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Dear Patrons,
Section 204 of the Companies Act, 2013 requires every listed company and company belonging to other class of companies as may be prescribed to annex with its Board's report, a Secretarial Audit Report, given by a company secretary in practice. Secretarial Audit Report format is prescribed in Form No. MR. 3, wherein Secretarial Auditor is required to examine and report compliance of "other laws as may be applicable specifically to the company".
The author, Prakash Pandya (Practicing Company Secretary, Mumbai), discusses in detail the provisions of Sec. 204. Considering the volume of audit work and responsibility bestowed by Ministry of Corporate Affairs on Company Secretaries, the author asks a question- "Aren't Independent Directors and Company Secretaries sailing in the same boat?"
Considering the implementation issues and confusion over the phrase "other laws as may be applicable specifically to the company", author suggests "Let rein of litigation remain with the Government and not with parties i.e. either Secretarial Auditor or the auditee". He further advises that Secretarial Audit related provisions be implemented in phased manner, whereby companies can assess list of applicable laws, set up proper systems for independent verification.
Click here to read the analytical article titled as "Secretarial Audit's scope – All round confusion"
Best Regards,
LSI Team
Penalises Acquirer for takeover code violation; Interprets 'threshold' vis-à-vis SEBI 2009 circular |
SEBI imposes penalty of Rs. 2 Crores on acquirer & persons acting in concert (collectively referred to as 'noticees') for failing to make public announcement under Reg. 11(2) of SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 1997; Rejects noticees' contention that share acquisition was exempt from public announcement provisions as contemplated by second proviso to Reg. 11(2) as 'overall shareholding' did not cross 75%; Holds that noticees crossed 5% limit in March 2010 itself and thus, current acquisition of 4.79% in multiple tranches does not qualify for exception (as provided in Reg. 11(2) proviso); Refers to SEBI Circular dated August 6, 2009 wherein interpretation of proviso to Reg. 11(2) was clarified, states "the moment 5% shares or voting rights are acquired by an acquirer whose shares or voting rights in the target company is between 55% to 75%, any additional shares or voting rights can be acquired only after making a public announcement"; Relies on SC observations in Swedish Match AB & Anr. Vs SEBI that purport and object of which a regulation is made must be duly fulfilled:SEBI |
| The Order was passed by D. Ravi Kumar, Chief General Manager and Adjudicating Offi |
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