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28May
Cyber Crimes and Security

In this growing digital age, we have become more dependent on the internet for many of our daily activities. Be it communicating with friends, searching for information, doing banking transactions, availing online services, finding job, finding life partner or even running entire businesses. The internet touches almost all aspects of our lives.

There are both advantages and disadvantages of using internet. Everyday, we see new cyber crimes being reported. Though Government Agencies are equipped to deal with cyber crimes, it is our duty to take precautions to remain safe.

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24May
NCLAT Orders that MCA need not be party

National Company Law Appellate Tribunal, New Delhi (NCLAT) on the appeal of Ministry of Corporate Affairs issued, set aside 1 the omnibus order dated of 22.11.2019 2 of the National Company Law Tribunal (NCLT), Principal Bench, New Delhi, whereby it ordered that in all petitions of IBC and Company Petitions, Ministry of Corporate Affairs shall always be arrayed as one of the Respondent. 

The NCLAT vide its order dated 22.05.2020 observed that NCLT does not have any such power to make such order. Further, the order of NCLT was passed without hearing ministry of Corporate Affairs and hence principal of natural justice has been violated.  

Read MoreReferences
  1. NCLAT order dated 22.05.2020 in the Company Appeal No.1417 of 2019[↩]
  2. NCLT, Delhi order dated 22.11.2019 in (IB)-939(PB)/2018[↩]
21May
MCA extends period for names reserved and Forms resubmission

Ministry of Corporate Affairs (MCA) has issued a statement on 20 May, 2020 1 which states that Names expiring any day between 15th March, 2020 to 31st May would be extended by 20 days beyond 31st May 2020. It has also stated that SRNs where last date of Resubmission (RSUB) falls between 15th March 2020 to 31st May, 2020, additional 15 days beyond 31st May 2020 would be allowed. For details on MCA extends period for names reserved and Forms resubmission, please click the following link.

References
  1. MCA Statement 20 May, 2020[↩]
20May
SEBI Advisory on disclosure of material impact of COVID–19

The COVID–19 pandemic and the consequent lockdown restrictions imposed  by government has severally impacted businesses. SEBI Advisory says that it is important for a listed entity to ensure  that all available information  about the material impact of COVID-19 on the company and its operations is communicated  in a timely and cogent manner to its investors and stakeholders.

Keeping the above in view, Securities and Exchange Board of India (SEBI) vide its circular dated 20 May, 2020 1 has issued an advisory regarding disclosure of material impact of Covid-19 pandemic on listed entities. In this advisory, SEBI has provided an illustrative list of information that listed entities should provide to the Stock Exchanges.

Read MoreReferences
  1. Circular No.: SEBI/HO/CFD/CMD1/CIR/P/2020/84 dated May 20, 2020[↩]
18May
MHA Order dated 17 May 2020: Highlights

Ministry of Home Affairs, Government of India has issued an Order No. 40-3/2020-DM-I(A) dated 17th May, 2020 1 extending lockdown till 31st May, 2020 in view of pandemic Covid-19. In this article, summary of this order dated 17th May 2020 vis a vis MHA order dated 1st May, 2020 is provided for ease of understanding.

MHA17MAY-Order-SummaryDownload

Contributed by: Mr. Gauarav Girdhar, LLM

References
  1. https://www.mha.gov.in/sites/default/files/MHAOrderextension_1752020.pdf[↩]
17May
SEBI Relaxation from Minimum Public Shareholding requirements

During the continuance of Covid-19 pandemic, the regulatory authorities are providing relaxation in the various compliances under different laws to ease the corporates. On the same lines, Securities and Exchange Board of India (SEBI) has issued a circular dated May 14, 2020 1 vide which it has granted relaxation to the effect that no penal action be taken by Stock Exchange against the listed entities who could not meet the requirements of Minimum Public Shareholding (MPS) during the period March 1, 2020 to August 31, 2020.

Regulation 38 of the Listing regulations requires a listed entity to comply with the minimum public shareholding requirements as specified in rule 19(2) and rule 19A of the Securities Contracts (Regulation) Rules, 1957. However, this provision does not apply to entities listed on institutional trading platform without making a public issue.

Read MoreReferences
  1. SEBI circular CFD/CMD/1/CIR/P/2020/81 dated 14 May, 2020 [↩]
15May
NCLT orders to file default record from Information Utility

National Company Law Tribunal (NCLT) vide its order dated 12 May 2020 has directed to Financial Creditors to file record from Information Utility mandatorily alongwith the new petitions being filed under section 7 of Insolvency and Bankruptcy Code, 2016 (IBC). No new petition shall be entertained without record of default u/s 7 of IBC.

Here, it is pertinent to mention that National E-Governance Services Ltd (NeSL), is India’s first and only Information Utility which is registered with the Insolvency and Bankruptcy Board of India (IBBI) under the aegis of the Insolvency and Bankruptcy Code, 2016 (IBC). The primary role of NeSL is to serve as a repository of legal evidence holding the information pertaining to any debt/claim, as submitted by the financial or operational creditor and verified and authenticated by the other parties to the debt.

Henceforth, default record from National E-Governance Services Ltd (NeSL) is mandatorily required to be annexed with all the petitions being filed u/s 7 of IBC.

In the case of petitions already filed u/s 7 of IBC which are pending for admission, NCLT has also directed to the Authorised Representatives/parties in the case to file default record from Information Utility i.e NeSL before next date of hearing.

Reference:
NCLT Order-File No.25/02/2020-NCLT dated 12th May 2020
9May
Compliance Relaxations by SEBI amidst COVID-19

Amidst unprecedented outbreak of pandemic coronavirus (Covid-19), the Securities and Exchange Board of India (SEBI) has granted temporary relaxation to Equity listed entities in relation to compliance with certain deadlines under various provisions of the SEBI regulations. SEBI has granted the said relaxations vide its circulars dated March 19, 2020, March 23, 2020, March 26, 2020, March 27, 2020, and April 13, 2020.

In this article, an effort has been made to consolidate all the above relaxations and present a brief summary stating the due dates and revised due dates in respect of compliances to be done by the Listed Companies whose equity shares are listed on Stock Exchange(s).

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8May
MCA relaxations under the Companies Act, 2013: COVID-19 Impact

Due to outbreak of unprecedented novel coronavirus (COVID – 19) throughout the world including India, lockdowns and unexpected restrictions have been imposed on the public as well on the corporate sector. Companies are likely to face many problems in the timely compliances of various applicable laws. Taking into account the hardships being faced by the companies, Government of India has temporarily relaxed a number of compliances by the companies. Some of the major relaxations given by the Ministry of Corporate Affairs (MCA) under the Companies Act, 2013 are outlined below.

MCA vide its notification dated 19th March, 2020 has dispensed with the need to conduct physical board meetings till 30th June, 2020 in relation to matters which are otherwise matters not permitted to be dealt with through video conferencing or other audio visual means under the Companies Act, 2013 and the rules thereunder, including the approval of the annual financial statements, Board’s report, Prospectus, Audit Committee Meetings for consideration of Financial Statement and approval of the matter relating to amalgamation, merger, demerger, acquisition and takeover. Consequently, such meetings may be held through video conferencing or other audio-visual means from 19th March, 2020 until 30th June, 2020.

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7May
IBC Threshold increased: Implications

Vexatious initiation of insolvency process as arm-twisting tool, merely for recovery of dues has been a cause of concern since long due to low threshold of default of Rs.1 Lakh prescribed under the Insolvency and Bankruptcy Code, 2016 (IBC). While there was long outstanding demand for raising the threshold limit for initiating insolvency process, the notification has come in the wake of recent outbreak of the Coronavirus disease (COVID –19). The minimum default requirement under IBC now stands increased hundred times; from Rs.1 Lakh to Rs. 1 Crore.

Ministry of Corporate Affairs vide notification no. S.O. 1205(E) dated 24 March 2020 1 has amended Section 4 of the Insolvency and Bankruptcy Code, 2016 (IBC) vide which it has raised the threshold of default for filing of an insolvency petition under the Insolvency and Bankruptcy Code, 2016 (IBC) from Rs.1 Lakh to Rs. 1 Crore.

Read MoreReferences
  1. https://ibbi.gov.in//uploads/legalframwork/48bf32150f5d6b30477b74f652964edc.pdf[↩]