MANGHANMALUDHARAM COLLEGE OF COMMERCE

A PROJECT REPORT ON

COMPANIES ACT, 2013 AND INVESTOR PROTECTION

SUBMITTED TO

SAVITRIBAI PHULE PUNE UNIVERSITY

IN PARTIAL FULFILLMENT OF

BACHELORS OF BUSSINESS ADMINISTRATION

UNDER THE GUIDENCE OF

DR. PALAK CHHABLANI

SUBMITTED BY

MANSI HARESH KESWANI

TY BBA (2023-2024)
 ACKNOWLEDGEMENT

I would like to express my sincere gratitude to everyone who has supported me throughout my
project.

I would extend my Special thanks to our principal Dr. Vinita Basantani of Manghanmal Udharam
College of Commerce and project guide Prof. Dr. Palak Dilip Chablani who gave me guidance and
golden opportunity to do this project, which also helped me in doing a lot of research and I came to
know about so many new things I am really thankful to them.

I am sincerely grateful to bankers for sharing their truthful and illuminating views on a number of
issues related to the project.

At last, but not the least I want to thank my parents and friends who treasured me for my hard work
and encouraged me.

Place: Pimpri

Date: 31-10-2023 Mansi Keswani

 CERTIFICATE

This is to certify that Ms. Mansi Keswani (Roll No.: 280 & Seat No.
) has successfully completed a Project titled Companies Act, 2013 and Investor Protection.
The same constitutes a part of T.Y.B.B.A curriculum for the academic year 2023-2024.

_____________ ___________ ___________

Project Guide Internal Examiner External Examiner

 DECLARATION

I undersigned solemnly declare that the report of the project work, is based my own work carried out
during the course of my study under the supervision of Prof. Dr. Palak Dilip Chablani of Manghanmal
Udharam College of Commerce.

I assert that the statements conclusions drawn are an outcome of the project work. I further declare
that to the best of my knowledge in the project report.
 Index

 Introduction Companies Act,2013

 Overview Of Companies Act,2013
 Types Of Companies
 History Of Companies Act 2013
 Research And Methodology
 Legal Documents : Memorandum of Associations (MOA), Articles of Associations (AOA)
 Importance of preparation of financial statements and its disclosure
 Investor Education and Protection Fund (IEPF) under SEBI Regulations and companies act
2013
 Conclusion
 Bibliography
 Companies Act 2013

Companies Act 2013

 Introduction To CompaniesAct2013
 Overview Of Companies Act,2013
 Meaning And Nature Of A Company
 Characteristics Of A Company
 Types Of Companies
 History Of Companies Act 2013
 Research And Methodology
 Stages in the Formation Of A Company
 Memorandum Of Association
 Objectives Of Memorandum Of Association
 Clauses/ Contents Of Memorandum Of Association.
 Articles Of Association
 Introduction to Companies Act 2013

The Companies Act 2013 is an Act of the Parliament of India on Indian company law which
regulates incorporation of a company, responsibilities of a company, directors, dissolution of a
company.
The 2013 Act is divided into 29chapters containing 470 sections as against 658 Sections in the
Companies Act, 1956 and has 7schedules. However, currently the rear only 484(470-43+57)
sections in this Act. The Act has replaced The Companies Act,1956(in a partial manner) after
receiving the assent of the President of India on 29 August2013.The section 1 of the companies
Act 2013 came into force on 30 August 2013. 98 different sections of the companies Act came into
force on 12 September 2013 with few changes like earlier private companies maximum number of
members were 50 and now it will be 200. A new term of "one-person company" is included in this
act that will be a private company and with only 98 sections of the Act notified. A total of another
183 sections came into force from1 April 2014. The Ministry of Corporate Affairs the rafter
published a Notification for exempting private companies from the ambit of various sections under
the Companies Act.
The 2013 legislation has stipulations for increased responsibilities of corporate executives in the IT
sector, increasing India's safeguards against organized cyber crime by allowing CEO's and CTO's
to be prosecuted in cases of IT failure.
Minister of Corporate Affairs, and introduced The Companies (Amendment) Bill, 2020.
 Overview of Companies Act, 2013

Over a period of time, the old Act of 1956 started becoming outdated. Hence, it became very
necessary to have a flexible law which could face the challenges of changing business
environment.

The Companies Act 2013 being the second generation reforms seeks to reinforce the trust and
confidence of investors in the Indian Corporate Sector in the background of series of frauds
which have occurred in the recent past. The Companies Act, 2013 provides for a new corporate
regulatory framework in the light of new developments taking place at the national and
international level.
 Meaning and Nature of a Company.

The word ‘company’ is derived from the Latin word Companies (Com means ‘with or together ‘and
Panis means ‘Bread’), and it originally referred to an association of persons who took their meals
together. In the leisurely past, merchants took advantage of festive gatherings, to discuss business
matters. In popular parlance, a company denotes an association of likeminded persons formed for the
purpose of carrying on some business or undertaking in the legal sense, a company is an association
of both natural and artificial persons and is incorporated under the existing law of a country. In terms
of the Companies Act, 2013 a “company” means a company incorporated under this Act or under any
previous company law [Section 2 (68)] In common law, a company is a “legal person” or “legal entity”
separate from, and capable of surviving beyond the lives of its members.
 Characteristics Of A Company

 Corporate Personality :A company Incorporate under the Act is vested with a corporate
personality so it bears its own name, acts under name, has a seal of its own and its assets are
separate and distinct from those o fits members. It is a different ‘person’ from the members
who compose it. Therefore it is capable of: owning property, incurring debts, borrowing money,
having a bank account, employing people, entering into contracts and suing or being sued in
the same manner as an individual.
 Company As An Artificial Person: A Company is an artificial person created by law. It is not a
human being but it acts through human beings. It is considered as a legal person who can
enter into contracts, possess properties in its own name, sue and can be sued by others.
 Company Is Not A Citizen: The Company, though a legal person, is not a citizen under the
Citizenship Act, 1955 or the Constitution of India.
 Limited Liability: “The privilege of limited liability for business debts is one of the principal
advantages of doing business under the corporate form of organization.” The company, being
a separate person, is the owner of its assets and bound by its liabilities. The liability of a
member as shareholder extends to the contribution to the capital of the company up to the
nominal value of the shares held and not paid by him.

 Perpetual Succession: An incorporated company never dies, except when it is wound up as

per law. A company, being a separate legal person is unaffected by death or departure of any
member and it remains the same entity, despite total change in the membership. Perpetual
succession means that the membership of a company may keep changing from time to time,
but that shall not affect its continuity.
 Separate Management: The members may derive profits without being burdened with the
management of the company. They do not have effective and intimate control over its working
and the elect their representatives as Directors on the Board of Directors of the company to
conduct corporate functions through managerial personnel employed by them. In other words,
the company is administered and managed by its managerial personnel.
 Transferability of Shares: The Capital of a company is divided into parts, called shares. The
shares are said to be movable property and, subject to certain conditions, freely transferable,
so that no shareholder is permanently or necessarily wedded to a company. Section 44 of the
Companies Act, 2013 enunciates the principle by providing that the shares held by the
members are movable property and can be transferred from one person to another in the
manner provided by the articles.
 Types of Companies

Following are the general type of Companies which can be formed under the
Companies Act, 2013.

 Public Limited Companies

 Private Limited Companies

 One Person Company

 Section 8 Companies

 Producer Companies
 Public Limited Companies

A public limited company’s definition is the answer to the question - What are public
limited companies? Essentially, public limited companies are corporate entities that
are registered under the Indian Companies Act. They have a separate legal identity
and are considered to be distinct from their owners.

This effectively means that a public limited company is recognised by law as a

separate entity from its owners and can enter into agreements under its own name.
While these companies are still owned and run by their owners, they have their own
separate set of rules, obligations, regulations and legal rights.

The owners of a public limited company are termed as the ‘shareholders’ or

‘stakeholders’ of the company. The ownership interest of the entity is split into
multiple units known as ‘shares’ or ‘equity shares.’ These units of ownership are
typically held by multiple individuals or corporations.

Private Limited Companies

A private limited company is any type of business entity in "private" ownership used
in many jurisdictions, in contrast to a publicly listed company, with some differences
from country to country. Almost 93 percent of the companies incorporated in India
are registered as Private Limited Companies.
The Ministry of Corporate Affairs is the governing body which regulates all Private
Limited Companies in India. The main law regulating Private Limited Companies is
the Companies Act 2013. Prior to 2015, the shareholders (known as members) had
to pay a minimum of ₹1 lakh (equivalent to ₹1.3 lakh or US$1,600 in 2020) as a
subscription amount to incorporate a private limited company. A private limited
company can have at most 200 members. A company with one member is referred
to as a One Person Company.
The Companies Act, 2013 is the regulating Act along with the Rules (Delegated
Legislation), Notices, Circulars and Notifications issued by the Ministry of Corporate
Affairs.
 One Person Company

According to Section 2 (62) of the Companies Act, 2013, One Person Company
means a company which has only one person as a member. It is incorporated as a
private company which has only one member. Therefore, a corporation can be
registered even when it only has one shareholder or member.

The Companies Act, 2013 provides that an individual can form a company with one
single member and one director. The director and member can be the same person.

One Person Company in India is a new concept that has been introduced with the
Company's Act 2013. One Person Company in India is incorporated by a single
person. Before the enforcement of the Companies Act 2013 a single person was not
able to establish a company. An OPC has features of a Company and the benefits of
the sole proprietorship. Earlier if a person had to establish a business then he or she
should only opt for a sole proprietorship.

Section 8 Companies

The Companies Act defines a Section 8 company as one whose objectives is

to promote fields of arts, commerce, science, research, education, sports, charity,
social welfare, religion, environment protection, or other similar objectives. These
companies also apply their profits towards the furtherance of their cause and do not
pay any dividend to their members.

These companies were previously defined under Section 25 of Companies Act, 1956
with more or less the same provisions. The new Act has, however, prescribed more
objectives that Section 8 companies can have.

Famous examples of Section 8 companies include Federation of Indian Chambers of

Commerce and Industry (FICCI) and Confederation of Indian Industries (CII).
The objective of these companies is facilitating the growth of trade and commerce and
India.
 Producer Companies

A Producer Company is thus a body corporate having an object that is one or all of
the following: production, harvesting, procurement, grading, pooling, handling,
marketing, selling, and the export of primary produce of the Members or import of
goods or services for their benefit.

A producer company can be defined as a legally recognized body of farmers/

agriculturists with the aim to improve the standard of their living and ensure a good
status of their available support, incomes and profitability.

Stages in the Formation of a Company

Modern-day business requires a large amount of funds. The competition and

change in the technological environment are also increasing day by day. As a
result, the company form of organization is being preferred by more and more
business firms. The steps which are required from the time a business idea
originates to the time a firm is legally ready to commence business are referred to
as stages in the formation of a company. Those who are taking these steps and the
associated risks are promoting a company and are called its promoters.
To fully understand the process we will divide the formalities into four distinct
stages, which are:
1. Promotion
2. Incorporation
3. Subscription of the Capital
4. Commencement of Business

However, it must be noted that these stages are appropriate from the point of view
of the formation of Public Ltd. Company. As far as the Private Ltd. Companies are
concerned only the first two stages mentioned above are appropriate. A Private Co.
can start its business immediately after obtaining the certificate of incorporation as
it is prohibited to raise funds from the public.

 Promotion Stage:

 Promotion is the first stage in the formation of a company. It involves

conceiving a business opportunity and taking the initiative to form a
company so that practical shape can be given to exploiting the available
business opportunity. Apart from conceiving business opportunities the
promoters analyze its prospects and bring together the men, materials,
machinery, managerial abilities, and financial resources and set the
organization going.

Functions of a Promoter:

1. Identification of Business Opportunity

2. Feasible Studies:
 Technical Feasibility
 Financial Feasibility
 Economic Feasibility
3. Name Approval
4. Fixing up Signatories to the Memorandum of Association
5. Appointment of Professionals
6. Preparation of Necessary Documents required to be submitted:

 Memorandum of Association: MOA is the most important document as it

defines the objective of the company. No companies can legally undertake
activities that are not contained in the MOA. The MOA contains different
clauses which are given as follows-
 The Name Clause
 Registered Office Clause
 Objects Clause
 Liability Clause
 Capital Clause
 Association Clause

 Articles of Association: AOA contains the rules regarding the internal

management of the company. A Public Ltd. Co. may adopt Table A which is
a model set of articles given in the companies act. Table A is a document
containing rules and regulations for the internal management of a company.
If a company adopts Table A, there is no need to prepare separate Articles
 of Association.

 Consent of Proposed Directors: Apart from the MOA and AOA, written
consent of each person named as a director is required confirming that they
agree to act in that capacity and undertake to buy and pay for qualification
shares.

 Agreement: The agreement, if any, which the company proposes to, enter
with any individual.

 Statutory Declaration: A declaration stating that all the legal requirements

about registration have been complied with is to be submitted to the
Registrar.

 Payment of Fees: Along with the above-mentioned documents, necessary

fees have to be paid for the registration of the company.
 Incorporation of a Company

After going through the above formalities the promoters of the company make an
application for the Incorporation of the company. The application is to be filed with
the Registrar of the Companies of the state within which they plan to establish the
registered office of the company. The application for registration must be
accompanied by the same certain documents about which we have already
discussed above. These may be briefly mentioned again-

1. Memorandum of Association duly stamped, signed, and witnessed.

2. Article of Association duly stamped, signed, and witnessed.

3. Written Consent of the Proposed Directors

4. Agreement, if any, with the proposed Managing Director, Manager, etc.

5. A copy of the Registrar’s Letter approving the Name of the Company.

6. A Statutory Declaration affirming that all legal requirements of registration have

been submitted.

7. Notice the exact Address of the Registered Office.

8. Documentary evidence of Payment of Fees.

Effect of the Certificate of Incorporation:

A company is legally born on the date printed on the Certificate of Incorporation. It

becomes a legal entity with perpetual succession on such a date. It becomes entitled
to enter into valid contracts. On the date of issue of Certificate of Incorporation, a
private company can immediately commence its business, it can raise necessary
funds through a private arrangement, and proceed to start a business. A Public
Company, however, has to undergo two more stages in its formation.
 Subscription of the Capital

A Public Company can raise the required funds from the public using an issue of
shares and debentures. For this purpose, it has to issue a prospectus which is a kind
of invitation to the public to subscribe to the capital of the company and undergo
various other formalities. The following steps are required for raising funds from the
public-

1. SEBI Approval: Securities and Exchange Board of India which is the regulatory
authority in our country has issued guidelines for the discloser of information and
investor protection. A company inviting funds from the general public must follow
SEBI guidelines of discloser of all the adequate information.

2. Filing of Prospectus: Prospectus is a document that includes any notice, circular,

advertisement, or other documents inviting offers from the public for the subscription.
It has to be filed with the Registrar of Companies.

3. Appointment of Bankers, Brokers, and Underwriters

4. Minimum Subscription: If Applications received for the shares are for an amount
less than 90 percent of the issue size, the allotment cannot be made.

5. Application to Stock Exchange: Application is to be made to at least one stock

exchange for permission to deal its shares or debenture.

6. Allotment of Shares
 Commencement of Business

If the amount of minimum subscription is raised through the new issue of shares, a
public company applies to the Registrar of Companies for the issue of Certificate of
Commencement of Business. The following documents are required:

1. A declaration that shares payable in cash have been subscribed for and allotted.

2. A declaration that every director has paid in cash, the application, and allotment
money on his shares.

3. A declaration that no money is payable or liable to become payable to the

applicants.

4. A statutory declaration that the above requirements have been complied with.
Memorandum of Association

The memorandum of association of a company is an important corporate document

in certain jurisdictions. It is often simply referred to as the memorandum. In the UK, it
has to be filed with the Registrar of Companies during the process of incorporating a
company. It is the document that regulates the company's external affairs,[1] and
complements the articles of association which cover the company's internal
constitution. It contains the fundamental conditions under which the company is
allowed to operate. Until recently it had to include the "objects clause" which let the
shareholders, creditors and those dealing with the company know what is its
permitted range of operation, although this was usually drafted very broadly. It also
shows the company's initial capital. It is one of the documents required to incorporate
a company in India, the United Kingdom, Ireland, Canada, Nigeria,
Nepal, Bangladesh, Pakistan, Afghanistan, Sri Lanka, and Tanzania and is also used
in many of the common law jurisdictions of the Commonwealth. The MOA of a
company contains the object for which the company is formed. It identifies the scope
of its operations and determines the boundaries it cannot cross. It is a public
document according to Section 399 of the Companies Act, 2013.

A Memorandum of Association (Moa) represents the charter of the company. It is a

legal document prepared during the formation and registration process of a company
to define its relationship with shareholders and it specifies the objectives for which
the company has been formed.
 Objectives of Memorandum Of Association

MOA helps the creditors, shareholders and any other person that are interacting and
dealing with the company, to know the company's powers and objectives. In addition
to this, MOA contents help the prospective shareholders in taking the right decision
while investing in the company

A company can undertake only those activities that are mentioned in the MOA. In
other words, the Memorandum of Association lays down the boundary beyond which
the actions of the company cannot exceed.

MOA helps the creditors, shareholders and any other person that are interacting and
dealing with the company, to know the company’s powers and objectives. In addition
to this, MOA contents help the prospective shareholders in taking the right decision
while investing in the company.
 Contents/ Clauses of Memorandum of Association

The Memorandum of Association is a constitutional document of the company that

helps to bring change in a business activity. It consists of five clauses as listed
below:

1. Name clause– It provides the name of the company. From the name of the
company, one can come to know whether it is private or public limited
company.

2. Registered office clause– It shows in which state the company is

incorporated.

3. Object clause– From the object clause, it shows the purpose of the company.

4. Liability clause– It shows the liability of the members of the company. It can
be limited by shares or guarantee.

5. Capital clause– Companies having share capital will show the total
authorized capital which is divided into the number of shares and the amount.

6. Nominee clause– Nominee clause applicable only in case of One Person

Company. In this clause mention name of individual who will become member
of company in event of subscriber death. Subscriber and nominee must be
Indian citizen and resident of India.

Hence the company has to follow the procedure as specified under law to change
the business activity in of a company. For this, the company will require the approval
from the shareholders by passing a resolution.
l

Importance of preparation of financial statements and its disclosure

Financial statements are like a report card for a business, summarizing its financial
performance and position over a specific period. They consist of the income
statement, balance sheet, statement of cash flows, and statement of changes in
equity. Let's break down the importance of preparing these statements and ensuring
proper disclosure:

1. Transparency and Accountability:

 Financial statements provide transparency into a company's financial

health. This transparency is crucial for building trust among investors,
creditors, and other stakeholders.

 They hold the company accountable for its financial activities and
performance.

2. Decision-Making:

 Investors and creditors use financial statements to make informed

decisions about investing or lending money to a company.
  Management relies on these statements for strategic planning and
decision-making, helping them understand which areas of the business
need improvement.

3. Compliance:

 Publicly traded companies are required by law to prepare and disclose

financial statements regularly. This ensures compliance with regulatory
standards and helps prevent fraud and mismanagement.

4. Creditworthiness:

 Lenders use financial statements to assess a company's

creditworthiness. A strong financial position increases the likelihood of
obtaining credit on favorable terms.

5. Valuation of the Business:

 Investors often use financial statements to determine the value of a

business. This is crucial for mergers and acquisitions, as well as for
buying and selling stocks.

6. Performance Evaluation:

 Financial statements help evaluate a company's performance over

time. By comparing statements from different periods, stakeholders can
identify trends, strengths, and weaknesses.

7. Disclosure Requirements:

 Proper disclosure is essential for providing additional information that

might impact the interpretation of financial statements. This includes
details about accounting policies, contingent liabilities, and related-
party transactions.
 8. Stakeholder Communication:

 Financial statements serve as a communication tool between the

company and its stakeholders. Clear and comprehensive statements
help stakeholders understand the company's financial story.

9. Legal Compliance:

 Adherence to accounting standards and disclosure requirements

ensures that the company is in compliance with legal regulations. This
reduces the risk of legal action and financial penalties.

In summary, the preparation of financial statements and their disclosure is not just a
legal requirement but a fundamental practice for maintaining trust, making informed
decisions, and ensuring the long-term sustainability of a business.
 Articles of Association

What do you mean by articles of association?

Articles of association form a document that specifies the regulations for a
company's operations and defines the company's purpose. The document lays out
how tasks are to be accomplished within the organization, including the process for
appointing directors and the handling of financial records.
A company's Articles of Association (AOA) is a primary declaration of the company's
nature, purpose and ends which, along with the Memorandum of Association, forms
together the company's constitution. These must be submitted at the time of
application for incorporation. The Articles of Association (AoA) is the
charter document that establishes the legal existence of a company in many
jurisdictions worldwide, including the United Kingdom, Europe, and China. This
regulatory document defines the purpose of a company and its operation. Regulatory
authorities determine the minimum requirement for its content, also known as
articles, for establishing companies within their jurisdiction. Although this is the
baseline to conduct commercial activity as a separate legal entity, companies can
expand beyond to suit the circumstance.
History of Companies Act 2013

The Act consolidates and amends the law relating to companies. The Companies
Act, 2013 has been notified in the Official Gazette on 30th August, 2013. Some of
the provisions of the Act have been implemented by a notification published on 12th
September, 2013. The provisions of Companies Act, 1956 is still in force.

The Companies Act 1956 was enacted on the recommendations of the Bhaba
Committee set up in 1950 with the object to consolidate the existing corporate laws
and to provide a new basis for corporate operation in independent India. With
enactment of this legislation in 1956, the Companies Act 1913 was repealed.

The Companies Act 2013 was introduced to improve corporate governance and
ease the process of doing business in India by providing business-friendly corporate
regulation.

The main purpose of the Companies Act 1956 is to legislate the functioning,
financing, formation and dissolution of companies.
 Research and Methodology

Business research is process of acquiring detailed information of all the areas of

business and using such information in maximizing the sales and profit of the
business. Such a study helps companies determine which product/service is most
profitable or in demand. In simple words, it can be stated as the acquisition of
information or knowledge for professional or commercial purpose to determine
opportunities and goals for a business.

Business research can be done for anything and everything. In general, when people
speak about business research it means asking research questions to know where
the money can be spent to increase sales, profits or market share. Such research is
critical to make wise and informed decisions.

LEGAL DOCUMENTS REQUIRED FOR MEMORANDUM OF ASSOCIATIONS

When diving into the world of Memorandum of Association (MOA), you'll want to
include some key elements to ensure your company's foundation is solid. Here's a
checklist:

1. Name Clause: Clearly state the name of the company.

2. Registered Office Clause: Specify the location of the registered office. This is
the official address of the company.

3. Object Clause: Outline the main objectives for which the company is formed.
This is like the superhero mission statement.

4. Liability Clause: Define the liability of members—whether it's limited or

unlimited.

5. Capital Clause: Detail the authorized capital of the company. This is the
maximum amount of share capital that the company is authorized to issue.
 6. Association Clause: Confirm the desire of the subscribers to form a company
and their intention to be formed into a company.

The MOA is essentially the company's identity card, stating who it is, where it lives,
and what it aims to achieve. Got any specific questions about any of these clauses?

LEGAL DOCUMENTS REQUIRED FOR The Articles of Association (AOA)

This document focuses on the internal rules and regulations that govern the
management of a company. Here's what you need to include:

1. Preliminary Clause: Acknowledge the adoption of the Articles of Association.

2. Share Capital Clause: Specify the types of shares, their rights, and the
conditions for issuing and transferring them.

3. Table A (if applicable): This is a set of model articles provided by company

law. You can either adopt it in full or modify it to suit your company's needs.

4. Directors' Powers Clause: Detail the powers and responsibilities of the

directors. Think of it as their job description.

5. General Meetings Clause: Lay out the rules for calling and conducting
meetings of shareholders. Democracy in action!

6. Voting Rights Clause: Explain the voting rights of shareholders. Who gets how
many votes?

7. Dividends Clause: Outline the rules for declaring and paying dividends. Show
me the money!

8. Winding Up Clause: Specify the procedures for winding up the company.

Every story has an ending, right?

These documents are like the constitution and laws of your company, ensuring that
everyone plays by the rules. Need any more info on these or planning to draft one
yourself?
 Data Analysis of Companies Act 2013

The Companies Bill, 2012 was passed in Rajya Sabha on 8th August, 2013,
and became Companies Act, 2013 finally replacing the decades old
Companies Act, 1956 which was a very much outdated legislation guiding
companies in India. The statute contains 29 chapters, 470sections and 7
schedules, which is comparatively more streamline the Companies Act, 1956
which contained 658 sections and14 schedules. The phrase “as may be
prescribed” has been used around 336 times in the 2013 Act which gives the
Central Government ample power to fine-tune the workings of the Act to the
continuous economic changes that plague the present world. However,
probably the main aim of the Companies Act, 2013 has been to reduce the
bureaucratic red tape and bring down the continuous hurdles that businesses
and start-ups face when and after incorporating themselves into a company.
The Companies Act, 2013 aims at lessening Government approvals and
boosting self-regulations by companies so as to provide for speedy workings by
companies and to enable them to be competitive players in the world economy.
However with rising concerns about scams and tax-fraud by company
directors, the Company Act 2013 has redefined the term “financial year” and
the Listing Agreement makes it mandatory for listed companies to publish its
consolidated accounts which are neither required to be filed before the AGM or
put before the Registrar of Companies. Although these have been the golden
aims of the Government, it can be said that the Companies Act, 2013 has
brought in a mixed basket of results with some successes and some failures.
The following pages shall traverse all the fundamental aspects of the two Acts
so as to compare and analyze the main different aspects.
 Conclusion

The Companies Act, 2013 has taken a great initiative in establishing good corporate
governance in India. Various changes have been introduced through the said Act for
establishing transparency, accountability and independence in the operations of a
company. The Companies Act 1956 was enacted on the recommendations of the
Bhaba Committee set up in 1950 with the object to consolidate the existing corporate
laws and to provide a new basis for corporate operation in independent India. With
enactment of this legislation in 1956, The Companies Act 1913 was repealed.

The Companies Act 2013 is an Act of the Parliament of India on Indian company law
which regulates incorporation of a company, responsibilities of a company, directors,
dissolution of a company.

INVESTOR EDUCATION AND PROTECTION FUND UNDER SEBI REGULATIONS

AND COMPANIES ACT, 2013

Sure, let's dive into the world of investor education and protection funds! The
Investor Education and Protection Fund (IEPF) is a significant initiative under both
SEBI regulations and the Companies Act, 2013 in India. The main aim is to
safeguard the interests of investors and promote investor education.

Under the Companies Act, 2013, companies are required to transfer unpaid or
unclaimed dividends, matured deposits, and other assets to the IEPF. These funds
are utilized for the promotion of investor education, awareness, and protection
activities.

SEBI, the Securities and Exchange Board of India, also plays a role in investor
protection. SEBI regulations mandate companies to contribute a certain percentage
of their profits to the Investor Protection and Education Fund (IPEF), managed by
SEBI. This fund is used for various activities to educate and protect investors.

The idea behind both these funds is to empower investors with knowledge, ensure
the safety of their investments, and create a culture of responsible investing. It's like
having a financial safety net for investors, promoting transparency and accountability
in the corporate world.
1. Investor Education and Protection Fund (IEPF) under SEBI Regulations:

The SEBI (Investor Education and Protection Fund) Regulations, 2009, provide the
framework for the administration and utilization of the Investor Education and
Protection Fund.

Key points may include:

 Objective: The main purpose of the fund is to promote investor education,

awareness, and protection.

 Contribution: Companies are required to contribute a certain percentage of

their profits to the IEPF.

 Utilization: The funds collected are utilized for activities related to investor
education and protection.

2. Companies Act, 2013:

Under the Companies Act, 2013, the IEPF is primarily governed by Section 125 and
related rules.

Key points may include:

 Transfer of Unclaimed Dividends: Any unclaimed or unpaid dividends are

required to be transferred to the IEPF after a specified period.

 Transfer of Shares: Shares and other securities that are unclaimed for a
continuous period of seven years are also transferred to the IEPF.

 Refund of Shares: Shareholders can claim their shares from the IEPF by
following the prescribed procedures.

3. Unclaimed Dividends and Shares:

One of the significant roles of the IEPF is to receive unclaimed dividends and shares
and make refunds to the rightful claimants.

4. Role of SEBI:

SEBI, being the regulator for the securities market in India, plays a supervisory role
in ensuring compliance with the regulations related to the IEPF.

Please note that regulatory frameworks can be subject to amendments, and it's
crucial to refer to the latest updates from SEBI and the Ministry of Corporate Affairs
for the most current information. You may also want to consult legal professionals or
official government publications for the latest details on the Investor Education and
Protection Fund.
 Bibliography

 www.google.org.com

 https://en.wikipedia.org/wiki/Companies_Act_2013
 https://e-book.icsi.edu/
 https://www.india.gov.in/companies-act-2013
THANK-YOU