24 July 2012

Companies (Second Amendment) Act,2002

MCA Updates
Enforcement of certain provisions of Companies (Second Amendment) Act, 2002
Companies (Second Amendment) Act, 2002, which proposes to bring about several regulatory and procedural changes in Companies Act, 1956 through insertion of provisions in the Act and amendment in various sections of Companies Act, 1956, is not effective till date.
Section 2 of the Amendment Act states that Central Government may appoint a date, by notification in the Official Gazette to bring into force the amendment Act, provided that different dates may be appointed to give into effect different sections of the amendment Act. Drawing its authority from this section, the Ministry of Corporate Affairs, vide Notification S.O. (E) dated July 10, 2012 has notified August 12, 2012 as the effective date of Companies (Second Amendment) Act, 2002, w.r.t. certain sections of Companies Act, 1956. This is for the first time that a date has been notified for any of the sections of the amendment Act, as none of its sections has taken effect till date.
Sections of Companies Act, 1956 which fall under the purview of the Notification and in respect to which the date has been notified are detailed as follows:

Section 17, Section 18 and Section 19 of Companies Act, 1956
Section 17 provides for alteration in Objects Clause of Memorandum of Association and change in Registered Office of companies from one State to another and matters related thereto. The effective amendment calls for the substitution of the text of section with the amended text as provided in Section 7 of the Amendment Act, whereby the authority governing the change in Registered Office from one State to another will be shifted from Company Law Board to Central Government.
Sections 18 prescribes for registration of the Order passed under section 17 and Section 19 specifies the effect of failure to register the same. and in this context the amendment, substitutes the word "Company Law Board" has been substituted with the word "Central Government" in both these sections, as provided in Section 8 of the Amendment Act.
However, it is to be further noted that the Ministry through another Notification S.O.(E) dated July 10, 2012, has further delegated powers of Central Government under the aforementioned sections to the concerned Regional Directors.

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