National University of Study and Research in

Law, Ranchi
Course Outline

Course Title:Company Law

Semester: VI
Name of Teacher: Dr. Koushik Bagchi

COURSE DESCRIPTION

The course titled Company Laws aims to acquaint the students with the basic
principles of incorporation and the legal requirements for raising capital of listed
public companies. The course shall also aim at equipping the students with the
basic principles of 'company law' including the Companies Act, 2013 relating to
Primary market, Secondary Market & SEBI Intermediaries.and the various other
regulatory mechanisms under the enactment to control corporate frauds.

Students should also keep in mind that the Regulatory regime of companies all over
the world is undergoing major policy changes. The Indian Corporate regulatory
system is also not an exception. The J.J. Irani Committee had proposed significant and
major policy shift in the Indian Corporate Regulatory regime. The enactment of
the Companies Act, 2015 has been a significant development in the subject. The
students shall be updated with the latest developments in the field with the
recommendations made by the Uday Kotak Committee and the subsequent
amendment to the Act.

This course will be taught through case method with basic concepts, empirical research,
class discussion and group discussion after prior reading of cases/articles is a primary mode
of teaching/learning. Empirical research projects outcome presentation to the public via
print and electronic media. Class Presentation on various aspects of the Company Actr
shall be designed im the modules to develop critical and analytical thinking on the subject.
COURSE OBJECTIVE(S)

The object of the course is to familiarize the students with the various procedures for
incorporating a company, and to aquient the students to resolve the various issues involved
in share markets and various frauds in the share market and understand the various
remedies available through various legal forums in addressing their grevances. Give the
students an idea of other allied laws and regulatory mechanisms available in India to

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address the problems associated to Company Law
EVALUATION PATTERN
Mid-term examination: 20 marks
Internal Assessment : 30 marks
End-term examination: 50 marks
BASIC READINGS

1. Ramaiya, Guide to Companies Act (Wadhwa, Napur, 2014 ed.)

2. Davis Paul. L, Gower's Principles of Modern Company Law (Sweet
&Maxwell, London, Ed. 6 th 2003)
3. SN Shah. Lecture on Company Law, (Eastern Law Book House. Calcutta.
1994)
4. Majumdar: Company Law (Taxman, New Delhi 2005)
5. Sen S.C. The New Frontiers of Company Law (Eastern Law House, Calcutta,
ed. 1' 1973)
6. Bearle & Means: The Modern Corporation and Private, (1987)
7. Alan Dignam, Company Law Oxford University Press 9 thEdn. (2016)
8. Reinier Kraakmanet al. The Anatomy of Corporate Law: A Comparative &
Financial Approach Oxford University Press (2017)
9. Avtar Singh Company Law Eastern Book Company 17 thEdn. (2018)
10. D. S. Chopra & Nishant Arora Company Law: Piercing the Corporate Veil Eastern
Law House (2013)

WEEK 1– The Corporate Legal System

A. Fundamentals of corporate legal system

· Origin and developments of Company Law in India and in other
jurisdictions
· Major legislations applicable to companies
· Current Issues Relating to company law.
B. Consequences of Formation
· Corporation: A Separate Personality
· Lifting and piercing of corporate veil
· Kinds of Companies

Readings:
1. Y.V. Ruiav. Dahnia.S. (1968)38 Corn. Cases 572.

2. Badri Prasad v. Nagammal, AIR 1959 SC 559.

2. De Beers Consolidated Mines Ltd. V. Howe (1906) AC 555,

3. Tata Eng. & Locomotive Co. Ltd V. State of Bihar. AIR 1965 SC 40.
7. Bennett Coleman & Co. v. Union of India, AIR 1973 SC 10.6.
8. Needle Industries (India) ltd. V. N.I. Newey (India) Holding Ltd 51 Corn. Cases 743.

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 9. Jennings- v. Hammond (1882)1Q BD 225.
10. Salomon v. Salomon (1897) AC 22,
11. Lee v. Lee's Air Farming Ltd. (1960) All Er 420,
12. State Trading Corporation v. CTO (1963). 33 Comp. Cases 1057
13. Kondoli Tea Co. Ltd. Re (1886) I LR 13 Cal 43,
14. Western Coal Field Ltd. V. Special Area Development Authority, AIR 1982 SC 697.
15. Workmen v. Associated Rubber Industry, (1986) 59 Com. Cases 134,
16. Dhulia Amalner MT v. RaychandRupsiDharamsi., AIR 1952 Born. 337.
17. Bacha F. Guzdar v. CIT AIR 1955 SC 74,
18. Macaura v. Northern Assurance e Co. (1925) AC 619 (H L),
19. Daimler Co. Ltd. v. Continental Rubber Co. (Great Britain) 1916 SC 307.
20. Sir DinshawManeckjee Petit, Re AIR 1927 Born 371,
21. CIT v. Sri Minakshi Mills AIR 1967 SC 819.
22. Gilford Motor Co. v. Home (1933) Ch. 935 (CA),
23. Delhi Development Authority v. Skipper Construction Co. Ltd., AIR 1996 SC 2005.
24. Som Prokash Rekhi v. Union of India (1981) 51 Corn Cases 71.
25. State of U.P. v. Renusagar Power Co. AIR 1983 SC 1737
26. New Horizons Lid V. Union of India (1995) 1 SCC 478.
27. Creasey v. Breachwood Motors Ltd. (199.31-BCLC 480 (QBD)
28. Introductions V. City Wall Properties Ltd, (1962)2 All ER 674,
29. Cotman v. Brougham (1918) AC 514

1.

WEEK 2– E-Commerce Business Models( 4 hours)

 E-commerce Business Models

- Major Business-to-Consumer (B2C) Business Models
- Major Business-to-Business (B2B) Business Models
- How E-commerce Changes Business: Strategy, Structure, and Process
Readings-
1. Erlanger v. New Sombrero Phosphate Co. (1878) LR App. Cas. 1278.
2. English and colonial Produce Co. Re (1906) 2 Ch. 435,
3. Natal Land and Colonization Co. v. Pauline Colliery Syndicate 1904 AC 120,
4. Ramkumar Potdar v. Sholopur Spinning and Weaving Co. AIR 1934 Born 427.
5. Jai Narayan Parasrampuria v.Pushpa Devi Saraf &Ors. (2006) 7 SCC 756

WEEK 3– Formation procedure

· Choice of type
· Statutory requirement and nomenclature
Memorandum of association
· Doctrine of Ultra Vires
Article of association
· Doctrine of Indoor Management & Rule of Constructive Notice

Readings:

1. Eying v. Buttercup Margarine Ltd (1917) 2 Ch. I

2. Society of Motor Manufacturers and trader Ltd. V. Motor Manufacturers and

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 Traders Mutual Insurance Co. Ltd. (1925) 1 Ch. 675.
3. Maihati Tea Syndicate Ltd. V. Revenue Officer (1973) 43 Corn Cases 337.
4. Pramod Kumar Mittal v. Southern Steels Ltd. (1980) 50 Corn Cases 555 (Cal.)
5. In Re, Egyptian Saltand Soda Co., AIR 1931 PC 1$2,
6. In Re Ganesh Blinn Tea Co. Ltd. (1964) Com. Cases 556,
7. In re, is Cement (Bharat) Ltd. (1964)b 34 Corn. Cases 729.
8. Re Akola Electric Supply Col. (1962) 32 Com Cases 215,
9. In re, United Colliers Ltd.. (1975) 45 Corn Cases 226,
10. In re, Ganeshben Tea Co. Ltd. (1964) Corn Cases 556.
11. Turner Morison and Co. Ltd. V. Hugen Ford Investment Trust Ltd. (1972) 1 SCC 857.
12. Shyamchand Nandi v. Calcutta Stock Exchange AIR 1949 Cal 337
13. Leann Tea Co. Ltd v P.K. Sarkar (1989TSUpp. 2 SCC 656
14. Greenlaghe v. Ardene Cinema (1950) 2 All ER 1120 (CA),
15. Mathrubhumi Printing and Publishing Co. Lid.v. Vardhantan Publishers Ltd. (1192)
73 Corn cases 80,
16. Shuttleworth v. Cox Bros. &Co. (1927) 2 KB 9,

17. Chidambarain v. Krishna LengarILR 33 Mad 66.

18. Clements v. Clements (1976) 2 ALL ER 268..
19. Bushell v. Faith (1969) 1 All ER 445
20. Southern Foundries Ltd. V. Shirlaw (1940) 2 All ER 445.

21. Borland's Trustee v. Steel Brothers and Co. Ltd..(1901) 1 Ch. 279.
21. Royal British Bank v. Turquand (1856) 619 ER 886, Morris v. Kansen (1946)1 All ER 586,
22. In re,kamalDistillery Co. AIR 1966 Punj. 655,
23. Lokshmi Ration Lai Cotton Mills v. XK Jute Mills Co. AIR 1957 All ER 311,
24. Houghton & Co. v. Nothard Lowe & Wills Ltd (1927) 1 KB 246,
25. P. V. Damodara Reddy v. Indian National Agencies AIR 1946 Mad 35.
22. A.Lakshmanaswainy Mudaliar v. Life Insurance Corporation of India, AIR 1963 SC 1185,
23. Ashbury Railway Carriage and Iron Co. Ltd. V. Riche (1875) 44 1..1 185.

WEEK 4– Commencement of Business

In general -Public Company
Prospectus
Statement in lieu of prospectus
Readings:
1. Union of India v. Allied International. Products (1971) 41 Corn Cases 127.
2. Derry v. Peek (1889) 14AC 337,
3. New Brunswick Co. v. Muggeridge (I 860) 3 LT 651,
4. Progressive Aluminum Ltd. V. Registrar of Companies (1997) 89 Corn Cases 147,
5. Kisan Mehta v. Universal Luggage Manufacturing Co. (1988) 63 Corn Cases 398,
6. Delhi Cloth & General Mills Ltd. v. Union AIR 1983 SC 937,
7. MadhubaiAmthalal Gandhi v. Union of India AIR 1961 SC 21.
8. Rachna Flour Mills Pvt.. Ltd. V. Lalchand (1987) 62 Comp. Cases 15.
9. Ritesh Agarwal v. SEBI (2008) 8 SCC 205

WEEK 5– Capital Instruments

· Share capital

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· Types of share capital
· Increase of capital
· Reduction of capital
· Shares
· Acquisition of own shares
· Dematerialized shares and transmission
· Transfer of shares
· Dividend and distribution

Readings:

1. Bajaj Auto Ltd. V. N.K. Firodia (197I) 41 Corn Cases 1,

2. Gammon India ltd. V. Hongkong Bank and others (1992)7 CLA 124,
3. Kinetic Engineering Ltd. V. Sadhna 74 Corn Cases 82,
4. Vasudev v. PranlalAIR 1974 SC 1728,
5. LIC v. Escorts (1986)1 SCC 264,
6. B.K. Holding Ltd. V. Prem Chanel Jute Mills (1983) 53 Corn Cases 367,
7. Howrah Trading Co. Ltd. V. CIT 1959 SC 775,
8. Killick Nixon Ltd. V. Dhanraj Mills (1983) 54 Corn. Cases 432,
9. Vinzal K. Gupta and Others v. Auto Lamps Ltd. (1996)86 Cony Cases 157,
10. Re Smith and Fawcett Ltd. 1942 Ch. 304.
11. Mrs. Farhat Sheikh v. EsemenMetalo Chemical Pvt. Ltd.- MAN UIC L/0023/1996,
12. Al- Amin Seatrans Ltd. I. Owners and Peru Interectech' in Vessel M )-iyal Bird MANU/
WB/0028/1995.
13. SEBI v. Vision Organics Ltd. MANU/SB/0065/2006,
SEBI v. PhilodenAgro Chem Pvt. Ltd. MANU/SB/0060/2006

WEEK 6– Borrowing

· Debentures and bonds

· Convertible Debenture Instrument
· Types of bond Instruments
· Deposits
· Debenture trustee
· Charges and mortgage

Readings:

1. Prag Tools Ltd. V. Official Liquidator (1984) 56 COM. Cases 961

2. Kerala, Finance Corps. V. C.K.S. Pakcker(1978) Tax LIZ 1850
3. Standard Chartered Bank Ltd. V. Walker (1982) 3 All ER 938,
4. Evans v. Rival Granite Quarries Ltd. (1910) 2 KB 979 (CA),
5. Union of India v. Coorg Estates-Ltd. (1963) 2 COM. L.J. 164,
6. State Bank of India v. Viswaniryat (P) Ltd. (1987) 3 Com. L.J 1

7. WEEK 7– Corporate Management

Member And Shareholder Of The Company
 Introduction
 Process of acquiring the membership of the company

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  Shareholder's role in the management of company- a myth
 Functions and authorities of the shareholder
 Concept of shareholder democracy- arguments for/against

Cases:
1. In re Metal Constituent Company, (1902) 1 Ch Div 707
2. Pallani Appa v. Official Liquidator, Pashupati Bank Ltd, (1942) Co. Cases 470
3. Morgan v. Grey, (1953) All ER 213
4. B. Gupta v. Swadeshi Polytext Ltd., (1985) 58 Co. Cases 563
5. BSN (UK) Ltd v. Janardan Mohan Das Rajan Pihai, (1996).86 Co. Cases 371
6. All Indian Bank Officers Confederation v. Dhanlaxmi Bank Ltd, (1997) 90 Co. Cases 2

WEEK 8– Shareholder Meeting, Voting And Control Over The Management

 Meetings
 Kinds of meetings
 Statutory general meeting
 Extraordinary general meeting
 Minutes of the meeting
Quorum and Voting Requirements
 Chairman of the meeting (Appointment, power and function)
 Shareholders' entitlement to vote and Shareholders' Agreement
 Quorum requirement
 Proxy voting
 Form of proxy
 Revocation of proxy
 Registration of resolution and agreements
 Enforceability of voting rights

Case law:
1. Shree Minakshi Mills Co Ltd. v. Asst. ROC, AIR 1938 Mad 640
2. In re. Asia Udyog Pvt Ltd. (1961) 31 Co. Cases 269
3. P.S. Chettiar and Co. v. The Registrar, (1966) 1 C.D. 17
4. M.P. Mudhra v. Asst. ROC, (1980) 50 Co. Cases 346
5. ROC v. Cabral and Co. Pvt Ltd and others, (1988) 63 Co. Cases 126
6. In re. Maknam Investment Ltd, (1996) 87 Co. Cases 68
7. Vijay M. Porwal v. PentokeyOrgany (India) Ltd. [1996] 87 ComCas 331 (CLB NR)
8. Gates Corporation v. Anand Gates (India) Pvt. Ltd. [1999] 22 SCL 76 (CLB New
Delhi)
9. Somalingappa Shiva PutrappaMugabasavVs.Shree Renuka Sugars Ltd [2002]110
CompCas 371(Kar)
10. B. Ramchandra Adityan v. TamilNadu Mercantile Bank Shareholders Welfare
Association (2010)1 CompLJ 515(Mad), 2009(5)CTC727.

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WEEK 9– Corporate Governance

Board of Directors
· Definition of Directors
· Qualification of Directors
· Type of directors
· Appointment of first director
· Appointment of BODs
· Appointment of Managing Director
· Duties and liability of Director
· Legal position of director
· Removal and resignation of the director
· Term of office
· Restructuring the BOD
· Restriction of the power of the board
· Political contribution
· OCED Guidelines on Corporate Social Responsibility(Corporate
Governance)
· SEBI Listing Obligations and Disclosure Regulations, 2015

Cases:
1. Madhavan Nambiar v. RoC [2002] 108 ComCas 1 (Mad)
2. G. S. Mayawala&Ors. V. Motion Pictures Association [2006] 132CompCas
388(Delhi)
3. Cardamom Marketing (Travancore) Ltd. v. N. Krishna Iyer [1982] 52 ComCas 299
4. P. Natarajan v. Central Government [2004] 60 CLA (Mad); 51 SCL 76 (Mad)
5. Cyrus Investments Ltd. &Ors. v. Tata Sons Ltd. &Ors. (NCLT order dated
12.07.2018)

WEEK 10–Prevention of Oppression and Mismanagement

 Meaning of Oppression
 Meaning of Mismanagement
 Protection against Oppression and Mismanagement
 Shareholders’ Derivative Action
 Investigation powers of NCLT

Cases:
1. Foss v. Harbottle (1964) Camb.LJ 39; (1843) 2 Hare 461
2. In re. Five Minute Car Wash Service, (1956) 1 All ER 242
3. Shanti Prasad fain v. Kalinga Tubes AIR 1965 SC 1535
4. O.P. Gupta v. Shiv General Finance Ltd, (1977) 47 Co. Cases 277
5. Binod Kumar Aggarwal v. Ringtone P Co. Pvt Ltd., (1996) 85 Co. Cases 289
6. ICICI Ltd. v. Parasrampuria Synthetics Ltd. [1998] 92 Comp. Cas. 238/17 SCL
7. K N Sankarnarayanan v. Shree Consultation & Service P. Ltd. (Mad) (1994) 80
ComCas 558
8. S. Seetharaman v. Stick Fast Chemicals P. Ltd. [1998] 93 CompCas 507
9. Needle Ind. (India) Ltd. v. Needle Ind. (NI) Holding Ltd. [1981] 51 CompCas 743 (SC)
10. Amalgamations Limited &Ors. V. Shankar Sundaram &Ors. (2012) 1 CompLJ 568
(Mad)

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 11. Hari Sankaran Vs. Union of India & Others [Civil Appeal No. 3747 of 2019
. Cyrus Investments Ltd. &Ors. v. Tata Sons Ltd. &Ors. (NCLT order dated 12.07.2018) & Supreme
Court Judgment

WEEK 11– Majority Power and Minority Rights

· Power of majority
· The principle of non interference (rule in Foss v. Harbottle)
· Exception to the rule (rule in Foss v. Harbottle)
· Protection of Minority Rights
Case law:
1. Foss v. Harbottle, (1843) 2 Hare 461
2. Esburry Carriers Co. v. Riche, (1875) LK 7 YIL 653
3. Rajmandari Electronic Supply Corporation V. Nadeshwar Rao, AIR 1956 SC 213
4. In re. Pashari Floor Mills Ltd, (1962) 32 Co. Cases 896
5. N.Jaggan v. Investment Trust of India Ltd, (1996) 8 SCL 98
6. Needle Ind. (India) Ltd. v. Needle Ind. (NI) Holding Ltd. [1981] 51 CompCas 743
(SC)

WEEK 12– Corporate Reconstruction

 Corporate Insolvency
 Reconstruction
 Amalgamation
 Takeover Code
 Demerger

Case law:
1. In re. Bugle Press Ltd., (1961) I Ch 270
2. In re. NFU Development Trust Ltd., (1973) All ER 135
3. In re. Helleric and General Trust Ltd., (1976) 1 WLR 123
4. In re. Sharp Industries Ltd. [2005] 123 CompCas 60 (Bom)
5. In re. Larsen & Toubro Ltd., [2004] 60 CLA 55
6. Sesa Industries Ltd. v. Krishna Bajaj &Ors. AIR 2011 SC 1070
7. Khaitan Electricals (Before SEBI – Dt. Of Order 31st Dec. 2012)
8. In re. JuggilalKamplapat Holding Ltd. (2006) 132 Comp. Cas 237 (All.)
9. Ashwin S. Mehta &Anr. V. Union of India (2012)1CompLJ140(SC)
10. Clariant International Ltd. &Anr. V. SEBI AIR 2004 SC 4236
11. Kesha Appliances Pvt. Ltd. v. Royal Holding Services Ltd. [2006] 130 CompCas
227 (Bom)
12. In re. HCL Hewlett Packard Ltd. [1994]80CompCas228(Delhi)
13. Nirma Industries Limited case (2008)
14. Sahara India Real Estate Corporation Ltd. &Ors. V. SEBI &Anr. [2012] 174
CompCas 154 (SC)
15. Vodafone Int. Holdings B. V. v. UOI &Anr. [2012] 170 CompCas 369 (SC)
16. The Chairman, SEBI v. Shriram Mutual Fund &Anr. AIR 2006 SC 2287
17. IPCL (SEBI Judgment dated 10th April, 2013)
18. Binod Kumar v. State of Jharkhand &Ors. (2011)3SCC(Cri)217

WEEK-13 Corporate Death

 Types of Winding Up

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  Winding Up by Court
 Voluntary Winding Up
Readings-
1. In re. Pervil Gold Mines, (1898) 1 Ch 122
2. State of Madras v. Madras Electric Tramway Ltd, Air 1956 Mad 131
3. State Trading Corporation India Ltd. v. Punjab Tannaries Ltd, (1989) 66- Co.Cases
634
4. Kedia Industries Ltd. v. Star Chemical Ltd (1999) 98 Co. Cases 233
5. Nepa Ltd. v. Jnanmandal Ltd. [2001] 107 CompCas 240 (All)
6. Madison Communications Pvt. Ltd. v. Som Distilleries & Breweries Ltd. [2004] 56
SCL 443( Del).
7. In re. German Date Co. [1882]20 ChD169
8. In re. Yenidje Tobacco Co. Ltd. (1916) 2 Ch 426
9. K T Mathew v. Malabar Ind. Co. Ltd. [1986] 59 ComCas 969
10. In re. Mafatlal Industries Ltd. [1995]84CompCas230(Guj)
11. Tata Iron & Steel Co. v. Micro Forge (India) Ltd. [2001]104 CompCas 533(Guj)

WEEK-14 Corporate Death

 Types of Winding Up
 Winding Up by Court
 Voluntary Winding Up

12. In re. Pervil Gold Mines, (1898) 1 Ch 122

13. State of Madras v. Madras Electric Tramway Ltd, Air 1956 Mad 131
14. State Trading Corporation India Ltd. v. Punjab Tannaries Ltd, (1989) 66-
Co.Cases 634
15. Kedia Industries Ltd. v. Star Chemical Ltd (1999) 98 Co. Cases 233
16. Nepa Ltd. v. Jnanmandal Ltd. [2001] 107 CompCas 240 (All)
17. Madison Communications Pvt. Ltd. v. Som Distilleries & Breweries Ltd. [2004] 56
SCL 443( Del).
18. In re. German Date Co. [1882]20 ChD169
19. In re. Yenidje Tobacco Co. Ltd. (1916) 2 Ch 426
20. K T Mathew v. Malabar Ind. Co. Ltd. [1986] 59 ComCas 969
21. In re. Mafatlal Industries Ltd. [1995]84CompCas230(Guj)
22. Tata Iron & Steel Co. v. Micro Forge (India) Ltd. [2001]104 CompCas 533(Guj)
WEEK-15 Organisation and Management of SEBI
Formation of SEBI
Function of SEBI
SEBI Guidelines for issue of securities
Control over intermediaries
Control of SEBI over other market players
WEEK—16 Regulatory Authorities:

 Registrar of Companies
 NCLT
 NCLAT
 SFIO
 Ministry of Corporate Affairs

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 Project Guidelines

The normal length of the project must be 4000 words, excluding the bibliography and table of contents
and must be submitted in both hard and soft copies.
(A4 size paper-one side type-12font size-one and half space).

General Instructions

1. The students are advised to read prescribed books along with legislations and cases.
2. The topics and cases given above are not exhaustive. The teacher teaching the course shall be at liberty to
add new topics/cases.
3. The students are required to study the legislations as amended up-to-date and refer the latest editions of
books.

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