Wednesday, 17 April 2019

Company Registration in Tirupur

Company Registration in Tirupur

Company Registration in Tirupur

Companies Act, 1956: Section 62

Section 62 of the 1956 Act provided for a civil liability with more defenses for such a claim. For example, it was open to a person against whom a claim was made to show that upon becoming aware of an untrue statement, he withdrew his consent to issue the prospectus before the allotment could be made. Qualitative defenses were statutorily available under the 1956 Act, to demonstrate reasonable expectations of the person against whom the claim is made. The Companies (Amendment) Act, 1960 amended section 62 of the 1956 Act and accordingly words, brackets and letter "clause (b) of" were omitted from the proviso to sub-section (1) of section 62 of the 1956 Act.
Subsequently, the Companies (Amendment) Act, 2000 empowered SEBI to administer the provisions of section 62 of the 1956 Act in relation to listed companies and those which intended to get listed; however, the provisions relating to all other companies were to be administered by the Central Government. The Companies (Amendment) Act, 2000 also vested in SEBI the power to inspect books of account and other books and papers with respect to listed companies and the companies which intended to get listed. SEBI was also authorized to file complaints under section 621 of the 1956 Act for offences relating to issue and transfer of securities and non-payment of dividend.

Recommendation of Company Law Committee

The amendments made to section 62 of the 1956 Act were explained by the Company Law Committee, thus: "This follows English s. 43 and seeks to amend s. 100 of our Act. Two principal amendments may be noted. Under sub-clause (ii) of clause (d) to sub-section (2), the onus of proving that there was reasonable ground to believe that the expert was competent to make the statement contained in the prospectus has now been shifted from the plaintiff to the defendant. This gives effect to an important recommendation made in paragraph 43 of the Cohen report. The other amendment is contained in sub-section (3) which regulates the expert's liability. Under this sub-section, the expert is label as a  person authorizing the issue of a prospectus, unless he can establish his bona fides under any of the pleas available to him under the sub-section."

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