Section 374 of Companies Act, 2013 – Obligation of Companies registering under this Part

  • Updated Till : November 12, 2018

SECTION 374. OBLIGATIONS OF COMPANIES REGISTERING UNDER THIS PART

[Effective from 1st April, 2014]

Every company which is seeking registration under this Part shall,—

(a)   ensure that secured creditors of the company, prior to its registration under this Part, have either consented to or have given their no objection to company’s registration under this Part;

(b)   publish in a newspaper, advertisement one in English and one in vernacular language in such form as may be prescribed giving notice about registration under this Part, seeking objections and address them suitably;

(c)   file an affidavit, duly notarised, from all the members or partners to provide that in the event of registration under this Part, necessary documents or papers shall be submitted to the registering or other authority with which the company was earlier registered, for its dissolution as partnership firm, limited liability partnership, cooperative society, society or any other business entity, as the case may be;

(d) comply with such other conditions as may be prescribed.

[6] [Provided that upon registration as a company under this Part a limited liability partnership incorporated under the Limited Liability Partnership Act, 2008 shall be deemed to have been dissolved under that Act without any further act or deed.]

Applicable Rules

Companies (Authorised to Register) Rules, 2014

[Effective from 1st April, 2014] 

Rule 4. Obligation of companies seeking registration to make publication.— (1) For the purpose of clause (b) of section 374 of the Act, every ‘company’ seeking registration under the provision of Part I of Chapter XXI shall publish an advertisement about registration under the said Part, seeking objections, if any within twenty one clear days from the date of publication of notice and the said advertisement shall be in Form No. URC. 2, which shall be published [1][in a newspaper in English and in any vernacular language, circulating in the district in which [7] [Limited Liability Partnership, firm, society or trust, as the case may be, is situated.]

(2) A copy of the notice, as published and the copy of the notice served on Registrar (LLP) [8] [,Registrar of Firms, Registrar of Societies or Registrar of Trust, as the case may be] along with proof of service, shall be attached with Form No. URC. 1.

(3) The Registrar shall, after considering the application and the objections, if any, received by him within thirty days from the date of publication of advertisement, and after ensuring that the company has addressed the objections, suitably decide whether the registration should or should not be granted.

(4) If the Registrar in satisfied on the basis of documents and information filed by the applicants, decides that the applicant should be registered, he shall issue a certificate of incorporation in Form No. INC.11.

Rule 5. Other obligations of companies seeking registration.—For the purpose of clause (d) of section 374 of the Act, —

[9] [(i) where a firm, society or trust has obtained a certificate of registration under section 367 of the Act, an intimation to this effect shall be given within fifteen days of such registration to the concerned Registrar of Firms, Registrar of Societies or Registrar of Trusts, as the case may be, under which it was originally registered, along with documents for its dissolution as a firm, society or trust as the case may be.]

(ii)           statement of accounts, prepared not later than fifteen days preceding the date of seeking registration and certified by the Auditor together with the Audited Financial Statements of the previous year, wherever applicable shall be attached with Form No. URC. 1

Provided that if the assets of the existing company during the immediately preceding three years are revalued for the purpose of vesting of its assets with the company to be incorporated under this Act, the surplus arising out of such revaluation shall not be deemed to have been credited to the capital account or current account of partners.

(iii)          notice shall be given to the [3] [Registrar of firms] [10] [,Registrar of Societies or Registrar of Trusts, as the case may be] under which it was originally registered and shall require that objections, if any to be made by such concerned [4] [Registrar of firms] [11] [,Registrar of Societies or Registrar of Trusts, as the case may be] to the Registrar, shall be made within a period of twenty-one days from the date of such notice, failing which it shall be presumed that they have no objection and the notice shall disclose the purpose and substance of matters in relation to objections.

(iv)          in case of the registration of Limited Liability Partnership into a company under these rules, a declaration by the said Limited Liability Partnership that it has filed all documents which are required to be filed under the Liability Partnership Act with the Registrar (LLP) and the declaration shall be attached with Form No. URC. 1;

(v)           [a statement of proceedings, if any, by or against the [12] [Limited Liability Partnership, firm, society or trust] as the case may be] [5] which are pending in any court or any other Authority shall be attached with Form No. URC. 1.

[13] [(vi) in case a society or trust intending to register as a company under section 366 of the Act is registered under section 12A of the Income Tax Act, 1961 (43 of 1961) for claiming exemption on its income, an intimation in this regard shall be sent to the Income- tax authorities and proof of its service shall be attached with Form No. URC. 1;.

(vii) upon registration of a society or trust as a company under the Act, no application for conversion into a company of any other kind, except conversion from a private company to a public company or vice- versa, shall be made till the expiry of a period of ten years from the date of incorporation under the Act.

(viii) no application for registration as a company under the Act shall be made by a trust during the pendency of any proceedings under section 92 of the Code of Civil Procedure (5 of 1908).]

 

 

 

[1] Substituted for the words “in a newspaper and in English and the in the principal vernacular language of the district in which Limited Liability Partnership is in existence and circulated in that district” by the Companies (Authorised to Register) Rules, 2014 vide notification no. F. No. 1/35/2013 CL-V dated 31st May 2016

[2] Substituted by the Companies (Authorised to Register) Rules, 2014 vide notification no. F. No. 1/35/2013 CL-V dated 31st May 2016. Prior to substitution it read as under:-

“(i) where a Limited Liability Partnership has obtained a certificate of registration under section 367, an intimation to this effect shall be given, within fifteen days of such registration to the concerned Registrar (LLP) under which it was originally registered, along with necessary documents or papers for its dissolution as Limited Liability Partnership;”

[3] Substituted for the words “concerned Registrar (LLP)” by the Companies (Authorised to Register) Rules, 2014 vide notification no. F. No. 1/35/2013 CL-V dated 31st May 2016

[4] Substituted for the words ” Registrar of Companies (LLP)” by the Companies (Authorised to Register) Rules, 2014 vide notification no. F. No. 1/35/2013 CL-V dated 31st May 2016

[5] Substituted for the words “a statement of proceedings, if any, by or against the Limited Liability Partnership” by the Companies (Authorised to Register) Rules, 2014 vide notification no. F. No. 1/35/2013 CL-V dated 31st May 2016

[6] Inserted by the Companies (Amendment) Act 2017 vide Notification No. File No. 1/1/2018-CL.I-Part  dated 5th July, 2018 effective from 15th August, 2018.

[7] Substituted for the words “Limited Liability Partnership or the firm as the case may be is situated” by the Companies (Authorised to Register) Second Amendment Rules, 2018 vide Notification No. File No. 01/04/2016 CL V dated 5th July, 2018 effective from 15th August, 2018.

[8] Inserted by the Companies (Authorised to Register) Second Amendment Rules, 2018 vide Notification No. File No. 01/04/2016 CL V dated 5th July, 2018 effective from 15th August, 2018.

[9] Substituted by the Companies (Authorised to Register) Second Amendment Rules, 2018 vide Notification No. File No. 01/04/2016 CL V dated 5th July, 2018 effective from 15th August, 2018. Prior to the substitution it read as under:

“[(i) where a firm has obtained a certificate of registration under section 367, an intimation to this effect shall be givery within fifteen days of such registration to the concerned Registrar of firms under which it was originally registered, along with papers for its dissolution as a firm;] [2]

[10] Inserted by the Companies (Authorised to Register) Second Amendment Rules, 2018 vide Notification No. File No. 01/04/2016 CL V dated 5th July, 2018 effective from 15th August, 2018.

[11] Inserted by the Companies (Authorised to Register) Second Amendment Rules, 2018 vide Notification No. File No. 01/04/2016 CL V dated 5th July, 2018 effective from 15th August, 2018.

[12] Substituted for the words “Limited Liability Partnership or the firm” by the Companies (Authorised to Register) Second Amendment Rules, 2018 vide Notification No. File No. 01/04/2016 CL V dated 5th July, 2018 effective from 15th August, 2018.

[13] Inserted by the Companies (Authorised to Register) Second Amendment Rules, 2018 vide Notification No. File No. 01/04/2016 CL V dated 5th July, 2018 effective from 15th August, 2018.

 

 

Corporate Law Referencer

Recent Articles

Recent Legal updates

Recent Gst Updates