
228Investigation, etc., of foreign companies
229Penalty for furnishing false statement, mutilation, destruction of documents

Chapter XVCompromises, Arrangements and Amalgamations

230Power to compromise or make arrangements with creditors and members
231Power to Tribunal to enforce compromise or arrangement
232Merger and amalgamation of companies
233Merger or amalgamation of certain companies
234Merger or amalgamation of company with foreign company
235Power to acquire shares of shareholders dissenting from scheme or contract approved by majority
236Purchase of minority shareholding
237Power of Central Government to provide for amalgamation of companies in public interest
238Registration of offer of schemes involving transfer of shares
239Preservation of books and papers of amalgamated companies
240Liability of officers in respect of offences committed prior to merger, amalgamation, etc

Chapter XVIPrevention of Oppression and Mismanagement

241Application to Tribunal for relief in cases of oppression, etc
242Powers of Tribunal
243Consequence of termination or modification of certain agreements
244Right to apply under section 241
245Class action
246Application of certain provisions to proceedings under section 241 or section 245

Chapter XVIIRegistered Valuers

247Valuation by registered valuers

Chapter XVIIIRemoval of Names of Companies from the Register of Companies

248Power of Registrar to remove name of company from register of companies
249Restrictions on making application under section 248 in certain situations
250Effect of company notified as dissolved
251Fraudulent application for removal of name
252Appeal to Tribunal

Chapter XIXRevival and Rehabilitation of Sick Companies

253Determination of sickness
254Application for revival and rehabilitation
255Exclusion of certain time in computing period of limitation
256Appointment of interim administrator
257Committee of creditors
258Order of Tribunal
259Appointment of administrator
260Powers and duties of company administrator
261Scheme of revival and rehabilitation
262Sanction of scheme
263Scheme to be binding
264Implementation of scheme
265Winding up of company on report of company administrator
266Power of Tribunal to assess damages against delinquent directors, etc
267Punishment for certain offences
268Bar of jurisdiction
269Rehabilitation and Insolvency Fund

Chapter XXWinding Up

270Modes of winding up
271Circumstances in which company may be wound up by Tribunal
272Petition for winding up
273Powers of Tribunal
274Directions for filing statement of affairs
275Company Liquidators and their appointments
276Removal and replacement of liquidator
277Intimation to Company Liquidator, provisional liquidator and Registrar
278Effect of winding up order
279Stay of suits, etc., on winding up order
280Jurisdiction of Tribunal
281Submission of report by Company Liquidator
282Directions of Tribunal on report of Company Liquidator
283Custody of company‘s properties
284Promoters, directors, etc., to cooperate with Company Liquidator
285Settlement of list of contributories and application of assets
286Obligations of directors and managers
287Advisory Committee
288Submission of periodical reports to Tribunal
289Power of Tribunal on application for stay of winding up
290Powers and duties of Company Liquidator
291Provision for professional assistance to Company Liquidator
292Exercise and control of Company Liquidator‘s powers
293Books to be kept by Company Liquidator
294Audit of Company Liquidator‘s accounts
295Payment of debts by contributory and extent of set-off
296Power of Tribunal to make calls
297Adjustment of rights of contributories
298Power to order costs
299Power to summon persons suspected of having property of company, etc
300Power to order examination of promoters, directors, etc
301Arrest of person trying to leave India or abscond
302Dissolution of company by Tribunal
303Appeals from orders made before commencement of Act
304Circumstances in which company may be wound up voluntarily
305Declaration of solvency in case of proposal to wind up voluntarily
306Meeting of creditors
307Publication of resolution to wind up voluntarily
308Commencement of voluntary winding up
309Effect of voluntary winding up
310Appointment of Company Liquidator
311Power to remove and fill vacancy of Company Liquidator
312Notice of appointment of Company Liquidator to be given to Registrar
313Cesser of Board‘s powers on appointment of Company Liquidator
314Powers and duties of Company Liquidator in voluntary winding up
315Appointment of committees
316Company Liquidator to submit report on progress of winding up
317Report of Company Liquidator to Tribunal for examination of persons
318Final meeting and dissolution of company
319Power of Company Liquidator to accept shares, etc., as consideration for sale of property of company
320Distribution of property of company
321Arrangement when binding on company and creditors
322Power to apply to Tribunal to have questions determined, etc
323Costs of voluntary winding up
324Debts of all descriptions to be admitted to proof
325Application of insolvency rules in winding up of insolvent companies
326Overriding preferential payments
327Preferential payments
328Fraudulent preference
329Transfers not in good faith to be void
330Certain transfers to be void
331Liabilities and rights of certain persons fraudulently preferred
332Effect of floating charge
333Disclaimer of onerous property
334Transfers, etc., after commencement of winding up to be void
335Certain attachments, executions, etc., in winding up by Tribunal to be void
336Offences by officers of companies in liquidation
337Penalty for frauds by officers
338Liability where proper accounts not kept
339Liability for fraudulent conduct of business
340Power of Tribunal to assess damages against delinquent directors, etc
341Liability under sections 339 and 340 to extend to partners or directors in firms or companies
342Prosecution of delinquent officers and members of company
343Company Liquidator to exercise certain powers subject to sanction
344Statement that company is in liquidation
345Books and papers of company to be evidence
346Inspection of books and papers by creditors and contributories
347Disposal of books and papers of company
348Information as to pending liquidations
349Official Liquidator to make payments into public account of India
350Company Liquidator to deposit monies into scheduled bank
351Liquidator not to deposit monies into private banking account
352Company Liquidation Dividend and Undistributed Assets Account
353Liquidator to make returns, etc
354Meetings to ascertain wishes of creditors or contributories
355Court, tribunal or person, etc., before whom affidavit may be sworn
356Power of Tribunal to declare dissolution of company void
357Commencement of winding up by Tribunal
358Exclusion of certain time in computing period of limitation
359Appointment of Official Liquidator
360Powers and functions of Official Liquidator
361Summary procedure for liquidation
362Sale of assets and recovery of debts due to company
363Settlement of claims of creditors by Official Liquidator
364Appeal by creditor
365Order of dissolution of company

Chapter XXIPARTI.--Companies authorised to Register under this Act · Part II.--Winding up of unregistered companies

PARTI.--Companies authorised to Register under this Act

366Companies capable of being registered
367Certificate of registration of existing companies
368Vesting of property on registration
369Saving of existing liabilities
370Continuation of pending legal proceedings
371Effect of registration under this Part
372Power of Court to stay or restrain proceedings
373Suits stayed on winding up order
374Obligations of companies registering under this Part

Part II.--Winding up of unregistered companies

375Winding up of unregistered companies
376Power to wind up foreign companies although dissolved
377Provisions of Chapter cumulative
378Saving and construction of enactments conferring power to wind up partnership firm, association or company, etc., in certain cases

Chapter XXIAPreliminary · Incorporation of Producer Companies and Other Matters · Management of Producer Company · General Meetings · Share Capital and Members Rights · Finance, Accounts and Audit · Loans to Members and Investments · Penalties · Amalgamation, Merger or Division · Resolution of Disputes · Miscellaneous Provisions · Re-conversion of Producer Company to Inter-state Co-operative Society

Preliminary

378ADefinitions

Incorporation of Producer Companies and Other Matters

378-IAmendment of articles
378BObjects of producer company
378CFormation of Producer Company and its registration
378DMembership and voting rights of Members of Producer Company
378EBenefits to Members
378FMemorandum of Producer Company
378GArticles of association
378HAmendment of memorandum
378JOption to inter-State co-operative societies to become Producer Companies
378KEffect of incorporation of Producer Company
378LVesting of undertaking in Producer Company
378MConcession, etc., to be deemed to have been granted to Producer Company
378NProvisions in respect of officers and other employees of inter-State co-operative society

Management of Producer Company

378-ONumber of directors
378PAppointment of directors
378QVacation of office by directors
378RPowers and functions of Board
378SMatters to be transacted at general meeting
378TLiability of directors
378UCommittee of directors
378VMeetings of Board and quorum
378WChief Executive and his functions
378XSecretary of Producer Company
378YQuorum
378ZVoting rights

General Meetings

378ZAAnnual general meetings

Share Capital and Members Rights

378ZBShare capital
378ZCSpecial user rights
378ZDTransferability of shares and attendant rights

Finance, Accounts and Audit

378Z-IGeneral and other reserves
378ZEBooks of account
378ZFInternal audit
378ZGDuties of auditor under this Chapter
378ZHDonation or subscription by Producer Company
378ZJIssue of bonus shares

Loans to Members and Investments

378ZKLoan, etc., to Members
378ZLInvestment in other companies, formation of subsidiaries, etc

Penalties

378ZMPenalty for contravention

Amalgamation, Merger or Division

378ZNAmalgamation, merger or division, etc., to form new Producer Companies

Resolution of Disputes

378Z-ODisputes

Miscellaneous Provisions

378ZPStrike off name of Producer Company
378ZQProvisions of this Chapter to override other laws
378ZRApplication of provisions relating to private companies

Re-conversion of Producer Company to Inter-state Co-operative Society

378ZSRe-conversion of Producer Company to inter-State co-operative society
378ZTPower to modify Act in its application to Producer Companies
378ZUPower to make rules

Chapter XXIICompanies Incorporated Outside India

379Application of Act to foreign companies
380Documents, etc., to be delivered to Registrar by foreign companies
381Accounts of foreign company
382Display of name, etc., of foreign company
383Service on foreign company
384Debentures, annual return, registration of charges, books of account and their inspection
385Fee for registration of documents
386Interpretation
387Dating of prospectus and particulars to be contained therein
388Provisions as to expert?s consent and allotment
389Registration of prospectus
390Offer of India Depository Receipts
391Application of sections 34 to 36 and Chapter XX
392Punishment for contravention
393Company?s failure to comply with provisions of this Chapter not to affect validity or contracts, etc

Chapter XXIIIGovernment Companies

394Annual reports on Government companies
395Annual reports where one or more State Governments are members of companies

Chapter XXIVRegistration Offices and Fees

396Registration offices
397Admissibility of certain documents as evidence
398Provisions relating to filing of applications, documents, inspection, etc., in electronic form
399Inspection, production and evidence of documents kept by Registrar
400Electronic form to be exclusive, alternative or in addition to physical form
401Provision of value added services through electronic form
402Application of provisions of Information Technology Act, 2000
403Fee for filing, etc
404Fees, etc., to be credited into public account

Chapter XXVCompanies to Furnish Information or Statistics

405Power of Central Government to direct companies to furnish information or statistics

Chapter XXVINidhis

406Provision relating to Nidhis and its application, etc

Chapter XXVIINational Company Law Tribunal and Appellate Tribunal

407Definitions
408Constitution of National Company Law Tribunal
409Qualification of President and Members of Tribunal
410Constitution of Appellate Tribunal
411Qualifications of Chairperson and members of Appellate Tribunal
412Selection of Members of Tribunal and Appellate Tribunal
413Term of office of President, Chairperson and other Members
414Salary, allowances and other terms and conditions of service of Members
415Acting President and Chairperson of Tribunal or Appellate Tribunal
416Resignation of Members
417Removal of Members
417AQualifications, terms and conditions of service of Chairperson and Member
418Staff of Tribunal and Appellate Tribunal
418ABenches of Appellate Tribunal
419Benches of Tribunal
420Orders of Tribunal
421Appeal from orders of Tribunal
422Expeditious disposal by Tribunal and Appellate Tribunal
423Appeal to Supreme Court
424Procedure before Tribunal and Appellate Tribunal
425Power to punish for contempt
426Delegation of powers
427President, Members, officers, etc., to be public servants
428Protection of action taken in good faith
429Power to seek assistance of Chief Metropolitan Magistrate, etc
430Civil court not to have jurisdiction
431Vacancy in Tribunal or Appellate Tribunal not to invalidate acts or proceedings
432Right to legal representation
433Limitation
434Transfer of certain pending proceedings

Chapter XXVIIISpecial Courts

435Establishment of Special Courts
436Offences triable by Special Courts
437Appeal and revision
438Application of Code to proceedings before Special Court
439Offences to be non-cognizable
440Transitional provisions
441Compounding of certain offences
442Mediation and Conciliation Panel
443Power of Central Government to appoint company prosecutors
444Appeal against acquittal
445Compensation for accusation without reasonable cause
446Application of fines
446AFactors for determining level of punishment
446BLesser penalties for One Person Companies or small companies

Chapter XXIXMiscellaneous

447Punishment for fraud
448Punishment for false statement
449Punishment for false evidence
450Punishment where no specific penalty or punishment is provided
451Punishment in case of repeated default
452Punishment for wrongful withholding of property
453Punishment for improper use of ?Limited? or ?Private Limited?
454Adjudication of penalties
454APenalty for repeated default
455Dormant company
456Protection of action taken in good faith
457Non-disclosure of information in certain cases
458Delegation by Central Government of its powers and functions
459Power of Central Government of Tribunal to accord approval, etc., subject to conditions and to prescribe fees on applications
460Condonation of delay in certain cases
461Annual report by Central Government
462Power to exempt class or classes of companies from provisions of this Act
463Power of court to grant relief in certain cases
464Prohibition of association or partnership of persons exceeding certain number
465Repeal of certain enactments and savings
466Dissolution of Company Law Board and consequential provisions
467Power of Central Government to amend Schedules
468Power of Central Government to make rules relating to winding up
469Power of Central Government to make rules
470Power to remove difficulties

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The Companies Act, 2013 108Chapter VII · Management and Administration

Section 108 · Voting through electronic means

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The Central Government may prescribe the class or classes of companies and manner in which a member may exercise his right to vote by the electronic means.

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