7952final_clsp_nov05.pdf - PAPER \u2013 4 CORPORATE LAWS AND SECRETARIAL PRACTICE Question Nos 1 2 and 3 are compulsory Answer any four questions from the

7952final_clsp_nov05.pdf - PAPER – 4 CORPORATE LAWS AND...

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PAPER – 4 : CORPORATE LAWS AND SECRETARIAL PRACTICE Question Nos. 1, 2 and 3 are compulsory. Answer any four questions from the rest of the questions. Question 1 Answer any two of the following (a) The Board of Directors of ABC Ltd. met thrice in the year 2004 and the 4 th Meeting, though called, could not be held for want of quorum. Examine with reference to the relevant provisions of the Companies Act, 1956, the following: (i) Whether any provisions of the Companies Act, 1956 have been contravened? (ii) Is a Director bound to attend the Board Meetings and when his frequent absence from the Board Meeting may be excused? (5 Marks) (b) Describe the provisions of the Securities Contracts (Regulation) Act, 1956 regarding the powers of the Central Government to supersede the Governing Body of a recognized Stock Exchange and the consequences of such supersession. (5 Marks) (c) (i) Delhi Stock Exchange wants to establish additional trading floor. Advise. (ii) Complaints of unethical practices have been received against members of a recognized Stock Exchange by the Government. Examine whether the government has any power to suspend the business of such a recognized Stock Exchange. (5 Marks) Answer (a) (i) As per Section 285 of the Companies Act, 1956, a company must hold a meeting of its Board of Directors at least once in every three calendar months and there should be at least four directors’ meeting every year. However, the Central Government may by notification in the official Gazette, direct these provisions will not apply in relation to any class of companies or will apply in relation thereto subject to such exceptions, modifications or conditions as may be specified in the notification. But in the terms of Section 288(2), a company shall not be deemed to have contravened the provisions of Section 285 where the meeting had been called but could not be held for want of a quorum. (ii) Though a director is not so bound to attend the Board meetings, nonetheless, he will be guilty of breach of duty if he fails to attend the Board meetings with reasonable regularity without sufficient cause being shown for his non-attendance. Willful non-attendance on his part may give rise to his liability on ground of negligence if it is patently prejudicial either to the company or to the general body of shareholders. Fairly frequent absence from the Board meetings may, however, be execused if the entire control is exercised by a single director or if the Board is pretty large in number (Re Denhom & Co. D.25 ch. D. 752 Marquis of Bute’s Case (1892)2 Ch. 100). The fewer the directors, the more onerous is the duty to attend.
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PAPER – 4 : CORPORATE LAWS AND SECRETARIAL PRACTICE 59 (b) According to the provisions of section 11 of the Securities Contracts (Regulation) Act, 1956, where the Central Government is of opinion that the governing body of any recognized stock exchange should be superseded, then notwithstanding any thing contained in any other law for the time being in force, the Central Government may serve
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  • Spring '18
  • Rajit

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