For convenience, leading
comment (marked ‘C’) is provided below, on selected portions of sec 127 (FONT supplied, to focus on):
1. “Where a dividend has been declared by a company but has not been paid or the warrant in respect thereof has not been posted…..”
C: If not mistaken,
interim dividend is not ‘declared’ (unlike, final dividend) ; but is only ‘made
unconditionally available’, if and when so resolved, by the Board..
Thus clarity is wanting; perhaps, though not made clear, the provision has to be taken to be not
intended to apply should there be a delay in posting the warrant in respect of
interim dividend.
“ 2. "Provided that no offence under this section SHALL BE DEEMED TO HAVE BEEN
committed:—….
C: In the
substantive provision/operative portion of the section (as embodied in its
opening), there is no ‘deeming’ spelt out , much less contemplated. As such, the above marked words do
not seem to make any sense. To put it differently, if at all, in substitution,
the words – “shall be treated /considered …”
could have made for a homogeneous reading, and better understanding, with the least complication.
Aside: Employing the concept of 'deeming' , and use of the word or its derivative, appropriate or not in a given context, loosely but generously, in framing any legislation, it is noted, has become almost an obsession. Looking back, one such instance came to be noted in the course of a clinical study of an amendment of sec 37; and the reference is to the confusing language adopted in the newly introduced Explanation under sub-section (1). Anyone itching or provoked to know more, simply for the kick of it, suggest to search the previous Blogs.
3. (a), (b)….
“(c) where there is a DISPUTE REGARDING
THE RIGHT TO receive the dividend;"
C : Unclear;
obviously, that refers to an instance in which , before or at the point in time
of ‘declaration’, or in any event,
before posting of the warrant, the company has a notice or an intimation, in writing, of any
such pending dispute.
4. “(d) where the
dividend has been LAWFULLY ADJUSTED by the company AGAINST ANY SUM DUE to it from the shareholder;” (FONT
supplied)
C: Possible grey
areas; having inherent potentials, to dispute.
5. “(e) where, FOR
ANY OTHER REASON, the failure to pay the dividend or to post the warrant within
the period under this section was NOT DUE TO ANY DEFAULT ON THE PART OF THE
COMPANY.”
C: No clarity as to
what is really intended. For, one thinks, the very premise on which the
provision can be invoked is that there has been a ‘default’ by (on the part of) the company. As
such, requires an elaboration; may be, by insertion of an ‘EXPLANATION’
Over to eminent law
pundits at large, for helpful input, if any !
KEY note: For a comparative discussion and feedback INput, wrt a similar provision , -sec 164, refer the separate posts on Facebook nd Linkedin.
Under both the sections- 127 and 164, it is the director of company who is made responsible for the related defaults/failures in meeting the requirements of the law.
For any further study, recommend to cross refer certain other provisions of the CA 2013, having no less bearing but not-so-obvious contextual relevance. Those are provisions dealing with the respective powers and duties of company's personnel /officers- designated as CEO, CFO, compliance officers/ company secretary, so on.
None directly or indirectly concerned, including anyone of the personnel/officers, selves, can prudently afford not to know of each one's duties and responsibilities attached to own office, but co-jointly with the rest of them, particularly the Board of Directors, being the 'trustees' and principal conscience -keepers of a corporate entity.
For a better insight and understanding and an intimate grip of the foregoing, suggest to look through the material in public domain, - say , HERE
2013 Comp Act- 'Compliance Officers'
and within, the expert article here >
https://www.icsi.edu/WebModules/CompaniesAct2013/Annexure-D.pdf
To 'spoon' feed , - the following sections of the 2013 Act, as random selected, are a MUST to go through; in the order of utmost importance in which mentioned:
Sec 2 (51),(53), (59), ....(24), (25), (38) ;
Sec 205 rw sec 203 nd 204-
The implications of the Explanation under, and sub- sec (2) of, sec 205 call for a critical study , for an incisive understanding, in proper light.
Sec 2 (60)
Sec 2 (95) rtw the defn. of 'public servant' in allied Acts
Sec 37
KEY note: For a comparative discussion and feedback INput, wrt a similar provision , -sec 164, refer the separate posts on Facebook nd Linkedin.
Under both the sections- 127 and 164, it is the director of company who is made responsible for the related defaults/failures in meeting the requirements of the law.
For any further study, recommend to cross refer certain other provisions of the CA 2013, having no less bearing but not-so-obvious contextual relevance. Those are provisions dealing with the respective powers and duties of company's personnel /officers- designated as CEO, CFO, compliance officers/ company secretary, so on.
None directly or indirectly concerned, including anyone of the personnel/officers, selves, can prudently afford not to know of each one's duties and responsibilities attached to own office, but co-jointly with the rest of them, particularly the Board of Directors, being the 'trustees' and principal conscience -keepers of a corporate entity.
For a better insight and understanding and an intimate grip of the foregoing, suggest to look through the material in public domain, - say , HERE
2013 Comp Act- 'Compliance Officers'
and within, the expert article here >
https://www.icsi.edu/WebModules/CompaniesAct2013/Annexure-D.pdf
Fact Sheet - ICSI
To 'spoon' feed , - the following sections of the 2013 Act, as random selected, are a MUST to go through; in the order of utmost importance in which mentioned:
Sec 2 (51),(53), (59), ....(24), (25), (38) ;
Sec 205 rw sec 203 nd 204-
The implications of the Explanation under, and sub- sec (2) of, sec 205 call for a critical study , for an incisive understanding, in proper light.
Sec 2 (60)
Sec 2 (95) rtw the defn. of 'public servant' in allied Acts
Sec 37
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