The jurisdiction of CLB has been again extended to also include cases pertaining to rectification of register of members on matters other than transfer or transmission pursuant to section 59 of the new Companies Act
A revamp of Companies Act, 1956 (the Act, 1956) had been in the making for a long time and finally saw the light of the day with Companies Act, 2013 (the Act, 2013). With the use of the word ‘prescribed’ 416 times, it was obvious that a major part of the Act, 2013 was to be enforced by way of rules. However, on 12 September 2013, the Ministry of Corporate Affairs (MCA) issued notification to enforce 98 sections. This was hailed as a premature action of the MCA, case in point being sections relating to insider trading, powers of Board, reference to the National Company Law Tribunal (NCLT), which still required clarifications.
The MCA attempted to control its premature action by way of another clarification on 13 September 2013 and further by way of issue of Companies (Removal of Difficulties) Order, 2013 (the Order).
Although, the Order is surely a backtracking of sorts by the MCA, yet it brings back the power to adjudicate cases pertaining to ‘rectification of register of members’ to Company Law Board (CLB). The Order relates to sections 24, 58 and 59 of the Act.
Scenario under the Companies Act, 1956
The erstwhile Section 155 of the Act, 1956 empowered any aggrieved person to appeal to the court to seek rectification of register of members. This section was not limited just to rectification of register of members on matters pertaining to transfer or transmission, but extended to cases on any default or delay in entry in the register of members in cases apart from transfer and transmission. This section actually flowed from section 22A of the Securities Contracts (Regulations) Act, 1956 which allowed listed companies to refuse registration only under four scenarios. However, the stated section 22A was omitted with effect from 20 September 1995. Section 155 of the Act, 1956 was also omitted by the Companies (Amendment) Act, 1988 (wef 31 May 1991), vide GSR dated 31 May 1991.
Section 111 of the Act, 1956 was substituted with effect from 31 May 1991 by the Companies (Amendment) Act, 1988. With the insertion of section 111A of the Act, 1956 a void that was created with the deletion of section 155 of the Act, 1956 still remained. Section 155 of the Act, 1956 was applicable to public as well as private companies and allowed appeal for refusal to register in case of transfer or transmission or any other matter. Section 111(4) was also on the same lines, but by virtue of section 111(14) of the Act, 1956, the same was applicable only to private companies. Section 111A was made applicable only to public companies and consequently, appeal under this section could only lie with CLB, if the same pertained to disputes relating to either transfer or transmission. Any non-transfer or non-transmission case for public companies would become a civil matter, to be dealt with by the civil court.
A brief on the sections under Act, 2013
Section 24 – This section corresponds to section 55A of the Act, 1956 whereby matters pertaining to prospectus, return of allotment, redemption of preference shares shall be exercised by the NCLT.
Section 58 – This section corresponds to sections 111 and 111A of the Act, 1956 and empowers any person to appeal to NCLT against any refusal to register transfer or transmission of shares.
Section 59 – This section corresponds to sections 111 (4), (5), (9) and sec. 111A (3) and (5) of the Act, 1956 and empowers any aggrieved person or member to make an appeal if his name is without sufficient cause entered in the register of members and if registered removed from such register.
Power vested with CLB
The Preface of the Order, 2013 clearly mentions that the constitution of NCLT will take some time which gives rise to the question that since sections 24, 58 and 59 of the Act, 2013 have come into force, then which is the right forum for filing appeal? The Order, 2013 has thus been issued to solve this problem in exercise of section 470 of the Act, 2013.
Gist of the Order:
The Order confers jurisdiction on CLB for appeals under sections 24, 58 and 59 of the Act 2013, until the constitution of NCLT.
With the Order, 2013, the jurisdiction of CLB has been again extended to also include cases pertaining to rectification of register of members on matters other than transfer or transmission pursuant to section 59 of the Act, 2013. The stated section 59 allows an aggrieved person to file an appeal for rectification of register of members. Such appeals shall till the constitution of NCLT, lie with CLB. Section 59 of the Act, 2013 has sought to amend the lacuna which was present in section 111A of the Act, 1956 and with CLB being empowered for the time being to handle such matters, wisdom seems to have prevailed.
The Parliamentary Committee has sought citizens’ suggestions on the RTI Amendment Bill, 2013. However, there seems to be a deliberate attempt by government to restrict responses to Hindi and English languages, thus depriving half of the population a chance to file their suggestions and objections
The latest two ordinances—one to protect Lalu Prasad Yadav from his mega fodder scam and the other to scuttle Supreme Court’s judgment on banning politicians who are convicted of a crime to contest—has further angered people of the brazenness with which these netas are indulging in lawlessness.
The Right to Information (RTI) Amendment Bill, 2013 which aims to keep political parties out of the RTI ambit was also meant to be passed quickly in the Parliament as the netas would have liked it to be, met a hurdle thanks to a vociferous nation-wide campaign by RTI activists and citizens. The Bill was sent to a Parliamentary Committee.
Shantaram Naik, who heads the Committee, has called for opinions and suggestions from citizens and organizations, through an advertisement on 21 September. The suggestions could be sent by post within 15 days of the release of the advertisement, which is 6 October, or in person. The Committee will ask those citizens, organizations and stakeholders who would like to orally put forth their say, to be present personally at a particular date.
However, after the Parliament has bowed down to citizen pressure and sent the amendment bill to a Parliamentary Standing Committee, there seems to be an attempt to get ‘poor’ response. Also, there seems to be confusion on the connotation of transparency for a political party. In order that individuals do not send meaningless suggestions, various RTI organizations are working towards making a well-studied draft. Aruna Roy, one of the pioneers of the RTI Act, who has steered this campaign is holding a meeting of members of National Campaign for People's Right to Information (NCPRI) to draft the suggestions tomorrow and will release it.
The other serious concern is that the Parliamentary Standing Committee has curiously asked citizens, through its advertisement, to “send your comments by email or by post (two copies must be sent) only in English or Hindi.’’
Venkatesh Nayak, who has picked up cudgels for the people on this campaign through Commonwealth Human Rights Initiative (CHRI) vehemently, states this has been deliberately done to limit the number of suggestions. He said, “The Constitution gives official recognition to 21 languages other than Hindi in the Eighth Schedule. The number of persons speaking languages other than Hindi easily outnumbers people who are primarily Hindi-speakers. According to the 2001 Census data only 41% of the citizens in India speak Hindi. A little more than 10% of the citizenry is familiar with English as a primary or secondary language. These statistics imply, close to one half of the population will be prevented from making submissions on the RTI Amendment Bill merely because of the language barrier.’’
Also, advertisements calling for these suggestions have also been restricted to these two languages only. Nayak argues that if public consultation on this issue is to be genuine and effective, then, “advertisements for submissions on the RTI (Amendment) Bill, 2013 must be published in the leading newspapers of all states in the local official languages; citizens must be informed of their right to submit views and comments on this Bill in any of the 22 languages recognised in the Eighth Schedule of the Constitution; translating the advertisement into the 22 official languages and translating back the submissions received from the people into the English and Hindi for the MPs on the Committee is not a difficult task for the Rajya Sabha Secretariat. They have a team of professional translators who provide simultaneous translation of speeches of members of Parliament (MPs) in every session. These people could be gainfully employed when Parliament is in recess.’’
So, is the Parliamentary fraternity, making a hoax of public consultations?
|It may be recalled that the Right to Information (Amendment) Bill, aims to keep political parties out of the ambit of the RTI Act and nullify the June 2013 decision of the Central Information Commission (CIC). The CIC has ordered that all six national political parties are public authorities and should immediately appoint Public Information Officers (PIOs) and Appellate Authorities (AAs). All the political parties came together to scuttle it|
Venkatesh Nayak’s views on limiting suggestions from public
Language of submissions:
It is most unfortunate that the Parliamentary Committee vetting the RTI Amendment Bill permits submissions to be made only in English and Hindi on such an important issue which affects every citizen of India. There are at least four problems with this blinkered approach.
First, the Constitution gives official recognition to 21 languages other than Hindi in the Eighth Schedule. The number of persons speaking languages other than Hindi easily outnumbers people who are primarily Hindi-speakers. According to the 2001 Census data only 41% of the citizens in India speak Hindi. A little more than 10% of the citizenry is familiar with English as a primary or secondary language. These statistics imply, close to one half of the population will be prevented from making submissions on the RTI Amendment Bill merely because of the language barrier.
Second, when Electronic Voting Machines mention names of candidates in English and the local official language of the State for the purpose of elections to Parliament, is there any justification for limiting submissions to the Parliamentary Committee to two languages only? If languages are important only for the purpose of electing MPs but not for collecting their views about making or amending laws to inform these very MPs can India claim to be a true democracy where everybody has equal space and opportunity for participating in the law-making processes?
Third, many members of the Parliamentary Committee (see 2nd attachment) are themselves elected from or live in States where neither Hindi nor English is spoken by a majority of the citizens. Yet, there is no record in the public domain of any of these MPs demanding that opportunities be created for their brothers and sisters to send their comments on such an important issue in the official language(s) of the State.
Fourth, Article 350 of the Constitution gives every citizen the right to make representations to any authority of the Central or State Government in any of the official languages used at the Central or State level. The Parliamentary Committee must recognise and honour this important constitutional principle in the context of making or amending laws and create opportunities for people to send their comments on the RTI Amendment Bill (3rd attachment) in any of the languages recognised in the Eighth Schedule.
How can this inequality of opportunity be remedied?
It is high time MPs raised the issue of equality of people's access to the Committee's proceedings in terms of official languages used in India. The Committee has a constitutional duty to take the following steps to ensure equality of access to all citizens who wish to submit their opinion about whether political parties should or should not be covered by the RTI Act:
1) Advertisements for submissions on the RTI (Amendment) Bill 2013 must be published in the leading newspapers of all States in the local official languages;
2) Citizens must be informed of their right to submit views and comments on this Bill in any of the 22 languages recognised in the Eighth Schedule of the Constitution.
3) The present time limit of 15 days for sending comments must be extended to at least 30 days to enable people to send their comments in various languages after holding local level consultations.
4) Translating the advertisement into the 22 official languages and translating back the submissions received from the people into the English and Hindi for the MPs on the Committee is not a difficult task for the Rajya Sabha Secretariat. They have a team of professional translators who provide simultaneous translation of speeches of MPs in every Parliament session. These people could be gainfully employed when Parliament is in recess.
What you can do to expand the consultation opportunity for all citizens:
I urge you to SMS the following message to the Chairperson of the Parliamentary Committee- Mobile No.: 09422439990
"Please take all necessary steps to enable people to send their comments on the RTI Amendment Bill, 2013 in all 22 languages recognised by our Constitution."
This message is less than 160 characters long. The cost little of sending one SMS from any part of India, is very less.
Or you may send a post card, fax, or email with your message to:
Department-related Parliamentary Standing Committee on Personnel, Public Grievances, Law and Justice
Rajya Sabha Secretariat, #222, 2nd Floor, Parliament House Annexe; New Delhi- 110 001
Email address: [email protected]; Fax: 011-23016784
Or you may send the SMS or postcards, fax or email to all MPs on the Committee.
Please remember to copy your emails and messages to me.
Access to Information Programme
Commonwealth Human Rights Initiative
B-117, 1st Floor, Sarvodaya Enclave
New Delhi- 110 017
Tel: +91-11-43180201/ 9871050555
STATEMENT OF OBJECTS AND REASONS IN THE RTI AMENDMENT BILL, 2013:
The Right to Information Act, 2005 was enacted by the Government for setting out a framework for effectuating the right to information for citizens and to secure access to information under the control of public authorities, in order to promote transparency and accountability in the working of every public authority.
2. The Central Information Commission in one of its decision dated 03.06.2013 has held that the political parties namely AICC/INC, BJP, CPI (M), CPI, NCP and BSP are public authorities under section 2(h) of the said Act. The Government considers that the CIC has made a liberal interpretation of section 2(h) of the said Act in its decision. The political parties are neither established nor constituted by or under the Constitution or by any other law made by Parliament. Rather, they are registered or recognised under the Representation of the People Act, 1951 and the rules/orders made or issued thereunder.
3. It has also been observed that there are already provisions in the Representation of the People Act, 1951 as well as in the Income-tax Act, 1961 which deals with the transparency in the financial aspects of political parties and their candidates.
4. Declaring a political party as public authority under the RTI Act would hamper its smooth internal working, which is not the objective of the said Act and was not envisaged by Parliament under the RTI Act. Further, the political rivals may misuse the provisions of RTI Act, thereby adversely affecting the functioning of the political parties.
5. In view of above, the Government has decided to amend the RTI Act to keep the political parties out of the purview of the RTI Act, with a view to remove the adverse effects of the said decision of the CIC. It is also necessary to give retrospective effect to the proposed amendment with effect from the date of the said decision of CIC, that is, 3rd day of June, 2013.
The market is still getting what is being supplied from presumably hoarded stocks of onions by wholesalers and the middlemen
It is almost three months now. Onions, one of the most commonly used ingredient in the Indian cuisine, has remained out of reach for the aam aadmi. Only the rich can really afford to pay Rs70-85 for a kilo!
In order to overcome the public outcry, the Indian government decided to import onions from China and Pakistan to ensure supplies by the middle of September, when the crop from Karnataka would come into the market.
When this idea was floated, it was realised that the actual process of ordering and shipping would really serve no purpose at all, because by the time the foreign onions hit the market, native onions would have come in to meet the demand, and perhaps, help reduce the price.
Alas, the truth is, none of these have happened so far, as the market is still getting what is being supplied from presumably hoarded stocks of onions by wholesalers and the middlemen!
Except for assurances, the government has not been able to meet the domestic requirements by employing stricter controls. Nor have they been able to reduce the prices and make them affordable for the common man or even keep up the export commitments made earlier.
Telecom Minister, Kapil Sibal stated, rather grandiosely, that, “The Government is not the one selling onions”. Yes, that is true Minister, but what they can do is to reduce the control that the middlemen have on agricultural produce, although the middlemen cannot be eliminated altogether. Milton Friedman said, “Governments never learn; only people learn.” They are the ones who are unable to get the poor man's luxury of onions!
A day after landing in Dubai, the largest importer of Indian produce, this writer made visits to the retail shops (convenience stores) and the Karamah vegetable market to see what the fate of consumers of onions in this premier gulf city, which is also the centre of entrepot trade for the gulf countries.
According to the media, T Arun, CEO of Al Madina Hypermarket in Al Quoz has stated: “It seems the prices have reached the peak and we expect fresh shipments in October, when prices might stabilise. That's why we did not order bulk quantities.”
UAE imports onions from India and Pakistan. The price of onions has shot up from Dh2 to Dh4 per Kg (Dh1 = Rs17.80) though, in some shops price quoted varied from Dh3.75 to Dh5 (from small grocery stores to shops in large apartment houses).
Chinese onions are also not cheap, according to many Indian housewives. Many Indian women in Dubai go to work, and they prefer the quality of Indian onions, which they are accustomed to use in their cuisine.
What should the government really do? It must encourage farmers to increase the acreage for such produce as onions, and ear mark definite quantities for export. More importantly, they must consider if they can bring about MSP (minimum support price) for onions. As otherwise, Mr Sibal must realise that while the government may not be in the business of selling onions, they may not be in the business of governance for long!
(AK Ramdas has worked with the Engineering Export Promotion Council of the ministry of commerce. He was also associated with various committees of the Council. His international career took him to places like Beirut, Kuwait and Dubai at a time when these were small trading outposts; and later to the US.)