SC stays NCLT order in TATA case- THE HINDU- 25-01-2020
The NCLAT had made scathing comments in the judgment about the RoC for altering the certificate of incorporation to facilitate the “purported conversion” of Tata Sons from a public entity to a private company on August 6, 2018. Contending on the merits of the January 6 order, TSPL said the tribunal reached an “anomalous and absurd” conclusion that there cannot be a private limited company since the minimum paid-up capital had not been prescribed by the Centre. TSPL said the absence of any requirement for a minimum paid-up share capital only proves that there is no such need for the purposes of constituting a private limited company under the Companies Act of 2013. TSPL also said post the coming into effect of the Companies Act of 2000, power has been conferred on the RoC to “effect changes and alterations in the Certificate of Incorporation in a case where a deemed public limited company became a private limited company by operation of law.
” Lastly, TSPL is a de jure private company and requires no amendment to its articles/memorandum which would have the effect of converting into a private limited company. “In other words, since the appellant is already a private limited company, it does not need to re-convert into a private company in terms of the procedure under Sections 14 and 18 of the 2013 Act,” TSPL contended in the Supreme Court.