Section 458 of the Companies Act, 2013 (hereinafter referred to as “Act, 2013”) empowers the Central Government to delegate its powers and functions to the Regional Director or the Registrar of Companies wherever required. In exercise of its powers under Section 458, the Central Government vide notification S.O. 4090(E) dated 19 th December 2016 , has delegated the powers and functions vested in it under certain sections of the Act, 2013 to the Regional Directors based at Mumbai, Kolkata, Chennai, New Delhi, Ahmedabad, Hyderabad and Shillong.
This is subject to the condition that the Central Government may revoke such delegation of powers or may itself exercise the powers under the said sections, if in its opinion such a course of action is necessary in the public interest.
The notifications issued by the Ministry of Corporate Affairs (‘MCA’), , dated 10 th Ju 2012 and 21 st May 2014 shall accordingly be superseded. The effective date of notification S.O. 4090(E) dated 19 th December 2016 is 19 th December 2016 when the said notification got published in the Official Gazette.
The sections for which the Central Government has delegated its powers and/ or functions have been listed below:-
| Serial No. | Section No. | Particulars of power of Central Government | Remarks |
| 1. | 8(4)(i) | A company registered under this section shall not alter the provisions of its memorandum or articles except with the previous approval of the Central Government. | A Section 8 Company will need previous approval of the Regional Director before making alterations in its memorandum or articles. The license is however currently granted by the Registrar of Companies.Power to grant license of Section 8 company by Registrar of Companies comes vide MCA Notification dated 21 st May, 2014. |
Under the present Notification dated 19 th December, 2016, only the alteration in memorandum or articles of Section 8 company will be permitted for the prior approval of the Regional Director. (Previously, vide MCA notification dated 21 st May, 2014; the previous approval of Regional Director was required in order to make alteration of memorandum for conversion of Section 8 company to another kind of company.
If the memorandum of Section 8 company was to be altered for any other reason, then the previous approval of Registrar of Companies was required.)
Provided that no such order shall be made unless the company is given a reasonable opportunity of being heard:
Further, Regional Director has the power to direct the company to convert its status and change its name to add the word “Limited” or the words “Private Limited”, as the case may be, to its name.
After the order of Regional Director, the Registrar will register the Company accordingly. The grant of license is however made by the Registrar of Companies.
Power to grant license of Section 8 company by Registrar of Companies comes vide MCA Notification dated 21 st May, 2014.
If, through inadvertence or otherwise, a company on its first registration or on its registration by a new name, is registered by a name which,—
(a) in the opinion of the Central Government, is identical with or too nearly resembles the name by which a company in existence had been previously registered, whether under this Act or any previous company law, it may direct the company to change its name and the company shall change its name or new name, as the case may be, within a period of three months from the issue of such direction, after adopting an ordinary resolution for the purpose;
87. (1) The Central Government on being satisfied that—
(i) (a) the omission to file with the Registrar the particulars of any charge created by a company or any charge subject to which any property has been acquired by a company or any modification of such charge; or
(b) the omission to register any charge within the time required under this Chapter or the omission to give intimation to the Registrar of the payment or the satisfaction of a charge, within the time required under this Chapter; or
(c) the omission or mis-statement of any particular with respect to any such charge or modification or with respect to any memorandum of satisfaction or other entry made in pursuance of section 82 or section 83, was accidental or due to inadvertence or some other sufficient cause or it is not of a nature to prejudice the position of creditors or shareholders of the company; or
Before granting approval for removal of auditor, Regional Director shall ensure whether a reasonable opportunity of being heard is given to the concerned auditor.
(a) in the case of a winding up by the Tribunal, with the Tribunal; and
(b) in the case of a voluntary winding up, with the Registrar:
361. (1) Where the company to be wound up under this Chapter, —
(i) has assets of book value not exceeding one crore rupees; and
(ii) belongs to such class or classes of companies as may be prescribed, the Central Government may order it to be wound up by summary procedure provided under this Part.
362. (1) The Official Liquidator shall expeditiously dispose of all the assets whether movable or immovable within sixty days of his appointment.
(2) The Official Liquidator shall serve a notice within thirty days of his appointment calling upon the debtors of the company or the contributories, as the case may be, to deposit within thirty days with him the amount payable to the company.
364. (1) Any creditor aggrieved by the decision of the Official Liquidator under section 363 may file an appeal before the Central Government within thirty days of such decision.
(2) The Central Government may after calling the report from the Official Liquidator either dismiss the appeal or modify the decision of the Official Liquidator.
(3) The Official Liquidator shall make payment to the creditors whose claims have been accepted.
365. (1) The Official Liquidator shall, if he is satisfied that the company is finally wound up, submit a final report to—
(i) the Central Government, in case no reference was made to the Tribunal under subsection (4) of section 364; and
(ii) in any other case, the Central Government and the Tribunal.
(2) The Central Government, or as the case may be, the Tribunal on receipt of such report shall order that the company be dissolved.
Provided that the rights conferred by this sub-section shall be exercisable—
Mediation and Conciliation Panel-
442. (1) The Central Government shall maintain a panel of experts to be called as the Mediation and Conciliation Panel consisting of such number of experts having such qualifications as may be prescribed for mediation between the parties during the pendency of any proceedings before the Central Government or the Tribunal or the Appellate Tribunal under this Act.
Conclusion
The delegation of powers by Central Government is done in order to ensure smooth functioning of business. The administrative responsibilities can be decentralised in order achieve specialisation of work and remove bottlenecks from the system.
The Central Government has been also empowered under Section 458 to revoke such delegation of powers or to exercise the powers itself if it is of the opinion that it is for the betterment of the public and stakeholders at large.
In the aforementioned table few sections of the Act, 2013 has not yet been enforced. We need to wait for the notification enforcing such sections. As soon as such sections are enforced the powers of Central Government will be delegated to the Regional Director, until then the powers and functions will be vested upon the Central Government.
(Author is associated as an Executive with Vinod Kothari & Company)