VOLUME NO.

XXIII 4 APRIL 2006

EDITORIAL ADVISORY CENTRAL COUNCIL

Annual Subscription
BOARD MEMBERS
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CHAIRMAN PRESIDENT Single Copy
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MEMBERS VICE-PRESIDENT
Edited, printed and published
(In alphabetical order) PREETI MALHOTRA (MS.) by N.K. Jain for the Institute of
V. K. AGARWAL MEMBERS Company Secretaries of India,
DR. GIRISH AHUJA (In alphabetical order) 'ICSI House', 22, Institutional
V. K. BHASIN BIPIN S ACHARYA Area, Lodi Road,
G. R. BHATIA NESAR AHMAD New Delhi - 110003
MAHESH ANANT ATHAVALE l Phones : 24617321-24,
RENU BUDHIRAJA (MS.)
24644431-32, 41504444
DR. K.N. CHANDRASEKHARAN PILLAI RITA DIXIT (MS.)
l Grams : Compsec
RAKESH CHANDRA DATLA HANUMANTA RAJU l Fax : 91-11-24626727
DELEP GOSWAMI S.D. ISRANI (DR.) l E-mail : info@icsi.edu
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R. RAVI l The Institute is not in anyway
EDITOR & PUBLISHER
responsible for the result of any
N. K. JAIN AMIT KUMAR SEN
action taken on the basis of the
V. SREEDHARAN advertisements published in
SECRETARY & CHIEF EXECUTIVE OFFICER this Bulletin.
N. K. JAIN

H I G H L I G H T S
l From the President 03
l SMTP Organised by HQ/RCs/Chapters 04
l Academic Guidance 05
Examiners' Observations on Performance of Examinees 22
(December 2005 Examination)
l Legal World 27
l Students Services 30
l Students Quiz 34
l Schedule of Academic Development Programmes 36
l Schedule of Training Orientation Programmes 36
l News and Announcements 38

Student Company Secretary 1 April 2006

 TRAINING ORIENTATION PROGRAMME
As per Company Secretaries Regulations, 1982 (amended
from time-to-time) every student apart from passing the final
examination of the Institute is also required to possess the
practical experience and undergo practical training or be
exempted therefrom before becoming eligible to the Associate
Membership of the Institute. Students who do not possess
practical experience are required to undergo compulsorily 15
months Management/Apprenticeship training.
Most of the students commencing training are not aware of
the significance and methodology of training, business
environment, corporate culture, communication and
behavioural aspects. Keeping in view the above factors, the
Council of the Institute has decided that students requiring to
undergo training should compulsorily attend five days Training
Orientation Programme (TOP) before they are sponsored for
training. It has also been decided that henceforth students
will be sponsored for training in the companies or with company
secretaries in practice as per the following schedule.

Activities Session1 Session 2 Session 3 Session - 4

Registration of students January 1 to March 01 to June 01 to September 01 to
for 15 months Training January 10 March 10 June 10 September 10
Organisation of TOP January 15 to March 15 to June 15 to September 15 to
January 24 March 24 June 24 September 24
Campus Interview January 25 to March 25 to June 25 to September 25 to
January 31 March 31 June 30 September 30
Commencement of February 01 April 01 July 01 October 01
Training Onwards Onwards Onwards Onwards
Completion of April 30* June 30* September 30* December 31*
Training Next Year Next Year Next Year Next Year
* If the student avails extra leave, the training will be extended accordingly.
Training Orientation Programme is a part of the 10. Usefulness of reading newspapers
Management/Apprenticeship training and is based on Guru 11. Self-assessment
Shishya Parampara. Training Orientation Programme will not SWOT analysis
only expose the students to the business environment and Career prospects
corporate functioning but would also help them in acquiring
Personality
the desired skill and confidence.
12. Writing of curriculum vitae
The Regional Councils will organize the Training Orientation
Programme from 15th to 24th of the four fixed months i.e. 13. Interview Techniques
January, March, June & September. 14. Career Planning
For effective interaction and participation, not more than 15. Computer-Internet/E-mail
40 students would be enrolled in each TOP. A fee of Rs. 400/ 16. File management
- per participant will be charged. 17. Organisation structure, role and functioning of Competition
The following topics will be included in the programme : Commission of India, CLB/NCLT, ROC, Stock Exchange,
SEBI, RBI, DRT
1. Importance of Training
18. Usefulness of Professional Development Programmes.
2. Personality Development- Dress Code & How to carry
oneself 19. Code of Conduct
20. Future Prospects
3. Time Management
For helping the students to identify Companies or Company
4. Meaning of Professionals
Secretaries in practice for undergoing training, the Regional
5. Office Culture Councils would also arrange Campus Interviews, immediately
6. Communication Skill on conclusion of each TOP for on-the-spot selection of
Writing ability candidates. Such Campus Interviews will be organized during
Drafting of letters the four fixed months from March 25 to 31; June 25 to 30;
Speaking ability September 25 to 30 and January 25 to 31.
All students intending to commence Management/
7. Group discussion, Drafting of Minutes, Notices,
Apprenticeship training are advised to contact the respective
Resolutions etc.
Regional Councils for enrolling themselves for TOP. Only on
8. How to qualify professional examination successful completion of TOP, students would be sponsored
9. Managing under crisis for training by the Institute.

Student Company Secretary 2 April 2006

 FROM THE PRESIDENT

Vision without action is merely a dream.

Action without vision just passes the time.
Vision with action can change the world.
Joel Arthur Baker
Dear Students,
Learning has the power to transform us. The world has become a global village and in this global village enormous opportunities
exist for those who are competitive and have acquired the global business skills and knowledge. The ability to obtain, assimilate
and apply the right knowledge effectively will become a key skill in the next century. We are witnessing an era of knowledge and
intellect, where innovation is the key for the production and processing knowledge. Our survival in the twenty-first century as
individuals, organizations and nations, will depend on our capacity to learn. Our ability will no longer be judged solely by
qualifications gained in the past, but will also be assessed by our capacity to learn and adapt in the future. Learning is a
fundamental skill. Everyday it is said we learn something new. While learning, equally important is to develop the ability to learn
quickly. The ability to learn quickly is also an integral part of a successful career. You might have experienced that your ability to
learn during school heavily influences your grades, the quality of your education, and the choices you have for a career. Your
ability to learn on the job has a significant impact on your employment, promotion prospects and overall income or business
success. While your employment may provide formal training, the value you get from such training depends on your personal
learning skills. So it is important for every professional and students in particular to imbibe the skill of learning.
Friends, during my visit to Hyderabad, Bhubaneswar and Chennai in the previous month, I met members, faculty members,
students and the parents. Continuing the initiatives of the Institute towards providing better facilities to Chapters, I am pleased
to inform you that new office building of Bhubaneswar Chapter has been inaugurated. I am sure with this new facility, the
Bhubaneswar Chapter would provide value added services to the members and students, organize quality programmes and
enhance the brand image of the Institute and the profession of Company Secretaries.
I am pleased to inform you that the Institute successfully organised a National Seminar on Labour Law Reforms for Good
Corporate Governance, on April 8, 2006 at New Delhi. The Conference attracted huge gathering including delegates, invitees
and dignitaries. The seminar was inaugurated by Shri Chandra Sekhar Sahu, Honble Minister of State for Labour and Employment.
While inaugurating the National Seminar, Shri Chandra Sekhar Sahu said that the compliance of various labour laws by industries
and commercial establishments had assumed added significance in marching towards good corporate governance. Indian
industry is going through a crucial phase of restructuring as competition increases, so India will have to expedite the labour
reforms and brave the pangs of change in the interest of long-term economic sustainability, observed Minister and explained
that there was need for proper labour reforms in both organised and unorganised sector to suit the demands of the changing
paradigm. The Minister urged the Institute to continue to work to make the labour laws major contributory to the economic
development of the country and good corporate governance.
In his opening observations Coen Kompier, Senior Specialist in International Labour Standards, ILO said that good labour laws
and their effective implementation was essential for good corporate governance. Speaking on the concept of compliance of
labour law as propagated by the ICSI, Coen observed that the concept of compliance of labour laws was very innovative and
may be challenging. Speaking on labour law reforms in India, Coen observed that there was consensus that the labour laws
should be changed. Referring to the labour law reforms in Bangladesh, Pakistan and Nepal, Coen informed that India was far
ahead than these countries on labour law reforms front and expressed optimism about the future of labour laws in India.
I am pleased to inform you that a Live Panel discussion on Corporate Restructuring was telecast on Gyan Darshan II between

Student Company Secretary 3 April 2006

2.30 and 3.30 P.M. on 28th March 2005. Shri U.K. Chaudhary, (Past President, The ICSI), Senior Advocate participated in the
one hour deliberations. Students and members interacted through teleconferencing with Shri U.K. Chaudhary during an hour-
long LIVE panel discussion.
The profession of Company Secretaries through its glorious history has linked itself to the collegiate of established professions
and growing apace. As the emerging paradigm is constantly changing and making the market place more competitive and
contestable, the profession has to take the lead to renew, reinvent and reshape itself to reach the further acme of excellence
and competitiveness. It is in this direction that the Council of the Institute has selected Reshaping the Profession Creating
New Niches as theme for deliberation at the 34th National Convention to be held on September 7-9, 2006 at Kolkata. You note
these dates in your diary for attending the Convention. The details of the same have been published in the April 2006 issue of
the Chartered Secretary. I advise you to ensure your participation at the Convention as a delegate.

With best wishes,

Yours sincerely,

(H M Choraria)
choraria123@vsnl.net
Kolkata
April 13, 2006

SMTP ORGANISED BY H.Q./REGIONAL COUNCILS/CHAPTERS

ELIGIBILITY OF PARTICIPANTS : ICSI Final passed candidates. SMTP COURSE CONTENTS: Module I-Filling and Filing of Forms under the
Companies Act, 1956. q Module II-Practical and Procedural Aspects of Convening and Conducting Board Meetings & Annual General Meetings
and Related Aspects. q Module III-Managing Public Issues. q Module IV-Loan Documentation, Joint Ventures & Foreign Collaborations, Raising
Finance through EURO Issues and Export & Import Procedures and Documentation. q Module V-Practical and Procedural Aspects relating
to Appearance before CLB/Under SICA, Consumer Protection Act and Case Studies in RTP/UTP. In addition, the participants would be exposed
to case studies and mock board/general meeting, etc.
Organised by Dates & Duration Venue of Programme Contact Address
NIRC of 26.04.2006 NIRC Premises Executive Officer, NIRC of the ICSI, ICSI-NIRC Bldg., Plot No. 4, Prasad
the ICSI to Nagar Institutional Area, Rajendra Place, New Delhi-110005 Tel. : 25763090/
12.05.2006 25767190 Fax No. : 25722662 (Code No. 011) E-mail : niro@icsi.edu/
icsi@eth.net
Chandigarh 30.04.2006 To be announced Secretary, Chandigarh Chapter of NIRC of the ICSI, GGDSD College, Sector-
Chapter of NIRC to 32C, Chandigarh-160047 Tel. : 0172-2661840
of the ICSI 14.05.2006
SIRC of 26.07.2006 SIRO Premises Deputy Director, SIRC of the ICSI, SIRC-ICSI House, No. 9, Wheat Crofts
the ICSI to Road, Nungambakkam, Chennai-600034 Tel. :044-28279898/28268685
11.08.2006 Fax No. : 044-28268685 E-mail : icsisirc@md3.vsnl.net.in/siro@icsi.edu
WIRC of 24.06.2006 ICSI-CCRT, Plot No. 101 Joint Director, WIRO of the ICSI, 13, Jolly Maker Chambers No. 2, First Floor
the ICSI to Sector-15, Institutional Nariman Point, Mumbai-400021 Tel. : 22047580/22021826/
09.07.2006 Area, CBD Belapur, 22844073/22047569 Fax No. : 022-22850109 E-mail : wircicsi@vsnl.com/
Navi Mumbai-400614 wiro@icsi.edu
CCRT of 24.06.2006 ICSI-CCRT Programme Co-ordinator, SMTP, CCRT of the ICSI, Plot No. 101, Sector-15
the ICSI to Plot No. 101, Sector 15 Institutional Area, CBD Belapur, Navi Mumbai-400614 Tel. : 27577814-16
09.07.2006 Institutional Area (STD Code : 022) Fax No. : 022-27574384 E-mail : ccrt@vsnl.com
(Residential CBD Belapur
SMTP) Navi Mumbai-400614
The schedule of other SMTPs proposed to be organised by NIRC, SIRC & Bangalore Chapter during 2006 is as under :
NIRC : (i) 30.05.2006 to 15.06.2006 (ii) 01.07.2006 to 19.07.2006 (ii) 01.08.2006 to 19.08.2006 (iv) 04.09.2006 to 20.09.2006
SIRC : 12.09.2006 to 28.09.2006 Bangalore Chapter : 11.09.2006 to 27.09.2006

Student Company Secretary 4 April 2006

 ACADEMIC GUIDANCE
ACADEMIC GUIDANCE
COMPANY LAW UPDATES1
(INTER/FINAL)
1. COMPANIES (CENTRAL GOVERNMENTS)
COMPANIES
GENERAL RULES AND FORMS
(AMENDMENT) RULES, 2006
PUBLISHED IN THE GAZETTE OF INDIA, EXTRA
ORDINARY, PART II, SECTION 3, SUB-SECTION (I)
MINISTRY OF COMPANY AFFAIRS
(Refer March 2006 issue of this bulletin at page 8)
2. MCA21-A BRIEF
(Refer March 2006 issue of this bulletin at page 8)
3. CORPORA TE GOVERNANCE IN
AT
LISTED COMP ANIES-CLAUSE 49 OF
COMPANIES-CLAUSE
THE LISTING AGREEMENT2
SEBI, as part of its endeavour to continuously improve the
standards of corporate governance in line with the needs of a dynamic
market, constituted a Committee on Corporate Governance under
the Chairmanship of Shri N.R. Narayana Murthy to review the
performance of Corporate Governance to enhance the transparency
and integrity of the market.
Based on the recommendations of the Committee and also with a
view to promote and raise the standards of Corporate Governance,
SEBI revised claused 49 of the Listing agreement vide its circular
dated August 26, 2003, the implementation of which was deferred
later. The Securities and Exchange Board of India on October 29,
2004 again revised the Clause 49 of the Listing Agreement.
However, noticing that a large number of companies were still not
in the state of preparedness to be fully compliant with the requirements
of revised clause 49 of the listing agreement, SEBI allowed more
time to the corporates to conform to clause 49 of the listing agreement
and extended the date for ensuring compliance with the revised clause
49 of the listing agreement to December 31, 2005.
The text of Revised clause 49 as applicable to the listed companies
as on date is given below :
The company agrees to comply with the following provisions :
I. BOARD OF DIRECTORS
(A) Composition of Board
(i) The Board of directors of the compnay shall have an optimum
combination of executive and non-executive directors with not
less than fifty per cent of the board of directors comprising of
non-executive directors.
(ii) Where the Chairman of the Board is a non-executive director, at
least one-third of the Board should comprise of independent
directors and in case he is an executive director, at least half of
the Board should comprise of independent directors.
(iii) For the purpose of the sub-clause (ii), the expression
'independent director' shall mean a non-executive director of the
company who :
(a) apart from receiving director's remuneration, does not have
any material pecuniary relationships or transactions with
1. Compiled by Alka Kapoor, Dy. Director and Shikha Katoch, AEO , The ICSI.
2. Issued Vide Circular No. SEBI/CFD/DIL/CG/1/2004/12/10 dated October 29,
2004, amended till date.
Student Company Secretary
the company, its promoters, its directors, its senior
management or its holding company, its subsidiaries and
associates which may affect independence of the director;
(b) is not related to promoters or persons occupying
management positios at the board level or at one level below
the board;
(c) has not been an executive of the company in the immediately
preceding three financial years;
(d) is not a partner or an executive or was not partner or an
executive during the preceding three years, of any of the
following:
(i) the statutory audit firm or the internal audit firm that is
associated with the company, and
(ii) the legal firm(s) and consulting firm(s) that have a
material association with the company, .
(e) is not a material supplier, service provider or customer or a
lessor or lessee of the company, which may affect
independence of the director; and
(f) is not a substantial shareholder of the company i.e., owning
two per cent or more of the block of voting shares.
Explanation.-For the purposes of the sub-clause (iii) :
(a) Associate shall mean a company which is an "associate"
as defined in Accounting Standard (AS) 23, "Accounting
for Investments in Associates in Consolidated Financial
Statements", issued by the Institute of Chartered
Accountants of India.
(b) "Senior management" shall mean personnel of the company
who are members of its core management team excluding
Board of Directors. Normally, this would comprise all
members of management one level below the executive
directors, including all functional heads.
(c) "Relative" shall mean "relative" as defined in section 2(41)
and section 6 read with Schedule IA of the Companies Act,
1956.
(iv) Nominee directors appointed by an institution which has invested
in or lent to the company shall be deemed to be independent
directors.
Explanation.-" 'Institution' for this purpose means a public
financial institution as defined in section 4A of the Companies
Act, 1956 or a "corresponding new bank" as defined in section
2(d) of the Banking Companies (Acquisition and Transfer of
Undertakings) Act, 1970 or the Banking Companies (Acquisi-
tion and Transfer of Undertakings) Act, 1980 [both Acts]."
(B) Non-Executive Directors' Compensation and
Disclosures
All fees/compensation, if any paid to non-executive directors,
including independent directors, shall be fixed by the Board of Directors
and shall require previous approval of shareholders in general meeting.
The shareholders' resolution shall specify the limits for the maximum
number of stock options that can be granted to non-executive directors,
including independent directors, in any financial year and in aggregate.
Provided that the requirement of obtaining prior approval of
shareholders in general meeting shall not apply to payment of sitting
fees to non-executive directors, if made within the limits prescribed
under the Companies Act, 1956 for payment of sitting fees without
approval of the Central Govt.
(C) Other Provisions as to Board and Committees
(i) The board shall meet at least four times a year, with a maximum
time gap of four months between any two meetings. The minimum
information to be made available to the board is given in Annexure
IA.
(ii) A director shall not be a member in more than 10 committees or
act as Chairman of more than five committees across all
companies in which he is a director. Furthermore it should be a
mandatory annual requirement for every director to inform the
5 April 2006
 ACADEMIC GUIDANCE
company about the committee positions he occupies in other
companies and notify changes as and when they take place.
Explanation
1. For the purpose of considering the limit of the committees
on which a director can serve, all public limited companies,
whether listed or not, shall be included and all other
companies including private limited companies, foreign
companies and companies under section 25 of the
Companies Act shall be excluded.
2. For the purpose of reckoning the limit under this sub-clause,
Chairmanship/membership of the Audit Committee and the
Shareholders' Grievance Committee alone shall be
considered.
(iii) The Board shall periodically review compliance reports of all laws
applicable to the company, prepared by the company as well as
steps taken by the company to rectify instances of non-
compliances.
(D) Code of Conduct
(i) The Board shall lay down a code of conduct for all Board members
and senior management of the company. The code of conduct
shall be posted on the website of the company.
(ii) All Board members and senior management personnel shall
affirm compliance with the code on an annual basis. The Annual
Report of the company shall contain a declaration to this effect
signed by the CEO.
Explanation.-For this purpose, the term "senior management"
shall mean personnel of the company who are members of its
core management team excluding Board of Directors. Normally,
this would comprise all members of management one level below
the executive directors, including all functional heads.
II. AUDIT COMMITTEE
(A) Qualified and Independent Audit Committee
A qualified and independent audit committee shall be set up, giving
the terms of reference subject to the following:
(i) The audit committee shall have minimum three directors as
members. Two-thirds of the members of audit committee shall
be independent directors.
(ii) All members of audit committee shall be financially literate and
at least one member shall have accounting or related financial
management expertise.
Explanation 1:- The term "financially literate" means the abiIity
to read and understand basic financial statements, ie., balance
sheet, profit and loss account, and statement of cash flows.
Explanation 2 :-A member will be considered to have accounting
or related financial management expertise if he or she possesses
experience in finance or accounting, or requisite professional
certification in accounting, or any other comparable experience
or background which results in the individual's financial
sophistication, including being or havin'g been a chief executive
officer, chief financial officer or other senior officer with financial
oversight responsibilities.
(iii) The Chairman of the Audit Committee shall be an independent
director;
(iv) The Chairman of the Audit Committee shall be present at Annual
General Meeting to answer shareholder queries;
(v) The audit committee may invite such of the executives, as it
considers appropriate (and particularly the head of the finance
function) to be present at the meetings of the committee, but on
occasions it may also meet without the presence of any
executives of the company. The finance director, head of internal
audit and a representative of the statutory auditor may be present
as invitees for the meetings of the audit committee;
(vi) The Company Secretary shall act as the secretary to the
committee.
Student Company Secretary
(B) Meeting of Audit Committee
The audit committee should meet at least four times in a year and
not more than four months shall elapse between two meetings. The
quorum shall be either two members or one third of the members of
the audit committee whichever is greater, but there should be a
minimum of two independent members present.
(C) Powers of Audit Committee
The audit committee shall have powers, which should include the
following:
1. To investigate any activity within its terms of reference.
2. To seek information from any employee.
3. To obtain outside legal or other professional advice.
4. To secure attendance of outsiders with relevant expertise, if it
considers necessary.
(D) Role of Audit Committee
The role of the audit committee shall include the following:
1. Oversight of the company's financial reporting process and the
disclosure of its financial information to ensure that the financial
statement is correct, sufficient and credible.
2. Recommending to the Board, the appointment, re-appointment
and, if required, the replacement or removal of the statutory
auditor and the fixation of audit fees.
3. Approval of payment to statutory auditors for any other services
rendered by the statutory auditors.
4. Reviewing, with the manqgement, the annual financial statements
before submission to the board for approval, with particular
reference to :
(a) Matters required to be included in the Director's
Responsibility Statement to be included in the Board's report
in terms of clause (2AA) of section 217 of the Companies
Act, 1956
(b) Changes, if any, in accounting policies and practices and
reasons for the same
(c) Major accounting entries involving estimates based on the
exercise of judgment by management.
(d) Significant adjustments made in the financial statements
arising out of audit findings
(e) Compliance with listing and other legal requirements relating
to financial statements
(f) Disclosure of any related party transactions
(g) Qualifications in the draft audit report.
5. Reviewing, with the management, the quarterly financial
statements before submission to the board for approval.
6. Reviewing, with the management, performance of statutory and
internal auditors, adequacy of the internal control systems.
7. Reviewing the adequacy of internal audit function, if any, including
the structure of the internal audit department, staffing and
seniority of the official heading the department, reporting structure
coverage and frequency of internal audit.
8. Discussion with internal auditors any significant findings and
follow up there on.
9. Reviewing the findings of any internal investigations by the
internal auditors into matters where there is suspected fraud or
irregularity or a failure of internal control systems of a material
nature and reporting the matter to the board.
10. Discussion with statutory auditors before the audit commences,
about the nature and scope of audit as well as post-audit
discussion to ascertain any area of concern.
11. To look into the reasons for substantial defaults in the payment
to the depositors, debenture holders, shareholders (in case of
non-payment of declared dividends) and creditors.
6 April 2006
 ACADEMIC GUIDANCE
12. To review the functioning of the Whistle Blower mechanism, in
case the same is existing.
13. Carrying out any other function as is mentioned in the terms of
reference of the Audit Committee.
Explanation (i): The term "related party transactions" shall have
the same meaning as contained in the Accounting Standard 18,
Related Party Transactions, issued by , the Institute of Chartered
Accountants of India.
Explanation (ii) : If the company has set up an audit committee
pursuant to provisions of the Companies Act, the said audit
committee shall have such additional functions/features as is
contained in this clause.
(E) Review of information by Audit Committee
The Audit Committee shall mandatorily review the following
information:
1. Management discussion and analysis of financial condition and
results of operations;
2. Statement of significant related party transactions (as defined
by the audit committee), submitted by management;
3. Management letters/letters of internal control weaknesses issued
by the statutory auditors;
4. Internal audit reports relating to internal control weaknesses;
and
5. The appointment, removal and terms of remuneration of the Chief
internal auditor shall be subject to review by the Audit Committee.
III. SUBSIDIARY COMPANIES
(i) At least one independent director on the Board of Directors of
the holding company shall be a director on the Board of Directors
of a material non-listed Indian subsidiary company.
(ii) The Audit Cornmittee of the listed holding company shall also
review the financial statements, in particular, the investments
made by the unlisted subsidiary company.
(iii) The minutes of the Board meetings of the unlisted subsidiary
company shall be placed at the Board Meeting of the listed
holding company. The management should periodically bring to
the attention of the Board of Directors of the listed holding
company, a statement of all significant transactions and arrange-
ments entered into by the unlisted subsidiary company.
Explanation 1 : The term "material non-listed Indian subsidiary"
shall mean an unlisted subsidiary, incorporated in India, whose
turnover or net worth (i.e., paid up capital and free reserves)
exceeds 20% of the consolidated turnover or net worth
respectively, of the listed holding company and its subsidiaries
in the immediately preceding accounting year.
Explanation 2 : The term "significant transaction or arrangement"
shall mean any individual transaction or arrangement that
exceeds or is likely to exceed 10% of the total revenues or total
expenses or total assets or total liabilities, as the case may be,
of the material unlisted subsidiary for the immediately preceding
accounting year.
Explanation 3 : Where a listed holding company has a listed
subsidiary which is itself a holding company, the above provisions'
shall apply to the listed subsidiary insofar as its subsidiaries are
concerned.
IV. DISCLOSURES
(A) Basis of Related Party Transactions
(i) A statement in summary form of transactions with related parties
in the ordinary course of business shall be placed periodically
before the audit committee.
(ii) Details of material individual transactions with related parties
Student Company Secretary
which are not in the normal course of business shall be placed
before the audit committee.
(iii) Details of material individual transactions with related parties or
others, which are not on an arm's length basis should be placed
before the audit committee, together with Management's
justification for the same.
(B) Disclosure of Accounting Treatment
Where in the preparation of financial statements, a treatment
different from that prescribed in an Accounting Standard has been
followed, the fact shall be disclosed in the financial statements,
together with the management's explanation as to why it believes
such alternative treatment is more representative of the true and fair
view of the underlying business transaction in the Corporate
Governance Report.
(C) Board Disclosures Risk management
The company shall lay down procedures to inform Board members
about the risk assessment and minimization procedures. These
procedures shall be periodically reviewed to ensure that executive
management controls risk through means of a properly defined
framework.
(D) Proceeds from public issues, rights issues,
preferential issues etc.
When money is raised through an issue (public issues, rights
issues, preferential issues etc.), it shall disclose to the Audit
Committee, the uses/applications of funds by major category (capital
expenditure, sales and marketing, working capital, etc.) on a quarterly
basis as a part of their quarterly declaration of financial results. Further,
on an annual basis, the company shall prepare a statement of funds
utilized for purposes other than those stated in the offer document/
prospectus/notice and place it before the audit committee. Such
disclosure shall be made only till such time that the full money raised
through the issue has been fully spent. This statement shall be certified
by the statutory auditors of the company. The audit committee shall
make appropriate recommendations to the Board to take up steps in
this matter.
(E) Remuneration of Directors
(i) All pecuniary relationship or transactions of the non-executive
directors vis-a-vis the company shall be disclosed in the Annual
Report.
(ii) Further the following disclosures on the remuneration of directors
shall be made in the section on the corporate governance of the
Annual Report:
(a) All elements of remuneration package of individual directors
summarized under major groups, such as salary, benefits,
bonuses, stock options, pension etc.
(b) Details of fixed component and performance linked
incentives, along with the performance criteria.
(c) Service contracts, notice period, severance fees.
(d) Stock option details, if any - and whether issued at a discount
as well as the period over which accrued and over which
exercisable.
(iii) The company shall publish its criteria of making payments to
non-executive directors in its annual report. Alternatively, this
may be put up on the company's website and reference drawn
thereto in the annual report.
(iv) The company shall disclose the number of shares and convertible
instruments held by non-executive directors in the annual report.
(v) Non-executive directors shall be required to disclose their
shareholding (both own or held by/for other persons on a
beneficial basis) in the listed company in which they are proposed
to be appointed as directors, prior to their appointment. These
details should be disclosed in the notice to the general meeting
called for appointment of such director.
7 April 2006
 ACADEMIC GUIDANCE
(F) Management
(i) As part of the directors' report or as an addition thereto, a
Management Discussion and Analysis report should form part
of the Annual Report to the shareholders. This Management
Discussion & Analysis should include discussion on the following
matters within the limits set by the company's competitive
position:
(i) Industry structure and developments.
(ii) Opportunities and threats.
(iii) Segment-wise or product-wise performance.
(iv) Outlook.
(v) Risks and concerns.
(vi) Internal control systems and their adequacy.
(vii) Discussion on financial performance with respect to
operational performance.
(viii) Material developments in Human Resources/Industrial
Relations front, including number of people employed.
(ii) Senior management shall make disclosures to the board relating
to all material financial and commercial transactions, where they
have personal interest, that may have a potential conflict with
the interest of the company at large (for e.g. dealing in company
shares, commercial dealings with bodies, which have
shareholding of management and their relatives etc.)
Explanation : for this purpose, the term "senior management"
shall mean personnel of the company who are members of its
core management team excluding the Board of Directors. This
would also include all members of management one level below
the executive directors including all functional heads.
(G) Shareholders
(i) In case of the appointment of a new director or re-appointment
of a director the shareholders must be provided with the following
information:
(a) A brief resume of the director;
(b) Nature of his expertise in specific functional areas;
(c) Names of companies in which the person also holds the
directorship and the membership of Committees of the
Board; and
(d) Shareholding of non-executive directors as stated in Clause
49(1V)(E)(v) above.
(ii) Quarterly results and presentations made by the company to
analysts shall be put on company's web-site, or shall be sent in
such a form so as to enable the stock exchange on which the
company is listed to put it on its own web-site.
(iii) A board committee under the chairmanship of a non-executive
director shall be formed to specifically look into the redressal of
shareholder and investors complaints like transfer of shares,
non-receipt of balance sheet, non-receipt of declared dividends
etc. This Committee shall be designated as 'Shareholders/
Investors Grievance Committee'.
(iv) To expedite the process of share transfers, the Board of the
company shall delegate the power of share transfer to an officer
or a committee or to the registrar and share transfer agents. The
delegated authority shall attend to share transfer formalities at
least once in a fortnight.
V. CEO/CFO CERTIFICATION
The CEO, i.e., the Managing Director or Manager appointed in
terms of the Companies Act, 1956 and the CFO i.e., the whole-
time Finance Director or any other person heading the finance
function discharging that function shall certify to the Board that:
(a) They have reviewed financial statements and the cash flow
statement for the year and that to the best of their knowledge
and belief:
(i) these statements do not contain any materially untrue
statement or omit any material fact or contain
statements that might be misleading;
Student Company Secretary
(ii) these statements together present a true and fair view
of the company's affairs and are in compliance with
existing accounting standards, applicable laws and
regulations.
(b) There are, to the best of their knowledge and belief, no
transactions entered into by the company during the year
which are fraudulent, illegal or violative of the company's
code of conduct.
(c) They accept responsibility for establishing and maintaining
internal controls for financial reporting and that they have
evaluated the effectiveness of internal control systems of
the company pertaining to financial reporting and they have
disclosed to the auditors and the Audit Committee,
deficiencies in the design or operation of internal controls,
if any, of which they are aware and the steps they have
taken or propose to take to rectify these deficiencies.
(d) They have indicated to the auditors and the Audit committee:
(i) significant changes in internal control over financial
reporting during the year;
(ii) significant changes in accounting policies during the
year and that the same have been disclosed in the notes
to the financial statements; and
(iii) instances of significant fraud of which they have become
aware and the involvement therein, if any, of the
management or an employee having a significant role
in the company's internal control system over
financial reporting.
VI. REPORT ON CORPORATE GOVERNANCE
(i) There shall be a separate section on Corporate Governance
in the Annual Reports of company, with a detailed
compliance report on Corporate Governance. Non-
compliance of any mandatory requirement of this clause
with reasons thereof and the extent to which the non-
mandatory requirements have been adopted should be
specifically highlighted. The suggested list of items to be
included in this report is given in Annexure-IC and list of
non-mandatory requirements is given in Annexure-ID.]
(ii) The companies shall submit a quarterly compliance report
to the stock exchanges within 15 days from the close of
quarter as per the format given in Annexure lB. The report
shall be signed either by the Compliance Officer or the Chief
Executive Officer of the company.
VII. COMPLIANCE
(1) The company shall obtain a certificate from either the
auditors or practising company secretaries regarding
compliance of conditions of corporate governance as
stipulated in this clause and annex the certificate with the
directors' report, which is sent annually to all the sharehold-
ers of the company. The same certificate shall also be sent
to the Stock Exchanges along with the annual report filed
by the company.
(2) The non-mandatory requirements given in Annexure-ID may
be implemented as per the discretion of the company.
However, the disclosures of the compliance with mandatory
requirements and adoption (and compliance)/non-adoption
of the non-mandatory requirements shall be made in the
section on corporate governance of the Annual Report.
Annexure IA
Information to be placed before Board of Directors
1. Annual operating plans and budgets and any updates.
2. Capital budgets and any updates.
3. Quarterly results for the company and its operating divisions or
business segments.
8 April 2006
 ACADEMIC GUIDANCE
4. Minutes of meetings of audit committee and other committees III. Subsidiary Companies 49(III)
of the board.
IV. Disclosures 49(IV)
5. The information on recruitment and remuneration of senior
officers just below the board level, including appointment or (A)Basis of related party 49(IV A)
removal of Chief Financial Officer and the Company Secretary. transactions
6. Show cause, demand, prosecution notices and penalty notices (B)Board Disclosures 49(IVB)
which are materially important.
(C)Proceeds from public 49(lVC)
7. Fatal or serious accidents, dangerous occurrences, any material issues,rights issues,
effluent or pollution problems. preferential issues etc.
8. Any material default in financial obligations to and by the (D)Remuneration of Directors 49(IVD)
company, or substantial non-payment for goods sold by the
company. (E)Management 49(IVE)
9. Any issue, which involves possible public or product liability (F) Shareholders 49(IVF)
claims of substantial nature, including any judgement or order V. CEO/CFO Certification 49(V)
which, may have passed strictures on thc conduct of the company
or taken an adverse view regarding another enterprise that can VI. Report on Corporate 49(VI)
have negative implications on the company. Governance
10. Details of any joint venture or collaboration agreement. VII.Compliance 49(VII)
11. Transactions that involve substantial payment towards goodwill, Note
brand equity, or intellectual property. (1) The details under each head shall be provided to incorporate all
12. Significant labour problems and their proposed solutions. Any the information required as per the provisions of the Clause 49
significant development in Human Resources/Industrial Relations of the Listing Agreement.
front like singing of wage agreement, implementation of Voluntary (2) In the column No.3, compliance or non-compliance may be
Retirement Scheme etc. indicated by Yes/ No/N.A. For example, if the Board has been
13. Sale of material nature, of investments, subsidiaries, assets, composed in accordance with the Clause 49-I of the Listing
which is not in normal course of business. Agreement, "Yes" may be indicated. Similarly, in case " the
company has no related party transactions, the words "N.A."
14. Quarterly details of foreign exchange exposures and the steps may be indicated against 49 (IV A).
taken by management to limit the risks of adverse exchange
(3) In the remarks column, reasons for non-compliance may be
rate movement, if material.
indicated for example, in case of requirement related to circulation
15. Non-compliance of any regulatory, statutory or listing of information to the shareholders, which would be done only in
requirements and shareholders service such as non-payment the AGM/EGM, it might be indicated in the "Remarks" column
of dividend, delay in share transfer etc. as - "will be complied with at the AGM". Similarly, in respect of
Annexure IB matters which can be complied with only where the situation
arises, for example, "Report on Corporate Governance" is to be
FORMAT OF QUARTERLY COMPLIANCE REPORT ON a part of Annual Report only, the words "will be complied in the
CORPORATE GOVERNANCE next Annual Report" may be indicated.
Name of the Company: Annexure IC
Quarter ending on :
Suggested list of items to be included in the Report
Particulars Clause of Compli- Remarks on Corporate Governance in the Annual Report of
Listing ance Companies
Agreement status
Yes/No 1. A brief statement of company's philosophy on code of
governance.
I. Board of Directors 49I
2. Board of Directors
(A) Composition of Board 49(IA) (i) Composition and category of directors, for example,
(B)Non-executive Directors 49(IB) promoter, executive, non-executive, independent non-
compensation & disclosures executive, nominee director, which institution represented
as lender or as equity investor.
(C)Other provisions as to 49(IC) (ii) Attendance of each director at the Board meetings and the
Board and Committees last AGM.
(D) Code of Conduct 49(ID) (iii) Number of other Boards or Board Committees in which he/
she is a member or Chairperson.
II. Audit Committee 49(II) (iv) Number of Board meetings held, dates on which held.
(A)Qualified & Independent 49(IIA) 3. Audit Committee
Audit Committee (i) Brief description of terms of reference
(B)Meeting of Audit 49(IIB) (ii) Composition, name of members and Chairperson
Committee (iii) Meetings and attendance during the year
(C)Powers of Audit Committee 49(IIC) 4. Remuneration Committee
(i) Brief description of terms of reference
(D)Role of Audit Committee 49(IID) (ii) Composition, name of members and Chairperson
(E)Review of Information by 49(IIE) (iii) Attendance during the year
Audit Committee (iv) Details of remuneration to all the directors, as per format in
main report.

Student Company Secretary 9 April 2006

 ACADEMIC GUIDANCE
5. Shareholders Committee terms of reference, the company's policy on specific remuneration
(i) Name of non-executive director heading the committee packages for executive directors including pension rights and
(ii) Name and designation of compliance officer any compensation payment.
(iii) Number of shareholders' complaints received so far (ii) To avoid conflicts of interest, the remuneration committee, which
(iv) Number not solved to the satisfaction of shareholders would determine the remuneration packages of the executive
(v) Number of pending complaints directors may comprise of at least three directors, all of whom
6. General Body meetings should be non-executive directors, the Chairman of committee
(i) Location and time, where last three AGMs held being an independent director.
(ii) Whether any special resolutions passed in the previous (iii) All the members of the remuneration committee could be present
3 AGMs at the meeting.
(iii) Whether any special resolution passed last year through
postal ballot-details of voting pattern (iv) The Chairman of the remuneration committee could be present
(iv) Person who conducted the postal ballot exercise at the Annual General Meeting, to answer the shareholder
(v) Whether any special resolution is proposed to be conducted queries. However, it would be up to the Chairman to decide who
through postal ballot should answer the queries.
(vi) Procedure for postal ballot (3) Shareholder Rights
7. Disclosures A half-yearly declaration of financial performance including
(i) Disclosures on materially significant related party summary of the significant events in last six-months, may be sent to
transactions that may have potential conflict with the each household of shareholders.
interests of company at large.
(ii) Details of non-compliance by the company, penalties, (4) Audit qualifications
strictures imposed on the company by Stock Exchange or Company may move towards a regime of unqualified financial
SEBI or any statutory authority, on any matter related to statements.
capital markets, during the last three years. (5) Training of Board Members
(iii) Whistle Blower policy and affirmation that no personnel has
been denied access to the audit committee. A company may train its Board members in the business model
(iv) Details of compliance with mandatory requirements and of the company as well as the risk profile of the business parameters
adoption of the non-mandatory requirements of this clause. of the company, their responsibilities as directors, and the best ways
to discharge them.
8. Means of communication
(i) Quarterly results (6) Mechanism for evaluating non-executive Board Members
(ii) Newspapers wherein results normally published The performance evaluation of non-executive directors could be
(iii) Any website, where displayed done by a peer group comprising the entire Board of Directors,
(iv) Whether it also displays official news releases; and excluding the director being evaluated; and Peer Group evaluation
(v) The presentations made to institutional investors or to the could be mechanism to determine whether to extend/ continue the
analysts. terms of appointment of non-executive directors.
9. General Shareholder information (7) Whistle Blower Policy
(i) AGM: Date, time and venue
(ii) Financial year The company may establish a mechanism for employees to report
(iii) Date of Book closure to the management concerns about unethical behaviour, actual or
(iv) Dividend Payment Date suspected fraud or violation of the company's code of conduct or
(v) Listing on Stock Exchanges ethics policy. This mechanism could also provide for adequate
(vi) Stock Code safeguards against victimization of employees who avail of the
(vii) Market Price Data: High, Low during each month in last mechanism and also provide for direct access to the Chairman of the
financial year Audit Committee in exceptional cases. Once established, the
(viii) Performance in comparison to broad-based indices such existence of the mechanism may be appropriately communicated
as BSE Sensex, CRISIL index etc. within the organization.
(ix) Registrar and Transfer Agents
(x) Share Transfer System 4. INITIA TIVES ON COMP
INITIATIVES ANY LA
COMPANY W
LAW
(xi) Distribution of shareholding 3
(xii) Dematerialization of shares and liquidity
REFORMS
(xiii) Outstanding GDRs/ ADRs/Warrants or any Convertible To frame a law that enables companies to achieve global
instruments, conversion date and likely impact on equity competitiveness in the fast changing corporate scenario, the
(xiv) Plant Locations Government has taken a fresh exercise for a comprehensive revision
(xv) Address for correspondence of the Companies Act, 1956 albeit through a consultative process.
Annexure ID As a first step in this direction, a Concept Paper on Company law
drawn up in the legislative format was exposed to public in August
NON-MANDATORY REQUIREMENTS 2004 so that all interested may not only express their opinion on the
(1) The Board concepts involved but may also suggest formulations on various
aspects of Company Law.
A non-executive Chairman may be entitled to maintain a
Chairman's office at the company's expense and also allowed The response to the concept paper on Company Law was
reimbursement of expenses incurred in performance of his duties. tremendous. The Government, therefore, felt it appropriate that the
Independent Directors may have a tenure not exceeding, in the proposals contained in the Concept Paper and suggestions received
aggregate, a period of nine years, on the Board of a company. thereon be put to merited evaluation by an Independent Expert
Committee. A Committee was constituted on 2nd December, 2004
(2) Remuneration Committee under the Chairmanship of Dr. J.J. Irani, Director, Tata Sons, with the
(i) The board may set up a remuneration committee to determine
on their behalf and on behalf of the shareholders with agreed 3. Prepared by Alka Kapoor, Dy. Director, the ICSI.

Student Company Secretary 10 April 2006

 ACADEMIC GUIDANCE
task of advising the Government on the proposed revision of the
Companies Act, 1956. The objective of such revision was to have a
simplified compact law that will be able to address the changes taking
place in the national and international scenario, enable adoption of
internationally accepted best practices as well as provide adequate
flexibility for timely evolution of new arrangements in response to the
requirements of ever-changing business models.
A. HIGHLIGHTS OF CONCEPT PAPER (CP)
I. Objectives
1. To bring the corporate law in consonance with the changes that
have occurred in the ecnomic development;
2. To delete the redundant provisions and to regroup the scattered
provisions relating to specific subjects;
3. To condense, simplify and rationalize the provisions of company
law;
4. To de-link the procedural aspects from the substantive law;
5. To give an overview of the form of the re-codified Companies Bill
containing only 289 sections and a few schedules, in place of
existing 781 section and 15 schedules.
II. Officer in Default
The definition of term 'Officer' who is in default is proposed to be
amended to include the following additional persons :
(i) every employee who is in receipt of remuneration more than
remuneration drawn by the Managing Director or any Whole-
time director in the company and who himself or along with his
spouse or dependent children holds not less than two per cent
of the equity share capital of the company.
(ii) any other director in respect of contravention of any of the
provisions of this Act which had taken place with his consent or
connivance or is attributable to any neglect on his part.
(iii) the Chief Accounts Officer in respect of offences for which he is
specifically punishable.
(iv) the share transfer agents, bankers in respect of the issue or
transfer of any secrurities of the company.
III. Emergency Meeting of Board Without Notice
Provision is made for holding of emergency meeting without notice
with consent of majority of directors.
IV. Meeting Through Video Conferencing
Board meetings are allowed to be held by video conferenecing
subject to the condition that minutes should be signed, by all directors
who participated, within three months of the meeting.
V. Accounts
It is proposed to change the existing definition of Books of Account
provided under Section 209(1) to provide that Central Government
may prescribe any other records as 'Books of Accounts'. This is a
new addition.
It is proposed to enlarge the definition of "book and paper" and
'book or paper' by addition of words minutes, registers and
maintenance of records on electronic mode [Clause 2(9)].
VI. HoldingSubsidiary Companies
The definition of the term 'Holding Company' is proposed to be
amended to provide that a subsidiary of another company cannot
become holding company. This proposal was contained in the
Companies (Amendment) Bill, 2003. However, a company which is
subsidiary of another company may become a holding company of a
body corporate incorporated outside India [Clause 2(38)].
The CP proposes to disable companies to have a pyramid structure
through multiple linear subsidiaries.
VII. Penalties
To deter non-compliance, the CP has increased the amount of
Student Company Secretary
penalties for various offences substantially. Making the law simple to
understand and non-compliance very tough will ensure a new ethos
of legal compliance and adherence in the Indian corporate sector. In
Companies Act, 1956, Penalties for default committed under different
Sections are scattered all over the Act. However the CP containts a
spearate schedule listing specific penalties in respect of each violation
under various provisions of the Act.
VIII. Delegation of Powers
The concept paper proposes to enhance the scope of delegation
of powers to the Central Govt. enabling it to frame rules in respect of
many sections. This is bound to make the provisions flexible in their
applicability. This will also enable the Govt. to effect changes as per
the prevailing facts and circumstances without recourse to the tardy
and extremely time consuming process of making suitable
amendments to the Act in the Parliament. Some of the important
provisions where this kind of power to frame rules is delegated are
with regard to : Independent Directors; Small shareholders; Format
and contents of Memorandum & Articles of Association; Alteration of
Memorandum of Association; Registered officer; Manner of usage of
the common seal; Manner of service of documents; Application of
share premium; Preferential allotment of shares under section 81;
ESOP/ESOS; General Meeting on requisition; Ordinary and Special
Resolutions; Postal Ballot; Minutes of Board and General meetings;
Qualification and disqualification of directors; Role and composition
of the Audit committee; Retirement of Directors by rotation; Number
of Directorships; Restrictions on the powers of the Board; Disclosure
of interest by directors; Prohibition on voting and participating in
discussions by interested directors; Managerial remuneration.
IX. E-Filing of Applications/Returns
The concept paper proposes to make the Act I.T. savvy by giving
recognition to electronic records/minutes/Registers etc. The concept
paper has also provided for electronic filing of applications/Returns
etc. with the Govt. bodies. This will ensure minimum wastage of paper
thereby saving the natural resources of the country and also ensuring
quicker action in compliance besides saving of man hours. This will
also result in optimum space utilization.
X. De-Regulation
The Concept Paper proposes to foster de-regulation and self
regulation by excluding the need for Central Govt's approval in respect
of appointment of sole selling agents and appointment of cost auditors.
XI. Subsidiary Companies
The Concept Paper seeks to prevent diversion of public and
institutional funds from a holding company to its subsidiary companies
by imposing a restriction on creation of a subsidiary by an existing
subsidiary of the holding company.
XII.Investor Protection
The Concept Paper proposes to facilitate better investor protection
by virtue of the following measures :-
l The Chief Accounts Officer has been made an 'officer in default'
in respect of offences with respect to disclosures in offer
documents/prospectus. Further even share transfer agents have
been classified as officers in default if they fail to comply with
the requirements relating to the investors.
l Enhancement of the penalties on companies and their officers
in default for the violation of provisions of the Act relating to
investor.
l The amount of shareholding to qualify as 'small shareholders' or
the amount of deposit to qualify as a 'small depositor' shall be
prescribed by Rules to be issued by the Central Govt. At present
the amount is Rs. 20000/- or less (in both the cases). The
proposed provisions will ensure flexibility in fixing the said limits
as per the prevailing circumstances.
l It is proposed to withdraw the exemption from criminal liability
11 April 2006
 ACADEMIC GUIDANCE
for an expert in respect of mis-statements or omission of
important facts in the prospects. Further in event of any loss or
damage caused to any investor by virtue of any fraudulent acts
the civil liability accruing to the directors, promoters and persons
who authroized the issue of prospectus, shall be unlimited.
l Companies can hold their AGMs on public holidays and during
non office hours.
l If the interest of any director or any manager is not fully and
adequately disclosed in the Explanatory Statement attached to
the notice of a general meeting then he will have to re-imburse
or return the entire benefit to the company.
l Distribution of gifts at AGMs would be banned so as to ensure
that wily promoters and directors do not try to divert the
shareholders attention.
B. DR. J J IRANI COMMITTEE REPORT ON
COMPANY LAW
Dr. J J Irani Expert Committee on Company Law has submitted
its report charting out the road map for a flexible, dynamic and user-
friendly new company law. The Committee has taken a pragmatic
approach keeping in view the ground realities, and has sought to
address the concerns of all the stakeholders to enable adoption of
internationally accepted best practices. Be it the role of directors in
the management of the company or the role of promoters at the time
of incorporation or the responsibility of professionals in ensuring better
governance, the report has made very dynamic and balanced
recommendations. The Report of the Committee has also sought to
bring in multifarious progressive and visionary concepts and
endeavored a significant shift from the "Government Approval Regime"
to "Shareholder Approval and Disclosure Regime".
The Expert Committee has recommended that private and small
companies need to be given flexibilities and freedom of operations
and compliance at low cost. Companies with higher public interest
which access capital from public need to be subjected to a more
stricter regime of Corporate Governance. Further, Government
companies and public financial institutions be subject to similar
parameters with respect to disclosures and Corporate Governance
as other companies are subjected to.
HIGHLIGHTS OF DR. J.J. IRANI COMMITTEE REPORT
Classification and Registration of Companies
l Concepts of small company and one person company be added.
l Small Companies should be subjected to a less stringent
regulatory framework.
l Simplified dispute resolution procedure for resolving disputes
amongst members of private companies may be promulgated.
l Government companies to be treated at par with other companies
in application of law.
l Non-commercial/commercially unviable social responsibilities
imposed on government companies to be transparently
assessed.
l No restriction on multilayer subsidiaries. Misuse of multilayer
subsidiaries to be prevented by transparent Board processes
and disclosures under close supervision of regulator for listed
companies.
l Recognition to arrangements between joint venture partners or
two or more substantial shareholders be provided for in company
law.
l Concept of PFls to be reviewed and may be deleted, with suitable
transitory provisions. Such institutions to be put through similar
requirements of financial and management prudence as other Fls.
l Registration process to be speedy and compatible with
e-governance.
Student Company Secretary
l Detailed, updated and authenticated disclosures about
promoters, directors to be made by the company at the time of
incorporation.
l Companies to register their websites and e-mail addresses.
l E-governance system to be cost effective and accessible to all
companies, including small and one person companies. Suitable
e-forms to be devised and e-filings to be secured by digital
signatures.
l Concept of single national registry to be recognised.
l Name allotment to be made simpler through automatic
e-systems.
l Issue of a Certificate of Commencement of business may be
dispensed with.
l Formation of LLPs to be encouraged. A separate Act be brought
about to facilitate limited liability partnerships.
l Introduction of a separate Act to regulate producer companies
may be considered.
Management and Board Governance
l No limit to be laid on the maximum numbers of directors, such
decision to be left to shareholders.
l Every Company to have at least one director resident in India.
l No Government intervention in the process of appointment and
removal of Directors in non-Government companies.
l Obtaining the Central Government's approval under the
Companies Act for appointment of non-resident managerial
personnel be done away with.
l No age limit for directors need be prescribed in law. Adequate
disclosure of age to be in the company's documents.
l In first instance, requirement of ID's be extended to public listed
companies and companies accepting public deposits.
l Irrespective of whether the Chairman is executive or non-
executive, independent or not, a minimum of one third of the
total number of directors as independent directors, considered
adequate.
l Nominee directors appointed by any institution or in pursuance
of any agreement or Government appointees representing
Government shareholding not to be deemed as independent
directors.
l No requirement to be there for a subsidiary company to
necessarily co-opt an independent director of the holding
company as an independent director on its board.
l Number of Directorships any one individual may hold including
alternate directorships should be limited to a maximum of 15.
l Only an independent director to be appointed as alternate director
to an independent director.
l Need for comprehensive revision of provisions of the Companies
Act relating to payment of managerial remuneration. No quantified
limits need to be prescribed.
l Relationship to be there between responsibility and performance
vis-a-vis remuneration.
l Shareholders to approve managerial remuneration. Government
approvals to be done away with.
l Recommendations of Remuneration committee to be considered.
l Disclose the Directors'/Managerial remuneration in the Directors'
Remuneration Report.
l Company to decide remuneration of non-executive directors
including independent directors.
l It may be in the form of sitting fees for Board and committee
meetings attended physically or participated in electronically and/
or Profit related commissions.
12 April 2006
 ACADEMIC GUIDANCE
l Following Board Committees to be mandatory in respect of certain
companies:
Audit Committee for Accounting and Financial matters
Stakeholders Relationship Committee
Remuneration Committee
l Law to include certain duties of directors with civil consequences
for non performance.
l Failure to attend Board meetings for a continuous period of one
year to be a ground for vacation of office by director regardless
of leave of absence being given by the Board.
l Copy of resignation letter to be forwarded by the director within
the prescribed time to ROC alongwith proof of delivery to the
company. Company also to file such information with ROC within
a prescribed period. No requirement of formal acceptance of
resignation by the company.
l Promoters of every company to be identified at the time of
incorporation and in annual return.
l Responsibilities to be placed on directors of companies coming
out with public issues so as to prevent diversion of funds by
them. Such companies to preserve composition of Board for
two years or till the procured funds are utilized in accordance
with objectives stated in prospectus, whichever is earlier. In case
a director resigns, his liability under the prospectus (including
for utilization of funds) to continue for the aforesaid period.
l Companies and their key directors/officers may mitigate potential
personal liability by D&O Insurance.
l Insurance premium paid by the company, not to be treated as a
perquisite or income in the hands of a director.
l Companies can hold AGM at any place (in India) other than its
Registered Office, if atleast 10% members reside at such place.
l One buy-back offer by the company to be mandated within a
period of 3 years of its delisting from all stock exchanges.
l Following Key Managerial Personnel identified for all companies:
Chief Executive Officer (CEO)/Managing Director.
Company Secretary (CS)
Chief Finance Officer (CFO)
l Appointment and removal of key managerial personnel to be
done by the Board.
l Small companies may be exempted from appointing such
personnel on whole time basis, and alternatively services may
be obtained by them from qualified practising professionals.
Related Party Transactions
l Transactions/contracts in which directors or their relatives are
interested to be regulated through a "Shareholder Approval and
Disclosure-based regime" and not through a "Government
Approval-based regime" .
l Directors' Responsibility Statement to include an additional clause
to the effect that every director has made relevant disclosures
for the purposes of ascertaining related party transactions.
l Details of transactions of the Company with its Holding or
Subsidiary/Fellow Subsidiary or Associate Companies
transactions on an arms length basis to be placed
periodically before the Board through the Audit Committee.
transactions not on an arms length basis to be placed before
the Board together with its Management justification. A
summary of such transactions with each party to form part
of the Annual Report.
Minority Interests
l Specific Minority Shareholders' group be represented on the
Boards of companies for facilitating investor protection.
Student Company Secretary
l Law to indicate, in clear terms, the rights of members of the
company to get all information to which they are entitled, in a
timely manner.
l Financial information and disclosures provided to the
shareholders should not be in excessively technical format. They
should be simple to understand.
l Extensive use of postal ballot including electronic media be made
enabling shareholders to participate in meetings and decision
making.
l Introduction of principle of valuation of shares of a company
through an independent valuation mechanism.
l Independent valuer to be appointed by Audit Committee where
mandated, or by the Board.
l A company that has delisted from all the Stock Exchanges in
India and has a shareholder/depositor base of 1000 or more
should be mandated to give one buy-back offer within a period
of three years of delisting.
l Recognition of the principles of derivative actions and Class/
Representative actions as have been upheld by courts on many
occasions to check fraud on the minority by wrongdoers, who
are in control and who prevent the company from bringing an
action in its own name.
Investor Education and Protection
l Companies accepting public deposits should be required to:-
t Appoint independent directors;
t Appoint audit/remuneration/stakeholders relationship
committees;
t Undertake deposit insurance;
t Undertake credit rating;
t Be subjected to stringent disclosures monitoring and
stringent penalties for irresponsible/fraudulent behaviour.
l Provisions for compensation to investors in established cases
of fraud, to be incorporated.
l Investors to have option to approach consumer courts to redress
their complaints of shares and securities (legally deemed as
'goods' under Consumer Protection Act, 1988).
l Procedure for making claims to be simplified.
l Court ordered refunds to be made from the funds available with
IEPF.
Access to Capital
l Suitable criteria for identifying Well Known Seasoned Issuers
(WKSI) be evolved by SEBI in respect of corporates, raising
capital more frequently. WKSI may be allowed to provide a main
document in a year and thereafter at any time of market access
during the currency of shelf-prospectus, only incremental
changes to be reported by them.
l Offer made to 50 or more persons is deemed to be a Public
Offer. Qualified Institutional Buyers (QIBs) be excluded in
reckoning the limit of 50 or more persons.
l Special category of shares may be issued termed as 'Tracking
Shares". Tracking shares to confer on the holders thereof a right
to participate in the dividend declared by the company, as
recommended by the Board from the profits, of that particular
division.
l Introduction of mechanism of buy back of shares from a subset
of shareholders on a preferential basis is not appropriate at this
stage.
l Companies be permitted to issue perpetual/longer duration
preference shares.
l For premature redemption of preference shares enabling
13 April 2006
 ACADEMIC GUIDANCE
provisions for redemption upto certain percentage on an annual
basis may be provided. This may be done through "call/put option
mechanism".
l Public company not to allot shares as fully or partly paid-up
otherwise than in cash, unless the consideration is independently
valued.
l Valuer to be appointed by the company in consultation with the
allottee and valuation to be made known to the allottee and the
concerned Regulator.
l Prohibition on companies from making loans to stock brokers
and stock broking firm/stock broking companies subject to the
exemptions presently provided under Section 372A of the Act.
Approval for the above to be accorded by way of special resolution
instead of Government.
l In public unlisted companies, preferential allotment to be made
on the basis of valuation by an independent valuer.
l Section 208 to be deleted from the provisions of the Companies
Act as it has outlived the purpose for which it was introduced as
corporates are today resorting to finances available at market
driven rates of interest.
Accounts and Audit
l Consolidation of financial statements of subsidiaries with those
of holding companies be made mandatory.
l Attaching of accounts of subsidiary companies with the holding
companies, should be done away with.
l Financial statements of a foreign subsidiary, required to be
furnished to the shareholders of the holding company, be
accepted in the same format and currency in which these were
prepared as per laws of the relevant country.
l The definition of term 'financial statement' be laid down in the
Act and should include Profit & Loss Account, Balance-sheet,
Cash Flow Statement and Notes on Account.
l First Financial year to begin from the date of incorporation and
end on the immediately succeeding 31st March and subsequent
Financial Years also to end on 31st March every year.
l Definition of 'Financial Year' be modified to indicate that the
duration of first financial year should be minimum three months
instead of the six months proposed in the Concept Paper.
l Appointment of CFO should be recognized under the Act and
CFO be made responsible for preparation and submission of
financial statements to the Board.
l Financial statements also to be signed by MD, CEO, CFO and
Company Secretary.
l Directors' Responsibility Statement to mention that the related
party transactions have been entered into at arm's length and if
not, the relationships of the directors in such transactions along
with the amounts involved have been disclosed as a part of
Director's Report along with management justification thereof.
l Two sets of existing rules relating to declaration of dividend out
of reserves and transfer of profit to reserve, be deleted.
l No restriction on writing off 95% of the original cost to the
company of the asset over a specified period, on the Central
Government in approving the basis of providing depreciation.
l Internal controls as mandated by the company with the approval
of Audit Committee, if any, be certified by CEO and CFO of the
company and in Directors' Report through a separate statement
on the assessment.
l All matters relating to appointment of auditors, examination of
the auditor's report along with financial statements prior to
consideration and approval by the Board, related party
transactions, valuations and other matters involving conflict of
interest to be referred to the Board only through Audit Committee.
Student Company Secretary
l Government approval for appointment of Cost Auditor for carrying
out Cost Audit not considered necessary.
Mergers and Acquisitions
l Contractual mergers be given statutory recognition in company law.
l Single forum to approve the scheme of mergers and acquisitions
in an effective time bound manner.
l Concept of 'deemed approval' to be provided for in cases where
the regulators do not furnish their comments within a specified
time period to the Court/Tribunal.
l Valuation to be carried out by independent registered valuers
rather than by Court appointed valuers.
l Valuation standards may be developed on the lines of
International Valuation Standards.
l Audit Committee where mandated to verify the independence of
the valuer for the purposes of an independent valuation.
Otherwise the Board to carry out this task.
l Separate electronic registry to be constituted for filing schemes
under Sections 391/394 of the Companies Act.
l Need for uniformity and overall reduction of stamp duties
applicable for mergers, demergers, amalgamations or schemes
of reconstruction, takeover.
l Less regulation in respect of mergers among associate
companies/two private limited companies where no public interest
is involved.
l A Non obstante provision to be introduced to ensure that the
assets and liabilities of transferor company absolutely vest in
the transfree company notwithstanding anything to the contrary
in any other law.
Investigation
l Instead of separate provisions for both inspection and
investigation under the Act, a single comprehensive process of
investigation to be formulated.
l System of oversight through random scrutiny of the filings of
documents be adopted.
l Government may appoint any officer of Government, any private
professional or group/firm of professionals as inspector for
investigation.
l Inspector/Investigator/his partner not to have material interest
in the company or its holding subsidiary.
l Presence of SFIO be recognised in the Companies Act. Officers
of the SFIO may also be authorised to file complaints for offences
under Criminal Procedure Code in addition to offences under
the Companies Act.
Offences and Penalties
l Law to encourage compliance through self-regulation.
l Penalties on companies to relate to the size of the company in
addition to the nature of offence.
l In investigation/prosecution of directors, statutory notices should
be issued only to Whole Time Directors. Non-whole Time
Directors may be asked to explain after applying attributability
or 'knowledge' test.
l The professionals such as accountants, the auditors, lawyers,
company secretaries advising companies on various matters also
to be held liable for wrong doing.
l Penalties to be classified in the form of schedules specifying
with relation to a given section, the nature of offence, the
prosecution mode and daily default fine, where applicable.
l Provision be made for publication of information relating to
convictions for criminal breaches of Companies Act on the part
of the company or its officers or key employees in the Annual
Report.
14 April 2006
 ACADEMIC GUIDANCE
l To enable speedy imposition of penalties for criminal offences,
specified benches of the NCLT may be vested with criminal
jurisdiction.
l The issue of "Phoenix companies" be addressed through a
combination of disclosures, insolvency processes and
disqualification of delinquent directors.
Restructuring and Liquidation
l Rehabilitation and liquidation processes to be time bound.
l Setting up of institutional structure in the form of NCLT/NCLAT
for overseeing such processes.
l Winding up to be resorted to only when revival is not feasible.
Reasonable opportunity for rehabilitation of business be given
before it is decided to be liquidated.
l Period of one year to be adequate for rehabilitation from
commencement of process to sanction of plan.
l Two years to be feasible for completion of liquidation.
l Companies to convene a General Meeting without delay where
losses in financial year are equal to 25% or more of its average
net worth during last two financial years and there is a default in
making payments to the creditors.
l Full control of assets may be allowed to pass to administrator
nominated by creditors through exercise of right of substitution
where circumstance justifies.
l Role of operating agency envisaged under the existing law should
be performed by independent Administrator or such other
qualified professional.
l Creditors to actively participate and monitor the insolvency
process.
l Panel of Administrators and Liquidators to be prepared and
maintained by an independent body of professionals with
appropriate experience and knowledge of insolvency practice.
Panel to be of individual professionals rather than firms.
l Tribunal to appoint Administrator and Liquidators out of the panel
maintained by the independent body and Official Liquidators from
panel of officials made available by the Government.
l A flexible but transparent system for disposal of assets efficiently
to be provided for.
l Tribunal should have clear authority and effective methods of
enforcing its judgments.
l Encourage and recognize the concept of Insolvency Practitioners
(Administrators, Liquidators, Turnaround Specialists, Valuers
etc). CS, CA and Cost Accountancy disciplines can offer high
quality professional for this purpose. Repeal of provision relating
to rehabilitation cess.
C. NEW CONCEPTS INTRODUCED BY DR. J.J. IRANI
COMMITTEE REPORT
To attune the Indian Company Law with the global reforms taking
place in the arena, the Report of the J J Irani Committee has sought
to bring in multifarious visionay concepts. The new concepts
introduced under the Report are as follows :
One Person Company (OPC)
To encourage corporatisation of business and entrepreneurship,
the concept of single person economic entity has been introduced in
the form of a 'one person company'.
It is recommended that:
(a) OPC may be registered as a private Company with one member
and may also have at least one director;
(b) Adequate safeguards in case of death/disability of the sole person
should be provided through appointment of another individual
Student Company Secretary
as Nominee Director. On the demise of the original director, the
nominee director will manage the affairs of the company till the
date of transmission of shares to legal heirs of the demised
member.
(c) Letters 'OPC' to be suffixed with the name of One Person
Company to distinguish it from other companies.
Small Companies
The law should provide a framework compatible to growth of small
corporate entities and should enable them to achieve transparency
at a low cost through simplified requirements. With this aim and to
enable simplified decision making procedure by relieving small
companies from select statutory internal administrative procedures,
the Committee has recommended that such companies be governed
by a simpler regime through exemptions which can be given in the
form of a schedule to the Act. Such companies should be subjected
to reduced financial reporting and audit requirements as well as
simplified capital maintenance regime. Such companies should also
be subjected to scaled down free structure. The definition of small
companies may be based upon the gross assets comprising of fixed
assets, current assets and investments not exceeding a particular
limit as also the turnover of the company concerned.
Limited Liability Partnership (LLP)
The 'unlimited liability' of partners has so far been the chief reason
why partnership firms of professionals, have not grown in size to
successfully meet the challenges posed today by international
competition, WTO, GATT etc. As an alternative corporate business
vehicle that has the benefits of limited liability but allows its members
the flexibility of organizing their internal structure as a traditional
partnership, the Committee has proposed the concept of LLP to be
introduced.
In an LLP, while the LLP itself is liable for the full extent of its
assets, the liability of the partners is limited. Partners are protected
from vicarious liability i.e. liability arising from the incorrect decision
or misconduct of other partners and employees not under their direct
control. There is no recourse to attach the personal assets of other
members except the member who is negligent. However, the liability
of negligent partner remains unlimited. Also any new or existing firm
of two or more persons can incorporate as an LLP.
Though advocating the adoption of the concept of LLP in the Indian
legal system, the Committee has recommended that a separate Act
be brought about to facilitate limited liability partnerships. The concept
need not be introduced in the Companies Act.
Independent Directors
Though the concept of independent directors is not new, it has so
far been enshrined in the corporate governance codes of various
countries. It is for the first time that the concept has been proposed
to be introduced in Company Law in India. The Committee has
however suggested that independent directors are required to be
appointed only in respect of listed companies or the companies which
have accepted public deposits.
The Committee has proposed that atleast one-third of the Board
should comprise of independent directors irrespective of whether the
company has an executive or non-executive Chairman.
No minimum qualification has been laid for an independent director.
It has been specified that the appointment of independent directors
should be made by the company from amongst persons, who in the
opinion of the Board, are persons with integrity, possessing relevant
expertise and experience and who satisfy the criteria for
independence. This will indirectly ensure that only the persons
possessing necessary knowledge, skills, and ethics are kept on the
Boards of Companies.
The Committee has recommended that the expression
'Independent Director', shall mean a non-executive director of the
company who:
15 April 2006
 ACADEMIC GUIDANCE
(a) apart from receiving director's remuneration, does not have, and
none of his relatives or firms/companies controlled by him have,
any material pecuniary relationship or transactions with the
company, its promoters, its directors, its senior management or
its holding company, its subsidiaries and associate companies
which may affect independence of the director.
(b) is not, and none of his relatives is, related to promoters or persons
occupying management positions at the board level or at one
level below the board;
(c) is not affiliated to any non-profit organization that receives
significant funding from the company, its promoters, its directors,
its senior management or its holding or subsidiary company;
(d) has not been, and none of his relatives has been, employees of
the company in the immediately preceding years;
(e) is not, and none of his relatives is, a partner or part of senior
management (or has not been a partner or part of senior
management) during the preceding one year, of any of the
following:-
(i) the statutory audit firm or the internal audit firm that is
associated with the company, its holding and subsidiary
companies;
(ii) the legal firm(s) and consulting firm(s) that have a material
association with the company, its holding and subsidiary
companies;
(f) is not, and none of his relatives is, a material supplier, service
provider or customer or a lessor or lessee of the company, which
may affect independence of the director;
(g) is not, and none of his relatives is, a substantial shareholder of
the company i.e. owning two percent or more of voting power.
Explanation:
For the above purposes-
(i) "Affiliate" should mean a promoter, director or employee of
the non-profit organization.
(ii) "Relative" should mean the husband, the wife, brother or
sister or one immediate lineal ascendant and all lineal
descendents of that individual whether by blood, marriage
or adoption.
(iii) "Senior management" should mean personnel of the
company who are members of its core management team
excluding Board of Directors. Normally, this would comprise
all members of management one level below the executive
directors, including all functional heads.
(iv) "Significant Funding" - Should mean 25% or more of funding
of the Non Profit Organization.
(i) "Associate Company" - Associate shall mean a company which
is an "associate" as defined in Accounting Standard (AS) 23,
"Accounting for Investments in Associates in Consolidated
Financial Statements", issued by the Institute of Chartered
Accountants of India.
Key Managerial Personnel
The Committee has identified CEO/MD/CFO and Company
Secretary as the Key Managerial Personnel for all companies, whose
appointment and removal shall be by the Board of Directors of the
company concerned.
Key Managerial Personnel should be in the wholetime employment
of only one company at a time and both the managing director and
the whole time directors should not be appointed for more than 5
years at a time. However, the present requirement of having managing
director/whole time director in a public company with a paid up capital
of Rs.5 crores may be revised to Rs.10 crores by appropriate
amendment of the Rules.
Directors and Officers (D&O) Insurance
The long felt need of the corporate sector in regard to extending
Student Company Secretary
insurance cover for the key man and key directors of companies has
been addressed by the committee. It is recommended that insurance
of key men and key directors and senior officers of companies may
be taken by means of general insurance policies and the insurance
premium paid by the company for such a policy need not be treated
as perquisite or income in the hands of director concerned. However,
if the wrongful act of the director or concerned officer is established,
then the appropriate amount of premium attributable to such person
shall be considered as perquisite or income for the purpose of
remuneration.
Rights and liabilities of independent and executive directors
Independent directors should have access to accurate, relevant
and timely information in order to discharge their duties and
responsibilities effectively. With this objective in mind, the Expert
Committee has recommended that Independent/non-executive
directors should be able to call upon the Board for due diligence or
obtaining of record for seeking professional opinion by the Board,
right to inspect records of the company, review legal compliance
reports prepared by the company; and in case of disagreement, record
their dissent in the minutes.
It is further recommended that if the independent director does
not initiate any action upon knowledge of any wrong, such director
should be held liable. This implies, if irregularities come to the
knowledge of the directors and yet they do not act pro actively and
exercise due diligence to ensure that the interest of the company is
duly protected, then they should be held responsible.
Freeing the Managerial Remuneration of limits
Managerial remuneration in India has so far been restricted to
certain limits in the case of public companies and private companies
which are subsidiaries of public companies, with the overall limit being
11 % of the net profits of the company durin~the financial year.
The Committee has recommended removal of all ceilings on
payment of directors' remuneration. Shareholders of companies have
been empowered to decide as to how to remunerate their directors.
However, this process is to be transparent and based on principles
that ensure fairness, reasonableness and accountability. It is important
that there should be a clear relationship between responsibility and
performance vis-a-vis remuneration, and that the policy underlying
Directors' remuneration be articulated, disclosed and understood by
investors/stakeholders. To ensure transparency, it is recommended
that Directors' Remuneration Report should form part of the annual
report of the company and should contain details of remuneration
package of ditectors including company's policy on directors'
remuneration, the performance graph of the company and the
remuneration of directors vis-a-vis the performance of the company.
Another important feature of the recommendations relating to
managerial remuneration is the removal of all government approvals.
The Committee felt that in the current competitive environment, where
Indian companies have to compete for specialized manpower globally,
it may not be feasible or appropriate for the government to interfere.
Instead of the restrictive regime based on 'government approvals',
the 'shareholder approval', regime be adopted. Decision on how to
remunerate directors should be left to the company. However, this
should be transparent and based on principles that ensure fairness,
reasonableness and accountability. The shareholders have been
recommended to be empowered to decide the remuneration of non-
executive directors including independent directors with no
government interference. The criteria for remuneration/compensation
of nonexecutive/independent directors should be based on their
attendance and contribution and performance of the company. This
may be in the form of sitting fees for Board and committee meetings
attended physically or participated in electronically and/or profit related
commissions.
Committees of the Board
While recognizing the need for discretion of the Board to manage
16 April 2006
 ACADEMIC GUIDANCE
and govern the company through collective responsibility, the Expert
Committee has mandated the constitution of certain committees of
Board for certain categories of companies, whose recommendations
would be available to the Board for taking final decisions. These
Committees are Audit Committee, Remuneration Committee and
Stakeholders Relationship Committee. Although the concept of Audit
Committee was already there in the Companies Act,1956 the
mandatory requirement of other two committees in respect of certain
companies is new. While the constitution of Audit Committee and
Remuneration Committee has been recommended as must for all
listed companies and companies accepting public deposits, the
stakeholders relationship committee is suggested to be constituted
in companies having combined shareholder/deposit holder/debenture
holder base of 1000 or more. The main recommendations in respect
of these committees are as below:
Audit Committee for Accounting and Financial matters
l Majority of directors to be independent, if the company is required
to appoint Independent Directors.
l Chairman of the Committee to be independent
l Atleast one member to have financial knowledge.
l Chairman to attend AGM and provide clarification on matters
relating to Audit. If Chairman is unable to attend, he may authorise
any other member of Audit Committee to attend AGM on his
behalf.
l Recommendations of the Audit Committee if overruled by the
Board should be disclosed in Directors' Report with the reasons
for overruling.
Stakeholders Relationship Committee
l To be constituted in companies having combined shareholder/
deposit holder/ debenture holder base of 1000 or more.
l Main objective shall be to monitor redressal of investor
grievances.
l Non-executive director to act as Chairman of the Comittee.
Remuneration Committee
l Compulsory constitution in Public listed companies or any
company accepting deposits.
l To comprise of non-executive directors including atleast one
independent director if appointment of independent directors is
required. In such a case, Chairman also to be independent.
l Main objective shall be to determine the company's policy and
remuneration packages of MD/Executive directors/senior
management.
l Chairman or in his obsence atleast one member of the committee
should be present in General Meeting to answer shareholders'
queries.
Recognition to joint venture/shareholders' agreements
The Committee recognised the issues involved in validity of joint
venture covenants vis-a-vis the provisions of the existing Act. It was
noted that joint venture agreements have several clauses pertaining
to voting rights, additional quorum requirements, arbitration provisions,
pre-emption rights or restrictions on transfer of shares etc. The effect
of this framework is that dispute resolution in respect of joint venture
provisions becomes subject to contract law provisions and is subject
to lengthy arbitration. Companies, however, prefer such aspects to
be addressed more speedily through the corporate processes.
The Committee has, therefore, recommended that a transparent
modality for providing recognition to agreements between joint venture
partners for corporate action should be worked out in company law,
keeping in view the concern that such arrangements should not become
a window for circumventing the essential provisions of the law.
Tracking and Treasury Stocks
Tracking Shares -The Committee has recommended the
Student Company Secretary
introduction of 'Tracking Stocks', also known as 'targeted stocks'.
Tracking Stocks as a financial vehicle that tracks the performance of
a particular division or subsidiary. A tracking stock is a type of common
stock that "tracks" or depends on the financial performance of a
specific business unit or operating division of a company, rather than
the operations of the company as a whole. As a result, if the said unit
or division performs well, the value of the tracking stocks may increase,
even if the company's performance as a whole is not up to mark or
satisfactory. The opposite may also be true.
By issuing a tracking stock, the different segments or divisions of
the company can be valued differently by investors. When a parent
company issues a tracking stock, all revenues and expenses of the
applicable division are separated from the parent company's financial
statements and bound to the tracking stock. Often this is done to
separate financial statement of a high-growth division from the financial
statements of the parent company which may contain huge losses.
The parent company and its shareholders, however, still control
operations of the subsidiary.
A key advantage of tracking stock is that it offers divisional
managers a degree of decision-making authority that might otherwise
be unattainable, given top management's reluctance to dilute its
control over the division's assets. The practical effect would be to
enhance job satisfaction for divisional managers, thus reducing
retention risk and also increasing the company's responsiveness to
changing market conditions. Also, investors have more direct access
to the specific businesses of the parent, which can be highly useful in
the case of a diversified company.
Treasury Stocks - The Committee has also recommended
introduction of treasury stocks as a measure for raising of funds at a
low cost. Presently, section 77 A of the Companies Act, 1956 provides
for buy-back of securities. Once bought back, the relevant securities
are to be extinguished. Internationally, however, a company can,
subject to certain restrictions, hold bought back shares itself under
the name "Treasury Stock". In other words, Treasury Stocks are the
shares which a company legitimately holds on its share register in its
own name. The voting rights on these Treasury Stocks are suspended
and company cannot exercise voting rights on such shares. No
distribution of dividend (including dividend during winding up) can be
made to such stock.
The Committee felt that a number of preparatory actions were
required before the concepts of Tracking Stocks and Treasury Stocks
could be introduced, such as the regulations to be framed by capital
market regulator, development of appropriate, specific accounting
standards etc. It therefore recommended that while an enabling
provision for Tracking I Treasury Stocks could be incorporated in the
new Law, actual introduction of Tracking and Treasury Stocks in the
Indian Capital Markets be made only when the necessary framework
is ready.
Perpetual Preference Shares
As per the existing provisions, preference shares can be issued
for a maximum period of 20 years. As many companies may like to
raise capital of a quasi equity and permanent nature on account of
long gestation project capital requirements, the Committee felt that
the concept of perpetual preference shares or preference shares of
higher tenure be permitted in the new Law. The Committee
recommended that companies should be permitted to issue perpetual/
longer duration preference shares and that returns from such shares
may be linked to market benchmark or reset periodically. In case the
subscriber of perpetual preference shares wants to redeem his shares
prematurely, necessary enabling provisions to redeem the shares by
the company up to a certain percentage of preference shares on an
annual basis may be provided. This may be done through "call/put
option mechanism". The Committee also felt that flexibility should be
given to the companies to revise the tenure of already issued
preferential shares by obtaining prescribed approval of shareholders
for variation of rights.
17 April 2006
 ACADEMIC GUIDANCE
Single Window Clearance for Mergers The Insolvency fund
The Committee recognised the fact that the Indian merger law, as The Committee proposed that the provisions relating to
it exists today, is cumbersome and time consuming and rightly rehabilitation cess should be replaced by the concept of 'Insolvency
emphasized on the need for speedier disposal of mergers and Fund' with optional contributions by companies. The Government may
acquisitions (M&As) proposals. Mergers and acquisitions today are a make grants for the fund and provide incentives to encourage
widely used multipurpose business tool that can bring long term contributions by companies to the fund. Companies which make
benefits in the context of increasing competitiveness in the market. contributions to the fund should be entitled to certain drawing rights
The Committee addressed on formulation of a corporate insolvency in the event of insolvency. Administration of the fund should be by an
legislation which would enable to carry out M&As with "digital speed" independent administrator. Insolvency fund should not be linked/
and made several recommendations in this regard. One of the credited to Consolidated Fund of India.
recommendation is a single window clearance for the purpose. The
law should provide for a single forum which would approve the
COMPANY ACCOUNTS
COMPANY
schemes of mergers and acquisitions in an effective time bound (STUDY UPDATES)4
manner. The concept of 'deemed approval' should be provided for in
I. INDIAN ACCOUNTING STANDARDS
cases where the regulators do not intimate/inform their comments
within a specified time period to the Court/Tribunal before which the The Accounting Standards Board of the Institute of Chartered
scheme of merger/amalgamation is submitted for approval. Accountants of India has so far issued the following Accounting
Standards.
Contractual Mergers
AS - 1 - Disclosure of Accounting Policies.
The Committee was of the view that contractual mergers may be
given statutory recognition in the Company Law in India as is the AS - 2 - Valuation of Inventories
practice in many other countries as a restructuring tool to hasten the AS - 3 - Cash Flow Statement.
process of mergers and acquisitions. Such mergers and acquisitions AS - 4 - Contingencies and Events Occurring after the Balance
are in the contract form (i.e. without the intervention of the court) and Sheet Date.
are made subject to subsequent approval of shareholders by simple AS - 5 - Net Profit or Loss for the Period, Prior Period Items and
majority. Changes in Accounting Policies.
The recognition of such contractual mergers would eliminate AS - 6 - Depreciation Accounting.
obstructions to mergers and acquisitions, give ex-post facto protection AS - 7 - Construction Contracts.
and the ability to rectify them.
AS - 8 - Withdrawn and superseded by AS-26
Time-bound proceedings for restructuring and liquidation AS - 9 - Revenue Recognition.
The Committee has recommended that a single independent forum AS - 10 - Accounting for Fixed Assets.
should be created for accelerating the liquidation process and a
AS - 11 - The Effects of Changes in Foreign Exchange Rates.
definite and predictable time frame should be provided for. The existing
time frame in India is too long and keeps precious assets locked in AS - 12 - Accounting for Government Grants.
proceedings for many years, destroying their value in the process. In AS - 13 - Accounting for Investments.
this protracted and never-ending process, the assets not only lose AS - 14 - Accounting for Amalgamations.
value but even disappear and vanish. On an average, a time frame of AS - 15 - Employee Benefits (Revised-2005)
two years should be feasible for the liquidation process to be
AS - 16 - Borrowing Costs.
completed. A period of one year should be adequate from
commencement of the process till sanction of a plan. There should AS - 17 - Segment Reporting.
also be a definite time period within which proceedings may AS - 18 - Related Party Disclosures.
commence from the date of filing of the application for rehabilitation. AS - 19 - Leases.
The legislation should limit the possibility of appeals at every stage AS - 20 - Earnings Per Share.
so that the process is not delayed through frivolous appeals or stalling AS - 21 - Consolidated Financial Statements.
tactics. A fixed time period should be provided for at each stage of AS - 22 - Accounting for Taxes on Income.
rehabilitation and liquidation process. Extension at every stage should
AS - 23 - Accounting for Investments in Associates in
be rare and allowed only in exceptional circumstances and in any
Consolidated Financial Statements.
case without effecting the outer time-limit provided for the process.
AS - 24 - Discontinuing Operations
On an average a time frame of 2 years should be feasible for the
liquidation process to be completed. AS - 25 - Interim Financial Reporting
AS - 26 - Intangible Assets
Insolvency Practitioners
AS - 27 - Financial Reporting of Interest in Joint Ventures
Keeping in view the important role of professionals and experts in
AS - 28 - Impairment of Assets
the insolvency process, the Committee has recommended the
recognition of the concept of 'Insolvency Practitioners'. Currently, the AS - 29 - Provisions, Contingent Liabilities and Contingent
law does not support effective participation of professionals and Assets.
experts in the insolvency process. Law should encourage and 2. CORPORATE DIVIDEND TAX
recognize the concept of Insolvency Practitioners(Administrators, As per Finance Act, 2003, the provision relating to tax on distributed
Liquidators, Turnaround Specialists, Valuers etc.) and disciplines of profit (corporate dividend tax) has been re-introduced and made
chartered accountancy, company secretaryship, cost and works effective from 1.4.2003 and accordingly the domestic companies are
accountancy, law etc. can act as feeder streams, providing high quality liable to pay tax on any amount declared, distributed or paid by way
professionals for this new activity. Greater responsibility and authority of dividend at the rate of twelve and one-half percent. Hence, the
should be given to Insolvency Practitioners under the supervision of practical problems given in the study material may be modified
the Tribunal to maximize resource use and application of skills.
4. Prepared by M.A. Joseph, Asst. Director, The ICSI.

Student Company Secretary 18 April 2006

 ACADEMIC GUIDANCE
accordingly and this aspect may be kept in mind while preparing for
June, 2006 examination.
3. STUDY NO.9 ACCOUNTS OF BANKING
COMPANIES
INCOME RECOGNITION
Assets of the banks are classified as performing assets and Non-
Performing Assets (NPAs) for the purpose of income recognition.
Assets, which are not non-performing, are performing assets. An asset
becomes non-performing when it ceases to generate income for
banks. With a view to moving towards international best practices
and to ensure greater transparency, 90 days overdue norm for
identification of NPAs has been adopted, from the year ending March
31st, 2004. Accordingly, a non-performing asset would be a loan or
an advance where:
(i) Interest and/or installment of principal remain overdue for a period
of more than 90 days, in respect of a term loan;
(ii) the account remain out of order in respect of overdraft/cash
credit;
(An account should be treated as 'out of order' if the outstanding
balance remains continuously in excess of the sanctioned limit/drawing
power. In cases where the outstanding balance in the principal
operating account is less than the sanctioned limit/drawing power,
but there are no credits continuously for 90 days as on the date of
Balance Sheet or credits are not enough to cover the interest debited
during the same period, these accounts should be treated as 'out of
order'.)
(iii) the bill remains overdue for a period of more than 90 days in
case of bills purchased and discounted;
(iv) interest and or installment of principal remains overdue for two
harvest seasons but for a period not exceeding two half years in
the case of an advance granted for agricultural purposes; and
(v) any amount to be received remains overdue for a period of more
than 90 days in respect of other accounts.
(Any amount due to the bank under any credit facility is overdue
if it is not paid on the due date fixed by the bank.)
Banks have been advised by the Reserve Bank of India that they
should identify the non-performing assets and ensure that interest
on such non-performing assets is not recognised as income and taken
to the profit and loss account. Banks are to recognise their income
on Accrual Basis in respect of income on performing assets and on
Cash Basis in respect of income on nonperforming assets. Any interest
accrued and credited to income account must be cancelled by a
reserve entry once the credit facility comes under the category of
non-performing assets.
ASSETS CLASSIFICATION AND PROVISIONS
(i) Assets Classification
Banks are required to classify the loan assets (advances) into
four categories viz:
(i) Standard Assets;
(ii) Sub-standard Assets;
(iii) Doubtful Assets; and
(iv) Loss Assets.
(i) Standard Assets : Standard asset is one which does not
disclose, any problem and which does not carry more than normal
risk attached to the business. Such asset is considered as
performing asset.
(ii) Subs-standard Assets : Sub-standard asset is one which has
remained as non-performing asset (NPA) for a period less than
or equal to 12 months. There is no promise of recovering the
dues in full, having regard to the value of security or current
networth of the borrower/guarantor, hence the possibility of loss
Student Company Secretary
in realising such debts. In other words, such an asset will have
well defined credit weaknesses that jeopardise the liquidation of
the debt and are characterised by the distinct possibility that the
banks will sustain some loss, if deficiencies are not corrected.
(iii) Doubtful Assets : An asset would be classified as doubtful if it
remained in the sub-standard category for 12 months. A loan
classified as doubtful has all the weaknesses inherent in assets
that were classified as sub-standard, with the added characteristic
that the weaknesses make collection or liquidation in full, - on
the basis of currently known facts, conditions and values - highly
questionable and improbable.
(iv) Loss Assets : A loss asset is one where loss has been identified
by the bank or internal or external auditors or the RBI inspection
but the amount has not been written off, wholly or partly. In other
words, such an asset is considered uncollectible and of such little
value that its continuance as a bankable asset is not warranted
although there may be some salvage or recovery value.
(ii) Provisions
The purpose of classification of bank assets is to make adequate
provision on the basis of quality of assets, the realisation of the security
and the erosion in the value of security. It has been directed that the
banks should make provision against the various assets on the
following basis:
(i) Standard Assets : A provision of 0.25% is required.
(ii) Sub-standard Assets : A general provision of 10 percent on total
outstanding should be made without making any allowance for
Deposit Insurance and Credit Guarantee Corporation/Export Credit
Guarantee Corporation guarantee cover and securities available.
The 'unsecured exposures' which are identified as 'substandard'
would attract additional provision of 10 per cent, i.e., a total of 20 per
cent on the outstanding balance. Unsecured exposure is defined as
an exposure where the realisable value of the security, as assessed
by the bank/approved valuers/Reserve Banks inspecting officers, is
not more than 10 percent, ab-initio, of the outstanding exposure.
(iii) Doubtful Assets:
(a) To the extent the debt is not covered by realisable value of
the security, 100% provision is to be made.
(b) In regard to the secured portion, provision may be made on
the following basis, at the rates ranging from 20 percent to
100 percent of the secured portion depending upon the
period for which the asset has remained doubtful:
Period for which the advance has Provision requirement (%)
remained in 'doubtful' category
Up to one year 20
One to three years 30
More than three years
(i) outstanding stock of NPAs - 60 per cent with effect
as on March 31, 2004 from March 31, 2005
- 75 per cent with effect
from March 31, 2006
- 100 per cent with effect
from March 31, 2007
(ii) advances classified as 100 percent with effect from
'doubtful more than three years] March 31,2005
on or after April 1, 2004
(iv) Loss Assets: The entire assets should be written off or if the
assets are to be retained in the books for any reason, 100%
provision is required to be made.
Note: Provision towards standard assets should not be deducted
from advances but shown separately as contingent provsions against
standard assets under "Other Liabilities and Provisions" - 'Others' in
Schedule V of the Balance Sheet.
19 April 2006
 ACADEMIC GUIDANCE
SECURITIES LAWS AND REGULA
LAWS TION
REGULATION
OF FINANCIAL MARKETS
(INTER GROUP II)
STUDY UPDATES5
STUDY IV - CAPITAL MARKET INTERMEDIARIES
SEBI, in addition to the information furnished in form A under
SEBI (Portfolio Managers) regulation, has prescribed for certain
additional information to be submitted by the applicant while seeking
registration/renewal as portfolio managers . The applicant has been
required to furnish the additional detailed information in the following
areas:
1. Memorandum and Article of Association of the applicant
2. Details of Directors & shareholding pattern
3. Details of Promoters & shareholding pattern
4. Details of applicant registered with SEBI as any other
intermediary.
5. Details of the Principal Officer
6. Details of Key personnel
7. Details of infrastructure facilities
8. Details of the proposed Schemes
9. Details of facility for safe custody
10. Details of facility for equity research
11. Financial Accounts of the applicant
12. Report from principal bankers
13. List of brokers
14. Details regarding applicant registered with RBI (if any).
15. Details of associated registered intermediaries
16. Declaration by at least two directors
17. Declaration for fit and proper person
18. Directors Declaration under regulation 6.
The applicant has been advised to note that furnishing of
incomplete information would delay the processing of the application.
The applicant has also been advised to keep the SEBI informed of all
the consequent changes in the information provided to the board.
STUDY VI PUBLIC ISSUE OF SECURITIES
HIGHLIGHTS OF AMENDMENTS TO SEBI (DIP)
GUIDELINES, 2000
I. SEBI vide its circular SEBI/CFD/DIL/DIP/14/ 2005/25/1 dated
January 25, 2005 amended SEBI (Disclosure and Investor
Protection) Guidelines, 2000.The amendments can be
categorized under the following heads :
1. Order of presentation of disclosures in prospectus
2. Requirements relating to abridged prospectus
3. Requirements relating to issue advertisements
4. Appointment of co-managers, advisors, etc.
Order of presentation of disclosures in prospectus
1. Section I dealing with contents of the prospectus of Chapter VI
of the guidelines i.e. Contents of the Offer Document has been
amended. Clauses of Section I have been rearranged in the
same order in which disclosures should appear in the prospectus.
2. All the disclosure requirements specified under Schedule II of
the Companies Act, 1956 have been retained either under the
same heading or under new headings.
3. Few requirements/sections have been added to make the
prospectus more effective like summary, table of contents,
industry review, etc.
5. Prepared by Sonia Baijal, Asst. Director, The ICSI.
Student Company Secretary
4. Repetitive disclosures are required to be avoided by giving cross
references to the extent possible.
5. An annexure indicating order of presentation of disclosures in
the prospectus has been inserted in the guidelines for easy
understanding.
6. Issuers are free to make additional disclosures, so long as they
are not inconsistent with the guidelines. Further, the said
disclosures should be, to the extent possible, within the broad
headings as specified in Section I of the guidelines i.e. Contents
of the Offer Document.
Requirements relating to abridged prospectus
In order to achieve the objective of making the abridged prospectus
more readable, the guidelines have amended Section II of Chapter
VI of the guidelines which lays down the disclosure requirements in
the abridged prospectus. The amendments include :
1. increasing the readability / visual impact of the contents of the
abridged prospectus,
2. deleting the repetitive disclosures, etc.
3. sequencing of items followed shall be the same as appearing in
the prospectus.
4. supplementing the disclosures in abridged prospectus (As per
Form 2A of the Companies Act, 1956) by such information as is
considered most relevant for the prospective retail investors.
Requirements relating to issue advertisements
The pre-issue advertisement plays an important role in creating
awareness about the issue. However, the cost involved in publishing
the entire Form 2A,i.e., abridged prospectus in the newspaper was
reported to be too high. In view of this and also to make available the
abridged prospectuses along with the application form, SEBI
guidelines have been amended to provide for the following:
Pre-issue advertisement has been made mandatory for all public
issues (fixed or book built).
1. The issue advertisements (pre-issue advertisements, issue opening
or closing advertisements) have been required to contain the
minimum details prescribed in the formats specified in the guidelines.
2. The issue advertisements like issue closing or opening
advertisement, continue to be optional.
3. The issuer company has an option of including additional
disclosures in these advertisements so long as they are not
inconsistent with the guidelines and subject to the same being
in compliance with the principles and code of advertisements
laid down in Chapter IX of the guidelines.
4. Any Bill Board Advertisement in regard to an issue shall not
contain information other than as stipulated in the formats
specified in the guidelines.
Appointment of co-managers, advisors, etc.
Clause 5.4.2.1 of the existing guidelines restricting the number of
co-managers and advisors which can be appointed in an issue has
been removed. The Disclosure(s) pertaining to issue expenses have
also been enhanced.
II. Amendments to the SEBI (Disclosure and Investor
Protection) Guidelines, 2000 vide circular dated March
29,2005 relate mainly to the book building process.
Highlights of the amendments are as under:
Retail Individual Investors(RIIs)
The RII, at present, is defined in value terms as one who can apply
for shares upto a maximum amount of Rs.50,000/-. SEBI has decided
to redefine the RII as one who can apply up to Rs.1,00,000/-.
Allocation category for retail individual investors
At present, in a book built issue allocation to Retail Individual
Investors,Non Institutional Investors (NIIs) and Qualified Institutional
Buyers (QIBs) is in the ratio of 25: 25: 50 respectively. SEBI has increased
20 April 2006
 ACADEMIC GUIDANCE
the allocation to RIIs from the existing 25% to 35% and correspondingly
reduced the allocation to NIIs from the existing 25% to 15%.
Further, in case the book built issues are made pursuant to the
requirement of mandatory allocation of 60% to QIBs in terms of Rule
19(2)(b) of SCRR , the respective figures are 30% for RIIs and 10%
for NIIs. This is a transitory provision pending harmonization of the
QIB allocation in terms of the aforesaid Rule with that specified in the
guidelines.
Bidding period
The existing SEBI guidelines provide a maximum bidding period
of 10 days extendable by three more days, if there is a revision in
price band. SEBI has decided to reduce the bidding period from current
5 10 days (including holidays) to 3 -7 working days.
Timing of disclosure of Price Band/ Floor Price
The existing guidelines require all issuers (whether listed or
unlisted), making a public issue through book building process to
disclose the price band/ floor price in the Red Herring Prospectus
(RHP)/application form. SEBI vide this amendment has given an
option to listed issuers to either (a) disclose price band in RHP /
application form/abridged prospectus (current practice) or (b) to
disclose the price band /floor price atleast one day before bid opening.
Data reporting at website of stock exchanges.
In order to ensure dissemination of relevant information in public
domain, SEBI guidelines have been amended inter alia to improve
the contents of and to ensure uniformity in data display on the websites
of the concerned stock exchanges and to ensure availability of data
for a further period of 3 days after the closure of the bids/issue.
III SEBI vide its circular SEBI/CFD/DIL/DIP/16 / 2005/19/9 dated
September 19, 2005 again amended SEBI (DIP)
Guidelines.The highlights of the amendments are :
Specific allocation for mutual funds within the QIB category :
Presently, mutual funds registered with SEBI in terms of SEBI
(Mutual Funds) Regulations, are not given any specific allocation within
the QIB category in book-built issues. It has now been decided to
provide 5% of the 50% or 60% {in case of issues in terms of Rule
19(2)(b) of SCRR} of net offer to public available for allocation to
QIBs, for mutual funds.
Effectively, out of the portion available for allocation to QIBs, 5%
will be available for allocation to mutual funds. All eligible bids by
mutual funds will be considered for allocation in the afore mentioned
5% as well as in the balance available for QIBs. An illustration
explaining the method of allocation to mutual funds has also been
incorporated in the guidelines. In the event of inadequate response
from the mutual funds, the shares may be made available to QIBs
other than mutual funds.
Proportionate allotment to QIBs
Presently, the allotment to QIBs is decided by Issuer Company in
consultation with Book Running Lead Managers (BRLMs). The existing
provisions of proportionate allotment as applicable for Retail individual
investors (RIIs) and Non Institutional Investors (NIIs) has been made
applicable to the QIB category. It has also been provided that where
BRLMs have reasons not to accept a QIB bid, the same should be
done at the time of receipt of the bids and the reasons therefor should
be disclosed to the bidders. Necessary disclosures in this regard
have also been required to be made in the offer document.
Margin requirements for QIBs
The guidelines does not mandate any specific margin for any of
the categories eligible for applying in public issues, whether RIIs,
NIIs or QIBs. However, it has been observed that in practice, in all
the book built issues, there has invariably been 100% margin for RIIs
and NIIs, but no margin for QIBs. Therefore, the amendment provides
to bring in margin of 10% in QIB category.
IV SEBI vide its circular SEBI/CFD/DIL/DIP/17/ 2005/11/11 dated
Student Company Secretary
November 11, 2005 modified the format of issue
advertisements in Schedule XX-A of SEBI (DIP) Guidelines,
2000 to provide for the SEBIs disclaimer clause.
The amendment to the guidelines provides that in Part A, Part B
and Part C of Schedule XX-A of the guidelines, after the heading
proposed listing the following shall be inserted:
Disclaimer Clause of SEBI: SEBI only gives its observations
on the offer documents and this does not constitute approval of either
the issue or the offer document.
STUDY X COLLECTIVE INVESTMENT VEHICLES
SEBI Circular SEBI/IMD/CIR No.3/50241/05 dated September
26, 2005 provides for amendment in the norms pertaining to
investment by mutual funds in ADRs/GDRs/foreign securities. It
provides that in mutual fund schemes, where disclosure pertaining
to investment in ADRs/GDRs/foreign securities has not been made
in the offer document, then in such cases prior to investment in ADRs/
GDRs /foreign securities for the first time, the AMC shall ensure that
a written communication about the proposed investment is sent to
each unitholder and an advertisement is given in one English daily
newspaper having nationwide circulation as well as in a newspaper
published in the language of the region where the Head Office of the
mutual fund is situated. The communication to unitholders shall also
disclose the risk factors associated with such investments. However
this provision has not been made applicable to existing mutual fund
schemes where relevant disclosure regarding investing in ADRs/
GDRs/foreign securities has already been made.
STUDY XVI CORPORATE GOVERNANCE IN
SECURITIES MARKET
For text of the revised Clause 49 of the listing Agreement, please
refer the Heading Corporate Governance in listed companies-Clause
49 of the listing Agreement under Company Law Updates in this
issue.
THE COMPETITION ACT ACT,, 2002
IELIL-INTERMEDIATE/FSPELDC-FINAL
The students are informed that the following Sections of the
Competition Act, 2002 are applicable for June, 2006 examination:
Short Title, Extent and Commencement (Section 1), Definitions
(Section 2), Establishment of Commission (Section 7), Composition
of Commission (Section 8), Selection of Chairperson and Other
Members (Section 9), Terms of Office of Chairperson and Other
Members (Section 10), Resignation, Removal and Suspension of
Chairperson and other members (Section 11), Restrictions on
Employment of Chairpersons etc. (Section 12), Financial and
Administrative Powers of Member-Admininstration (Section 13),
Salary etc. of Chairperson and Other Members (Section 14),
Vacancy etc. not to invalidate proceedings of Commission (Section
15), Appointment of Director General (Section 16), Registrar and
Officers of Commission (Section 17), Benches of Commission
(Section 22), Distribution of Business of Commission (Section 23),
Appearance before Commission (Section 35), Competition
Advocacy (Section 49), Finance, Accounts and Audit (Sections 50,
51, 52 and 53), Miscellaneous (Sections 54, 55, 56, 57, 58, 59, 60,
61, 62, 63, 64 and 65).
Students are advised to refer these Sections if any question is
posed on the Competition Act, 2002. A comparison of the provisions
of the MRTP Act, 1969 and the provisions of the Competition Act,
2002 is desirable to highlight the changes inserted by the
Competition Act, 2002.
Since all the Sections of the Competition Act, 2002 have not
come into force till now, the students may refer to provisions of
MRTP Act, 1969. However, credit will be given to the students if
they also refer the provisions of the Competition Act, 2002, while
answering the questions based on MRTP Act, 1969.
21 April 2006
 ACADEMIC GUIDANCE
EXAMINERS OBSER
OBSERVVATIONS AND 7 World Trade Organization 35.4 27.5
International Trade, Joint Ventures
COMMENTS ON THE PERFORMANCE and Foreign Collaborations
OF EXAMINEES IN DECEMBER 2005 8 Direct and Indirect Taxation 46.5 20.4
EXAMINA TION*
EXAMINATION* Law and Practice

The December 2005 session of the Company Secretary Course 9 Human Resource Management
Examination was held from 26th December 2005 to 3rd January 2006. and Industrial Relations 43.3 18.3
The pass percentage for all papers of both Intermediate and Final
Courses have been compiled and given in Table A hereunder for the INTERMEDIATE COURSE
information of the students. Though the pass percentage showed
1. GENERAL AND COMMERCIAL LAWS
good performance by the candidates in most of the papers, some
candidates were not able to clear the examination due to various On the basis of the form, content and quality of the answers given,
drawbacks in their answers. Therefore, it would be beneficial for these it appeared that a considerable percentage of the candidates had not
candidates to know the general weakness/drawbacks in their answers. prepared for the examination seriously. They had prepared on selective
Although, it is not possible to give comments on each and every basis as some of the answers given by them were quite good and
candidates answer scripts, some common drawbacks based on the rest were hopeless. The candidates displayed poor knowledge in
comments and observations noted by the examiners have been culled Constitutional Law. Most of the candidates even did not know the
and given paper-wise hereunder for information of the candidates so fundamental aspects of Indian Constitution. Many failed to mention
as to enable them to overcome their deficiencies and improve their relevant legal provisions and could not give sound legal reasoning
performance in the forthcoming examination. while dealing with problem-oriented questions.
Table A Question No.1 being compulsory, most of the candidates
attempted part (a) upto the mark. The doctrine of colourable legislation
Statement Showing the Pass Percentage of Papers in in 1(c) and writ of certiorari in 1(c) were answered poorly as the
December 2005 Examination candidates could not understand the theme of the questions. Part (a)
Subjects Percentage of and (b) of Question No.2 were attempted satisfactorily by most of the
Candidates Secured candidates but many failed to appreciate the doctrine of feeding the
40 to 49 50 % and grant by estoppel in Question No. 2(c). The performance in Question
% marks above marks No.3 and 4 was not up the mark. Most of the candidates seemed to
be ignorant about the term actionable claim. Question No.4 (b) (ii)
INTERMEDIATE COURSE was not answered well. Systematic and logical presentation was
lacking. In Question No.5, the questions pertaining to I.T.Act were
1 General and Commercial Laws 30.9 28.0 well attempted. However many confused for place of registration in
2 Company Accounts and Cost 22.6 10.8 part (b) with kinds of registration. Question No.6 (b) was not answered
& Management Accounting satisfactorily by many. Question No.7 was well answered. Some
candidates did exceedingly well displaying keen interest in problem
3 Tax Laws 26.9 12.8 solving. Majority of the candidates performed average in Question
4 Management Information Systems 34.2 26.9 No.8 (a) and 8(b). Part (c) of the question was attempted poorly by
and Corporate Communication majority displaying lack of clarity of concept.
5 Company Law 34.0 21.9 Candidates are advised to read the subject seriously. They should
read Bare Acts and latest case laws to have knowledge about the
6 Company Secretarial Practice 36.7 21.0 legal provisions as well the latest judicial decisions. It is absolutely
7 Economic, Labour and Industrial Laws 36.9 12.2 necessary for solving problems based questions. While dealing with
problem-oriented questions, quote relevant legal provisions and
8 Securities Laws and Regulation 33.5 30.6
support your answers by giving sound legal reasoning. They are
of Financial Markets
advised to read Student Company Secretary, Chartered Secretary
FINAL COURSE and other professional Journals to improve their communication skills
1 Advanced Company Law 45.1 12.3 as well as update their knowledge on the subject.
and Practice 2. COMPANY ACCOUNTS AND COST &
2 Secretarial Practice Relating to 44.0 25.5 MANAGEMENT ACCOUNTING
Economic Laws and Drafting & Candidates showed very poor performance in this paper as only
Conveyancing 33.4 percent of the candidates could secure 40 percent or more marks.
This paper being practical oriented candidates could have scored
3 Secretarial, Management and 43.4 35.5
high marks had they taken the examination with thorough preparation
Systems Audit
and desired seriousness. Clarity in understanding of basic concepts,
4 Financial, Treasury and Forex 40.7 19.8 and fundamental principles of company accounts and cost accounting
Management was missing in most of the answers. Candidates had taken the
5 Corporate Restructuring 43.7 29.9 examination in a casual manner without proper preparation. Many
candidates had given generalized answers instead of specific and
Law and Practice
logical answers. Majority of the candidates put up a halfhearted
6 Banking and Insurance 33.1 52.4 approach and they could not answer all the questions in the stipulated
Law and Practice time. Candidates exposure in solving practical questions was very
shallow though some candidates were able to put a brave face in
*Compiled from Examiners Report. theoretical questions.

Student Company Secretary 22 April 2006

 ACADEMIC GUIDANCE
In Question No.1 candidates could discuss about the accounting
standards but could not specify its the significance. Majority of the
candidates made mistakes in preparation of ledger accounts such as
Debenture Sinking Fund Account and Debenture Sinking Fund
Investment Account. In part (v) candidates in general were not aware
about how to utilize the general reserve for payment of dividend in
case of inadequacy of profit. In Question No.2 (a) journal entries were
incorrect especially about the underwriting commission and discount
on issue of debentures. Basic concepts involved in preparing
consolidated balance sheet were missing in most of the answers in
Question No.2 (b). Candidates could not adjust the value of bonus
shares while arriving at the amount of capital reserve. Question No.3
(b) candidates made mistakes in calculation of average capital
employed and future maintainable profit, which led to wrong calculation
of goodwill. Adjustments for bad debts and depreciation on revaluation
of assets were missing in most of the cases. In Question No.4 (a)
while calculating purchase consideration many candidates left the
arrears of dividend on preference shares. Further candidates failed
to arrive at the value of building for scheme of amalgamation. In part
(b) only few candidates could follow the correct provisioning norms
applicable for different assets of the banking company. In Question
No.5 (ii) use of simultaneous equation method was not familiar to
many candidates while apportioning the expenses of service
departments to production departments. Question No 5(iv) was
basically from the study material, still candidates failed to calculate
the value of closing stock and cost of sales under CPP method (current
purchasing power method). In part (iii) though candidates could explain
the concept of break-even analysis but failed to explain its significance.
In Question No.6 only very few candidates could prepare the statement
of cost correctly. Most of the candidates did not attempt this question.
In Question No.7 candidates performances were far from satisfactory
as only few could calculate the labour variances. In Question No.8
(a) candidates could not derive the figures for the various items for
the balance sheet from the given ratios, which showed their lack of
knowledge in interpreting the ratios. By and large, candidates could
correctly prepare the cash flow statements for question No. 8(b).
Candidates should read the study material, suggested answers
and refer the suggested readings thoroughly and familiar themselves
in solving practical problems to score good marks. Necessary working
notes should also be given along with answers. Candidates should
carefully read the question and understand the issues before
answering the same for proper presentation and time management.
3. TAX LAWS
In-depth knowledge of various provisions of the Income-tax Act,
1961, was found absent in most of the answers.
Question No.1, being compulsory, was attempted by all. The
performance of the students in this question was poor as majority of
the candidates answered the questions in a vague and casual manner;
they failed to provide the correct provisions. Most of the students
could not write answers to Question No.2(b) correctly by specifying
the provisions of section 194B of the Income-tax Act. In Question
No.3, many candidates could not distinguish the provisions of Section
263 and 264 of the Income-tax Act. Question No. 4 was answered
correctly in most of the cases but few had computed additional
depreciation in part(a). Only few candidates had attempted the
Question No. 6 which showed poor knowledge of the provisions of
the Central Excise Act,1944. In Question. No. 7(a), the concept of
entry with reference to Customs Act,1962 was not known to many
of the candidates.
Candidates can improve their performance with thorough
preparation and full knowledge of all the provisions of tax laws. Study
material provided by the Institute should be studied in-depth along
with reference books for solving practical questions. Candidates must
read the concerned textbook in the light of assessment year relevant
to the examination. Questions should be read carefully before
Student Company Secretary
answering it. In practical questions, answers should be supported by
working notes wherever required, besides proper reasoning and
justification.
4. MANAGEMENT INFORMATION SYSTEM AND
CORPORATE COMMUNICATION
The overall performance of the candidates in this paper was
satisfactory. In part A, Management Information System, some
candidates were not aware of the basic concepts of information
technology and thus they could not provide correct answers. This
showed their inadequate preparation for examinations , poor reading
habits of reference books and lack of proper understanding of the
questions.
The answers to Question No.1, a case study (on Data warehouse.
Database, and on EDI translator) were of average level. Many
candidates did not write the answers as per requirements of the
question. For example, in part(b) very few candidates could write
trade of factors, instead majority explained EDI. Candidates attempt
to Question No.2 on distinction between secure HTTP and secure
electronic transaction, circuit switching and packet switching , DSS
and MIS etc. were up to the mark and satisfactory in most of the
cases. The answers to application oriented Question No 3(a) and
3(b) on short notes were good with certain exceptions. Some of the
candidates failed to appreciate the concepts and answered the
question in general way. Question No.4 on MIS and short notes was
well attempted by the majority of the candidates. In part-B of the
paper on Corporate Communication, answers were not well structured,
brief, to the point and in correct English. Candidates were lacking
style of presentation in many questions. The answers to application
oriented and analytical Question No. 5 were satisfactory. However,
some candidates got confused while writing answers to this question.
In few cases, the style of presentation was missing. Candidates
performance in Question Nos. 6 and 7 were up to mark. The answers
to Question No. 8 (a) on benefit of counselling and 8(b) on short
notes were just satisfactory.
MIS portion of this paper being technical one, expects from the
candidates, in-depth study and proper understanding of the subject.
In corporate communication, there is need to improve presentation
skill with correct and logical expression. To secure good marks in this
paper, candidates are advised to focus on thorough reading of the
subject by referring to the study material and suggested reading. They
should develop conceptual clarity and analytical ability for proper
understanding of the question.
5. COMPANY LAW
It was observed that most of the candidates lacked clarity of
expression, fundamental knowledge of the subject and analytical
approach. Whereas the language of law should be such, so as to
define, limit and confine the matter, the candidates tried to stretch
their answers with imagination and used fiction rather than precision.
Question No.1, was attempted fairly well, but the answers thereto
were not substantiated with case laws. Question No.2, was poorly
attempted by the candidates depicting lack of knowledge of SEBI
guidelines and provisions of listing agreement in relation to private
placement. Answers to Question No.3, were also found to be
unsatisfactory, as the candidates did not deliberate on the exclusive
powers of the Board to be exercised at their meetings. The concept
of interested directors and loans to relatives and employees were
also not properly dwelt with in this question. The answers to Question
No.4 were found average level except that in few cases, the candidates
considered the reserves for redemption of debentures as free
reserves. In Question No.5 (b) some candidates were not familiar
with the aspect of signing of Boards Report. The performance in
Question No.6, was generally found to be average. Answers to
Question No.7, were found to be very sketchy as most of the
candidates confused the concept of minority shareholders interest
with that of minor shareholders interest. In Question No.8 the doctrine
23 April 2006
 ACADEMIC GUIDANCE
of cypres was answered as doctrine of ultra vires or doctrine of indoor
management.
Candidates are expected to have a clear and concise exposition
of all the relevant provisions of Company Law and all its allied aspects.
They are advised to study thoroughly the reference materials, follow
a professional approach, be precise and present their answers in a
legible manner. Candidates should emphasize on judicial
pronouncements and quote relevant sections wherever possible.
Candidates are also advised to refer to Chartered Secretary, Student
Company Secretary, Bare Acts, other Journals and to access the
website of the Institute and other regulatory bodies to update their
knowledge.
6. COMPANY SECRETARIAL PRACTICE
The answers given by some candidates exhibited poor drafting
skills and presentation. Conceptual clarity was also missing in many
answers.
Question No.1, requiring drafting of notice of AGM, however, the
drafting was not upto the mark. The Question No.2, was well attempted
specifically part (a) regarding the procedure for incorporation of a
private limited company which was scored well by majority. In part (b)
most of the candidates mentioned clauses and related requirements
for Memorandum of Association instead of drafting a Memorandum
of Association. The answers to part (ii) and (iv) of Question No.3 was
well attempted by majority. In Question No.4, the overall performance
of the candidates was good. This being an objective and scoring
question, most of the students secured average marks. Answers to
Question No.5 (a) requiring drafting of resolution was poorly attempted.
In Question No.6 none of the candidates considered tax implication
before declaring dividend. Question No.8, was well attempted except
part (iv) regarding distinction between Managing Director and Whole-
time Director.
Candidates are advised that while answering true/false questions,
they must justify their answers by logical reasoning/case laws and
provisions of the Act. Candidates need not consider length of answer.
A precise and to the point answer can fetch good marks as compared
to unduly long answers. Further, section numbers should not be quoted
if they are not sure, as wrong quoting of section numbers leads to
deduction of marks. For questions relating to procedures, the answers
should be dividend into paras, serially numbered and not in continuous
form. Students need to pay more attention to sharpening of drafting
skills and improvement in handwriting. Candidates are advised to go
through not only the study contents but also the Annexures to study
materials. They should update themselves regularly by referring to
Chartered Secretary, Student Company Secretary, Annual Reports
of various public companies and other Corporate Journals.
7. ECONOMIC, LABOUR AND INDUSTRIAL LAWS
In this paper the candidates failed to present the answers in a
logical manner and wrote vague and general answers. They failed to
refer to the relevant provisions of law and cite decided case laws.
Poor handwriting and lack of command over English language were
also noticed in many cases. Candidates, in general were not
thoroughly aware of the provisions of Trade Marks Act, Patents Act,
FEMA, Consumer Protection Act and pollution control laws.
Question No.1 was attempted fairly well by the candidates.
Answers to Question No. 2 were showed lack of preparation as
answers were not supported by relevant provisions of the Act. In
Question No. 3, candidates were lacking knowledge of the provisions
of FEMA. Answers in Question No. 4 were not supported by reasonng,
which made the answers very vague. Question No. 5 (b) and (c) were
not answered properly which reflected lack of preparation. Answers
to Question No. 6 were not adequately supported by specific provisions
and case laws. Answers to Question No. 7 were by and large
satisfactory but the candidates in general were not very clear about
the provisions of various Acts and failed to support their answers by
relevant case laws.
Student Company Secretary
Candidates should have intensive, regular and planned study. They
are advised to update their knowledge based on the amendments/
developments in the Acts prescribed in this paper and refer the decided
case laws. In addition to Chartered Secretary, Student Company
Secretary and corporate Journals, candidates are advised to regularly
read financial dailies to improve their knowledge, and communication
skills.
8. SECURITIES LAWS AND REGULATION OF
FINANCIAL MARKETS
Candidates in general lacked understanding of basic concepts of
the subject. They put irrelevant details to fill more pages of answer
books. It was observed that candidates did not study the subject
thoroughly to abreast themselves of the latest changes and
amendments taking place in the area. Most of the answers were vague
and ambiguous.
Question No.1 being compulsory question on short notes on
different topics was attempted satisfactorily by most of the candidates,
though some answers lacked conceptual clarity. Candidates could
not answer Question No.2(a) on concept of Ombudsman, though
many were able to answer part (b) on defining of various concepts
quite well. In Question No.3(a), the candidates were not aware of
various aspects covered under Secretarial Audit. Candidates wrote
about eligibility criteria of delisting in a casual way and also could not
answer the provisions relating to NBFCs properly. In Question No.4(b)
on contents of offering circular for euro issues, candidates wrote very
general answers. In Question No.4(c) , very few could explain the
role of credit rating agencies. Question No.5 relating to Board note
on general obligations of acquirer was well attempted by most of the
candidates. In answering part (b) of the Question, candidates were
able to calculate value of rights correctly. The candidates wrote very
general answers to part (a) and (b) of Question No.6 on concept of
connected person and due diligence. Candidates were also unable
to discuss the provisions of SEBI (Prohibition of Fraudulent and Unfair
Trade Practices) Regulation, 2003 in part(c). In Question No.7 the
legal provisions related to Employee Stock Purchase Scheme were
not properly answered. In Question No.8 candidates wrote the answers
relating to book building and buy-back of securities satisfactorily.
This being a dynamic subject attracting many amendment/changes
in the securities market, candidates are advised to be well aware and
update about the latest developments taking place in this area.
FINAL COURSE
1. ADVANCED COMPANY LAW AND PRACTICE
Lack of clarity and understanding of the subject was evident in
most the answers. Candidates who had not prepared thoroughly for
the examination wrote unnecessary details ignoring the requirement
of the question. Many candidates lacked logical presentation while
answering practical questions and gave improper legal reasoning.
In Question No.1(i) instead of interpreting the provisions of Section
314 in relation to Managing Director and his relatives, candidates
explained the provisions of Section 314 and 314(1B) without
differentiating its non-applicability to Managing Director, but its
applicability to the relatives of Managing Director. In part (ii) candidates
were not aware about the decision of Supreme Court in Worldwide
Agencies (P) Ltd. The overall performance of candidates in Question
Nos. 2 and 3 was satisfactory. In Question No. 4 the standard of
drafting resolution and notice of an extra-ordinary general meeting
was not commensurate with the level expected from the students of
final course examination. In Question No. 5(a) it was observed that
candidates were not aware of the changes contemplated by the
Concept Paper. In part (b) some candidates explained in detail the
reasons or causes when the Court can order winding up of the
company instead of explaining the jurisdiction of the Courts relating
to the winding up of the company. Part (c) was suitably answered. In
Question No. 6(a) some candidates could not properly draft the
resolution. In part (c), candidates failed to furnish relevant case laws
24 April 2006
 ACADEMIC GUIDANCE
to support their answers. In Question No. 7(b) candidates attempted
the question in the form of a covering letter only without giving
particulars of Form No. 24A. Question No. 8 was well attempted by
the candidates. However in part (b), it was observed that most of the
candidates had reasonable knowledge about the Board procedure
recommended by Kumar Mangalam Birla Committee, but the same
was not put or explained effectively. Also the attempt on information
to be made available to the Board was very general in nature.
Candidates are advised to practice drafting resolutions and notices.
The drafting skills can be improved by reading the notices of general
meeting of good companies. Presentation of answers should be of
high level with professional approach as candidates are expected to
exhibit expert knowledge. Candidates are advised to study
comprehensively to understand the concepts and present their
answers in a systematic manner. Relevant legal provisions should
be quoted, judicial pronouncements if any, should be stated and
answers should be supported by sound legal reasoning.
2. SECRETARIAL PRACTICE RELATING TO
ECONOMIC LAWS AND DRAFTING AND
CONVEYANCING
The overall performance of the candidates in this paper was found
to be reasonable, barring few questions in which candidates used
guess work perhaps due to lack of adequate preparation.
In Question No.1 though the answers were satisfactory, the
candidates could not reason out and support their answers with relevant
case laws. While only few candidates attempted Question No.2, those
who attempted showed lack of knowledge of relevant provisions of
FEMA and requirements of EIA notification. Most of the candidates
attempted Question No.3, but answers to Question No.3(b) and (c)
were below desired levels. In Question No.4 candidates were found
well prepared as most of the candidates attempted this question
satisfactorily. Answers to Question No.5 were below expectations.
Candidates found lacking in drafting skills, particularly in Question
No.5(a) and (b) dealing with drafting of arbitral award and specimen
proxy form. Candidates attempted Question No.6 satisfactorily, except
6(b) where the lack of knowledge was apparent. Most of the candidates
answered Question No.7 fairly well and found to have grasp of the
subject in question. Lack of drafting skills were noticed in answers to
Question No.8 relating to deed of assignment and deed of dissolution.
This paper requires understanding on application of law. The
candidates are therefore advised to use the legal language in drafting
agreements ,deeds, etc and also include all important clauses. As
the candidates were found very poor in drafting of legal documents,
they are advised to read the suggested readings on drafting and
conveyancing. Problems based on decided cases should be supported
by relevant case law. Candidates are advised to take the exams
seriously and prepare themselves in an organized manner and keep
themselves abreast of the government guidelines and the new
declared policies.
3. SECRETARIAL, MANAGEMENT AND SYSTEMS
AUDIT
In this paper, the candidates exhibited reasonable academic
knowledge but lacked practical application and analytical approach.
It was evident that some candidates did not abreast themselves of
the latest amendments in the legislation and in SEBI guidelines, listing
agreement etc.
In Question No.1 (a) and (b), many candidates were not aware of
the exact provisions of the Company Secretaries Act, 1980 and in
part (c), the provisions of SEBI (DIP) Guidelines, 2000 were not dwelt
upon by a majority. Answers to Question No. 2 were also not found
satisfactory as the candidates, on the one hand failed to list out the
forms and documents to be filed, and on the other hand, did not
discuss the manner of verifying the accuracy of these documents. In
Question No.3, the candidates could not detail the provisions of listing
agreement properly and were also found to be ignorant of EDP
Student Company Secretary
procedures with respect to rematerialisation of securities. Answers
to Question No.4 were found to be of average level. However, in
Question No.5 (a), many candidates were not aware of the
amendments to CARO 2003 in respect of related party transactions.
Also in Question No.5(c), the candidates could not deliberate upon
the rationale of avoiding excess inventory in business. Answers to
Question No.6 (a) and (b) were generally found to be satisfactory
except that some of the candidates did not touch upon the mechanism
of avoiding sickness through efficiency audit. Question No.7 on
systems audit was generally answered fairly well.
Candidates are advised to imbibe the dynamism of corporate
sector and update their knowledge accordingly. Quoting irrelevant
aspects in answers should be strictly avoided and practical application
of legal expressions should be emphasized upon. Candidates are
also advised to refer to various journals, Bare Acts and access
websites to be conversant with the latest developments.
4. FINANCIAL , TREASURY AND FOREX
MANAGEMENT
Candidates in general showed satisfactory performance in this
paper. Answers to part (a) and (b) of Question No.1 on internal treasury
control and public deposits were satisfactory but candidates wrote
general answers on the concepts of lease financing and EVA asked
in part (c) and (d) of Question 1 respectively. Candidates wrote
satisfactory answers to part (a) of Question No.2 on tools to cover
foreign exchange rate risk. Question No.2 (b) & (c) on factoring and
dividend model was not upto the mark. Question No.3(a) on calculation
of rate of interest was well attempted by the candidates, though most
of the candidates failed to solve Question No.3(b) on portfolio
management. Also the candidates could not calculate the leverages
and EBIT asked in part (c) of the Question 3 properly. Candidates
performed well in all the five parts of Question No.4 relating to
differentiation between various concepts. Candidates attempted
Question No. 5(a) on credit rating quite well. They were also able to
calculate EPS and cost of capital asked in Question 5(b) properly.
However, candidates failed to calculate the adjusted net present value
of projects from the given information in Question 5(c). Answers to
both the parts of Question No.6 relating to spot and forward rates
and calculation of values of put option and call option were
unsatisfactory. Candidates were able to attempt Question No.7 on
capital requirements and rate of cash generation per year satisfactorily.
Candidates are advised not to restrict themselves to the study
material only. They should also refer to standard text books and
financial dailies and have thorough understanding of the subjects for
conceptual clarity.
5. CORPORATE RESTRUCTURINGLAW AND
PRACTICE
In this paper, lack of fundamental clarity and practical knowledge
on the subject was clearly evident. Many candidates failed to quote
the relevant case law to support their answers and exhibited poor
presentation skills.
In Question No.1(a) most of the candidates could not understand
the requirement of the Question. They could not comprehend that
they were required to state the course of action to be taken after
receipt of order of the High Court and filing of documents/order with
the relevant authorities but candidates had given detailed procedure
for filing of petition before the High Court. They could not differentiate
between pre-merger and post merger activities. Similarly part (b) was
also not properly understood by majority of candidates and they wrote
answers based on Section 77A. They could not understand the
requirement of Section 77A viz-a- viz Sections 391-394 of the
Companies Act, 1956. In Question No.2(a) candidates could not give
precise details of documents required to be placed before the Board
and in part (b) majority had very little idea on drafting a petition. The
answers to both the parts of Question No.4 were satisfactory. However,
in part (b) many have written true or false without giving sufficient
25 April 2006
 ACADEMIC GUIDANCE
reasoning. Most of the candidates had avoided Question No.5 and
those who answered, could not give logical answer. Question No.6
was well answered by majority except part (c) for calculating the
minimum offer price. In Question No.7, many candidates did not give
any reference of case laws.
Candidates at final level are advised to concentrate on practical
aspects of law. More stress should be laid on application of law to
practical situations. Answers should be to the point and have a
conclusion. Candidates can improve their drafting skills by reading
the petitions/applications filed in the Court(s). The understanding of
the basic concepts would enable the candidates to present their
answers in a better way. Regular reading of the Chartered Secretary,
Student Company Secretary and corporate journals like Corporate
Courier, Corporate Law Advisor, Company Law Journal, etc. can
immensely improve the quality of answers.
6. BANKING AND INSURANCE LAW AND
PRACTICE
It was observed that some candidates wrote answers in very casual
way without thorough preparation of the subject. The understanding
of concepts and principles were missing in most of the answers.
Answers to Question No.1 on various application oriented/ practical
questions were satisfactory. However, some candidates wrote
irrelevant answers also. Candidates attempt to Question No.2 (a) on
financial sector reforms and part (b) on the procedure followed by the
National Housing Bank were of average standard. Comparatively,
less number of students attempted this question particularly part-b.
Few students failed to write clearly the mission of banking sector in
India. Answers to Question No.3(a) on precautions of a bank before
opening letter of credit and 3(b) on notes on treasury management
and approved and non-approved securities for banks were satisfactory.
Some candidates could not explain CIBIL. The performance of the
candidates for the Question no.4 on CAMELS, virtual distribution,
garnishee order nisi and garnishee order absolute, and credit control
method were good. Surprisingly students were not aware about
amended definition of cheque. Answers to Question No. 5 which was
application oriented were satisfactory in majority of cases. Candidates
attempt to Question No. 6 on role of ECGC in risk management and
on concept of subrogation and Question No.7 on IRDA, marine
insurance policies etc. were disappointing.
Candidates are expected to have exposure in both principles and
application of laws. For securing good marks, they are advised to
read latest books, journals and magazines relevant to the subject.
7. WORLD TRADE ORGANISATION-
INTERNATIONAL TRADE, JOINT VENTURES
AND FOREIGN COLLABORATIONS
The performance of the candidates in this paper was found to be
reasonably well. However, the level of knowledge expected from
candidates of final course was missing.
In Question No. 1 consistency required was found to be missing
and candidates failed to reply on topics like TRIMs and Trade Policy
review in a logical manner. In Question No. 2, performance of the
candidates was average. However, answers to part (a) showed that
candidates did not understand the question properly as a result most
of the candidates gave wrong answers. Question No.3 was attempted
correctly by most of the candidates, except for part (a), where
candidates lacked precision. Answers to Question No. 4 were written
fairly well. Most of the candidates performed well in this question .
However, lack of preparation was apparent in Question No. 5 and
answers to part (a) were not correctly written by most of the candidates
. Performance of candidates in Question No. 6 showed that candidates
were having grasp of the subject in question, which reflected in their
answers. Overall performance in Question No. 7 was satisfactory but
the desired clarity and understanding of the subject was missing.
Answers to Question No. 8 were given correctly by most of the
candidates though the reasoning given was inadequate.
This paper requires continuous updation of knowledge and
Student Company Secretary
candidates are expected to be well versed with latest developments
in the international trade, regional developments and developments
at WTO for scoring good marks. Candidates are advised to develop
analytical and logical skills and improve their presentation skills.
8. DIRECT AND INDIRECT TAXATIONLAW AND
PRACTICE
The performance of the candidates in this paper was not so good
as expected in such type of paper, which was balanced with a mixture
of numerical questions, questions based on case laws, theory
questions etc. Few candidates even described about customs duty
and service tax while answering questions in Part A, whereas Part A
is exclusively for Direct Taxes. In Part B education cess was also not
computed correctly, which was recently introduced. Knowledge of
case laws was also poor as evident in most of the answers.
Candidates lacked the comprehensive knowledge of the subject,
logical and methodical presentations.
The performance of the candidates in Question No.1 was very
poor as only very few candidates had knowledge about the provisions
of Sections 10B and 271(1)(c) of the Income-tax Act, 1961. In Question
No. 2 (a) candidates failed to compute the amount of deduction under
Section 80JJAA of the Act. In Question No.4(a) candidates were not
aware of the terms pertaining to input service distributor and output
service under the CENVAT Credit Rules, 2004. In part (d) candidates
were not aware of the provisions of Service Tax Rules, 1994. In
Question No. 5 (b) some candidates explained additional duty as
anti-dumping duty. In Question No. 6 the answers were not supported
with relevant case laws. In Question No. 7 candidates displayed lack
of knowledge of method of computation of Education Cess and the
provisions of CENVAT Credit Rules, 2004.
Candidates are advised to study the provisions of Income-tax Act
as well as the relevant indirect tax laws very thoroughly. Conceptual
knowledge needs to be improved. Candidates are advised to avoid
writing unnecessarily lengthy and vague answers. It is the quality of
answers, rather than numbers of pages decide the score. In a paper
like Taxation, the approach of the candidates should be more specific
and analytical rather than general.
9. HUMAN RESOURCE MANAGEMENT AND
INDUSTRIAL RELATIONS
The overall performance of the candidates in this paper was just
satisfactory. Some wrote very good answers citing correct case laws
and legal provisions. At the same time many did not display in-depth
knowledge of the subject. Candidates were lacking in clarity,
expression and analytical approach. Irrelevant matter and bad
communication skills were common deficiencies in many of the
answers.
The answers written to the case study in Question No.1 were not
satisfactory. Many wrote general answers. The performance in
Question No.2 and 3 was generally good. Very few answered Question
No.4 (b). Question No.5 was poorly attempted. Many could not justify
whether the appeal to High Court should be allowed or dismissed..
Majority of the candidates did fairly well in Question No.6. Question
No.7 was not attempted up to the mark. No reasoning was given in
Question No.7 (b) and Question No. 7(c) was attempted wrongly by
most of the candidates. Though the performance in Question No. 8
was comparatively better, nevertheless candidates were lacking
knowledge about relevant legal provisions and logical reasoning in
Question No. 8(a) and 8(b).
Candidates are advised to read the study material along with
suggested readings to have adequate knowledge about the subject.
They should read Bare Acts and latest case laws to have thorough
knowledge about the legal provisions as well the knowledge of the
latest judicial decisions. Besides, they are advised to read Chartered
Secretary, Student Company Secretary and other professional Journals
to keep themselves abreast of the latest developments on the subject.
Candidates should write precisely and to the point answers and lay
emphasis on improving presentation skills to score more marks.
26 April 2006
 LEGAL WORLD
LEGAL WORLD
Compiled by T.K.A. Padmanabhan, FCS, Advocate, New Delhi.
CORPORATE LAWS
LW(S) 22.04.2006
DOVE INVESTMENTS PVT LTD v.GUJRAT INDUSTRIAL
INVESTMENT CORPORATION & STERLING HOLIDAY RESORT
(INDIA) LTD V.GUJARAT INDUSTRIAL INV.CORPORATION LTD
[JT 2006 (2) SC 164; (2006) 129 Comp Cas 929; (2006) 71 CLA 112
(SC); (2006) 66 SCL 89 (SC)] S.B.Sinha & P.K.Balasubramanyan,
JJ. [Decided on 2.2.2006]
Companies Act, 1956-Section 108- Transfer of shares-Time period
for lodging share transfer form- Appellants taking huge loan from
the respondent- Directors pledging their shares- Default in
repayment- Respondent filing share transfer form with the
company after the expiry of the specified time period- Whether
company is right in rejecting the transfer of shares- Held, No.
Brief Facts : The appellants took huge loans from the respondent
corporation and the directors of the appellants pledged their shares
with the respondent as security for the loans. When default committed,
the respondent filled in the share transfer form and lodged the pledged
shares with the appellants for transferring the same in its name. The
appellants refused to transfer the shares contending that share transfer
forms were lodged after the expiry of the time period specified in
section 108. The CLB allowed the petition of the respondent and
directed the appellants to register the shares. Against the order of
the CLB the appellants appealed to the Madras High Court, which
confirmed the CLB order. Hence the appellants approached the
Supreme Court under special leave petition.
Decision : Appeals dismissed.
Reasons : A company may refuse to register shares for various
reasons. In this case, however, the shares being freely transferable
refusal for transfer can be made only on limited grounds. Some such
grounds may be that the transfer is malafide or transferee is not a
bonfide investor or transfer is not permissible in terms of one or the
other provisions of the articles of association or the same is otherwise
prohibited in law. However, before the company can be asked to
perform its duties in terms of the said provisions, the procedural
requirements contained in section 108 are required to be complied
with. Section 108 requires the applicant desiring to obtain the
registration of transfer of shares in its favour to comply with the
provisions contained therein. It is, therefore, ordinarily for the applicant
to comply with all formalities. If it does not do so it cannot make the
company bound to effect the transfer, unless sufficient and cogent
reasons are assigned. The time is specified in the aforementioned
provisions for filing of such an application in the prescribed form and
upon complying with the requirements prescribed therein.
[After going through several of its judgments, the court concluded
that the non prescription of penal consequences for not complying
with the requirement as to time for filing share transfer form indicates
that the requirement as to time was only directory and not mandatory.]
However, even if a statute is directory in nature the same should be
substantially complied with. What would satisfy the requirements of
substantial compliance, however, would depend upon the fact of each
case. The fact that the appellant had taken a loan of Rs.4.5 crores is
also not in dispute. Furthermore, we are of the opinion that by reason
of the impugned judgment no injustice as such has been done to the
appellants and in that view of the matter this court in exercise of its
jurisdiction under article 136 of the constitution of India may not interfere
with the impugned order, even if it may be lawful to do so.
LW(S) 23.04.2006
PASUPATHI FABRICS LTD v. PRIANKA OVERSEAS PVT LTD &
ORS [(2006) 71 CLA 84 (Del)] A.K.Sikri, J. [Decided on 5.12.2005]
Companies Act read with SICA-Scheme sanctioned by the BIFR-
Student Company Secretary
Allotment of shares made to IDBI without following the procedure
provided in the Act- Whether this constitute oppression Held,
No. Whether with respect to a sanctioned scheme the CLB has
jurisdiction- Held, No.
Brief Facts : The petitioner company was before the BIFR and a
rehabilitation scheme was framed by the BIFR. As per the scheme
the petitioner was required to reduce its authorized capital by 35 %,
issue fresh equity shares to IDBI for Rs.23 Crores at par and the buy
back of shares issued to IDBI by the promoters of the company. The
respondents were not shown as promoters before the BIFR and the
application filed by the respondent to treat them also as promoters
was dismissed by the BIFR against which an appeal was preferred
before the AAFIR which was pending. The respondents moved the
CLB under sections 397/398 alleging oppression and
mismanagement. The CLB admitted the petition and directed the
petitioner to reduce the authorized capital, treat them as promoters
and also to cancelled the allotment made to IDBI. against the order
of the CLB both the petitioner as well as the respondents appealed to
the High Court. IDBI also appealed to the High court. all the three
appeals were decided by a common order.
Issues raised : Whether a petition under 397/398 of the Act
maintainable before the CLB with respect to a scheme sanctioned by
the BIFR?
Whether allotment made to IDBI could be cancelled?
Whether respondents were also promoters?
Decision : CLB order set aside.
IReason:
Re. Issue 1. Jurisdiction of CLB
From the date of registration of reference, there is complete
takeover by the BIFR which assumes total control and the company
is to function thereafter as per the mandate of the BIFR. It is the
BIFR which has to decide how the company is to be rehabilitated and
sanction the scheme, which would be a package deal, for operation
of the functioning of the company. The company has to thereafter
function as per the provisions of the scheme sanctioned. As noted
above, these provisions may provide for the complete takeover by
the new management, new board of directors, new constitution of
the company, with altered memorandum and articles of association
and even reduction of the interest or rights of the existing shareholders
and allotment of shares of such company to some other persons,
particularly, the creditors. For providing such measures in the
sanctioned scheme, procedural requirements contained in the
Companies Act, which are to be generally followed when the company
is not sick, are not to be gone into. Once the legal position and scope
of the two Acts i.e Companies Act and SICA is under stood, the
irresistible conclusion would be that for all matters relating to a
sanctioned scheme, it is the BIFR alone which shall the jurisdiction.
Therefore, the CLB had no jurisdiction to entertain a petition under
section 397/398 of the Act.
Re: Allotment to IDBI
It is clear that the expression to accept is in mandatory form and
amounts to a direction given by the BIFR in the scheme. Same
terminology is used for dealing with other secured creditor, namely,
State bank of India. Needless to mention what is approved by the
BIFR is the sanctioned scheme of rehabilitation. Different provisions
are made as to how this scheme is to be implemented, Action to be
taken for implementation thereof would be in the nature of direction.
The provision made in the scheme that inso far as provisions of
sections 81(1) and 100-103 of the act are concerned the CLB may
consider exempting the company from these provisions is superfluous.
Admittedly, the CLB has no jurisdiction in the matter. Such an
exemption, if at all, can be granted by the High court and, if
necessitated, even the BIFR can grant such exemption for proper
implementation of the scheme. Therefore, there was no need for the
company to approach the CLB for granting such exemption even
though the BIFR had passed such an order.
27 April 2006
 LEGAL WORLD
Re: Promoters
No doubt the grievance of the respondents that by not accepting
them as promoters and not allowing them to purchase the shares
from IDBI reduces them to the status of minority and allows the other
party to gain control over the petitioner company. It is for the
respondents to urge this issue before the AAIFR by contending that
the BIFR should not have dismissed their application on the grounds
of laches and delay and the issue should have been decided on the
merits.
GENERAL LAWS
LW(S) 24.04.2006
SVAPN CONSTRUCTIONS v. IDPL EMPLOYEES CGHS LTD
[127(2006) DLT 80] Anil Kumar, J. [Decided on 20.12.2005]
Arbitration and Conciliation Act, 1996- Section 11(6)- Civil
Procedure Code, 1908- Order 30- Petition for the appointment of
arbitrator- Petition in the name of sole proprietorship firm-
Whether maintainable- Held, No.
Brief facts : The petitioner is a sole proprietorship firm that had a
contract with the respondent. Since disputes arose, the petitioner
filed a petition in the High court for the appointment of arbitrator. The
petition was filed in the name of the firm. The respondent objected to
the petition, inter alia, on the ground that a sole proprietorship firm is
not a legal entity and as such the petition was not maintainable.
Decision : Petition dismissed.
Reason : Perusal of the petition reveals that petition has been filed
in the name of sole proprietorship firm, which is not a legal entity,
through its sole proprietor. A sole proprietorship firm is not a legal
entity which can sue in its own name though any two persons claiming
or being liable as partners and carrying on business may sue or be
sued in the name of firm of which such persons are partners at the
time of accruing of cause of action, however under Order 30 of the
CPC and under any provision of the Code a person carrying on
business in a name other than his can sue in the name other than
his. In the petition filed by the petitioner no prayer has been made
seeking amendment to sue in the name of the sole proprietorship
firm. Even according to the averments made in the petition, though it
is stated that Mr.A.K.Khanna is the sole proprietor of the firm, M/s.
SVAPN Constructions, however, no permission has been sought to
sue in the name of the sole proprietorship firm. If the sole proprietorship
firm is not a legal entity, the petition should have been filed by the
sole proprietor in his name on behalf of his sole proprietorship firm
and not in the name of sole proprietorship firm. Considering it from
any point, the inevitable inference is that a petition in the name of a
sole proprietorship firm which is not a legal entity is not maintainable.
TAX LAWS
LW(S) 25.04.2006
COMMISSIONER OF CENTRAL EXCISE v. PAN PIPES
RESPLENDENTS LTD [JT 2006 (2) SC 562] Ashok Bhan &
C.K.Thakker, JJ. [Decided on 1.12.2005]
The Central Excise Act, 1944-section 2(f)- Manufacture- Assessee
applying drying and colouring to convert plain glazed tiles into
decorated glazed tiles- Department considered the processes
as manufacture- Assessee denied it- Whether the process applied
by the assessee amounts to manufacture- Held, No.
Brief Facts : The respondent-assessee procured duty paid plain
ceramic glazed tiles and processed them into decorated glazed
ceramic wall tiles by applying drying and colouring processes. The
appellant -department considered these process as manufacture and
demanded excise duty from the respondent. The respondent
challenged the duty contending that the processes applied by it was
not amounting to manufacture. After passing through all the lower
tax adjudicating authorities and the Tribunal, finally the issue landed
in the Supreme Court.
Student Company Secretary
Decision : Appeal dismissed.
Reasons : The point which falls for consideration in this case is
whether printing/decorating of duty-paid plain glazed ceramic tiles
amounts to manufacture or not. The process for amounting to
manufacture must be one which brings into being a new substance
known to the market. Manufacture implies a change but every change
is not a manufacture and yet every change in an article is the result of
some treatment, labour and manipulation. For manufacture something
more is necessary. There must be transformation and a new article
must result, having a distinct name character or use.
These conditions are not satisfied in the instant case because
ceramic glazed tiles remain ceramic glazed tiles even after the process
of printing and decorating. Transformation of a product must be such
that it becomes a commercially different commodity to attract central
excise duty and unless a new and distinct article known commercially
to the market emerges, the process would not amount to manufacture.
In the present case no distinct commodity comes into being as a
result of process carried out by the respondent. It is not the case of
the Department that ceramic glazed tiles which are subjected to
printing and decoration would be commercially useless but for the
process carried out by the respondent. In the present case the
decorated glazed ceramic wall tiles after their decoration did not
change their basic character viz glazed tiles and therefore did not
undergo a process of manufacture.
LW(S) 26.04.2006
BSNL & ORS v. UNION OF INDIA & ORS [JT 2006 (2) SC 562]
Ruma Pal, Dr.A.R.Lakshmanan & Dalveer Bhandari, JJ. [Decided
on 2.3.2006]
Land line connection by telephone companies- SIM card for
providing connectivity to mobile phone users- Whether sales
tax is applicable to them Held, No. Whether they can be
subjected to service tax as well as sales tax- Held No.
Brief facts : The instant case involves question of law. Telecom
operators including BSNL and mobile operators were assessed under
the Service Tax provisions as the telecom services were taxable
services. Besides this, they were subjected to sales tax by the States
on the rentals charged by them on the ground that they had transferred
right to use goods by charging rental. In short, the provision of telecom
services was taxed as service by the Center as well as goods by the
States. The High Courts of Allahabad, Andhra Pradesh and Punjab &
Haryana held that provision of telecom services cannot be considered
as sale of goods. However, the Kerala High Court had held that provision
of telecom services can be taxed as services as well as goods. Further,
the Supreme Court had also held that Department of Telecom is a
dealer under the UP Trade Tax Act and liable to be taxed as such. All
the aggrieved Telecom operators appealed to the supreme court for
the determination the issue whether provision of telecom services be
subjected to sales tax as well as service tax.
Decision and Reason : The judgment focuses on land line
connectivity and mobile connectivity.
Re: Land line connectivity Section 4 of the Telegraph Act,1885
gives exclusive privilege in respect of telecommunication and the
power to grant licences to the Central government. Pursuant to such
power, licences have been granted to service providers. According to
the service providers in terms of their licence no further transfer of
rights to use the telegraph could be affected by them. Therefore,
what was provided was a service by the utilization of the telegraph
licenced to the service providers for the benefit of the subscribers. It
is clear, electromagnetic waves are neither abstracted nor are they
consumed in the sense that they are not extinguished by their user.
They are not delivered, stored or possessed. Nor are they marketable.
They are merely the medium of communication. What is transmitted
is not an electromagnetic wave but signal through such means. The
signals are generated by the subscribers themselves. In
telecommunication what is transmitted is the message by means of
telegraph. No part of the telegraph itself is transferable not deliverable
to the subscribers.
28 April 2006
 LEGAL WORLD
A subscriber to a telephone service could not reasonably be taken
to have intended to purchase or obtain any right to use electromagnetic
waves or radio frequencies when a telephone connection is given.
Nor does the subscriber intend to use any portion of the wiring, the
cable, the satellite, the telephone exchange etc. At the most the
concept of the sale in a subscribers mind would be limited to the
hand set that may have been purchased for the purpose of getting a
telephone connection. As far as the subscriber is concerned ,no right
to the use of any other goods, incorporeal or corporeal, is given to
him or her with the telephone connection.
In our opinion, the essence of the right under article 366 (29A)(d0
is that it relates to user of goods. It may be that the actual delivery of
the goods is not necessary for effecting the transfer of the right to
use the goods but the goods must be available at that time of transfer,
must be deliverable and delivered at some stage. It is assumed, at
the time of execution of any agreement to transfer the right to use,
that the goods are available and deliverable. If the goods, or what is
claimed to be the goods by the respondents, are not deliverable at all
by the service providers to the subscribers, the question of the right
to use those goods, would not arise.
But if there are no deliverable goods in existence as in this case,
there is no transfer of user at all. Providing access or telephone
connection does not put the subscriber in possession of the
electromagnetic waves any more than a toll collector puts a road or
bridge into the possession of the toll payer by lifting a toll gate. Of
course the toll payer will use the road or bridge in one sense. But the
distinction with a sale of goods is that the user would be owner of the
thing or good delivered. The delivery may not be simultaneous with
the transfer of the right to use. But the goods must be in existence
and deliverable when the right is sought to be transferred.
Re: SIM card It is not possible for this court to opine finally on the
issue. What a SIM card represents is ultimately a question of fact. In
determining the issue, however the assessing authorities will have to
keep in mind the following principles. If the SIM card is not sold by
the assessee to the subscriber but is merely part of the services
rendered by the service providers, then a SIM card cannot be charged
separately to sales tax. It would depend ultimately upon the intention
of the parties. If the parties intend that the SIM card would be separate
object of sale, it would be open to sales tax authorities to levy sales
tax thereon. However, we emphasise that if the sale of the SIM card
is merely incidental to the service being provided and only facilitates
the identification of the subscribers. their credit and other details, it
would not be assessable to sales tax.
LW(S) 27.04.2006
SAJ FLIGHT SERVICES P LTD v. SUPERINTENDENT OF CENTRAL
EXCISE [(2006) 3 STT 165 (KER)] C.N.Ramachandran Nair, J.
[Decided on 17.8.2005]
Finance Act, 1994- Service tax- Section 65 (24) and 65 (76A)-
Caterer and outdoor caterer- Petitioner supplying food and
beverages to air companies- These food and beverages are to
be served to the passengers on flight- Whether supply of food
and beverage to air companies liable to service tax as catering
service- Held, Yes.
Brief Facts : The petitioner was supplying food and beverages to air
companies. The service tax authorities issued show cause notice on
the petitioner demanding service tax on such supplies made to air
companies. The petitioner challenged the demand by way of a writ
before the Kerala High Court.
Decision : Petition dismissed.
Reason : The word purpose or occasion referred to in the definition
of caterers refers to the customers. In other words, supply or service
is to meet any purpose of the customer or for any occasion arising to
the customer. There is nothing to indicate in the definition clause that
such purpose or occasion should be rare or occasional and should
not be frequent or even regular. Service of food and beverages to
passengers during flight was the purpose for which Air companies
took the supplies from the petitioner. The petitioner admittedly supplied
the items on board flights. So much so the activity of the petitioner
squarely fell with in the definition clause contained in section 65 (76A),
read with section 65(24). Therefore, regular supply of food and
beverages by the petitioner to Aircrafts under orders from air
companies would attract liability to tax.
The outdoor caterers supply food and beverages in accordance
with the terms of supply to the Air companies. It may be in airports, or
aircrafts or any other place. So long as the supply is not in the premises
of the caterer, it is outdoor catering. the word place, referred to in
section 65(76A) has no artificial or technical meaning. Therefore,
service anywhere outside the caterers place would attract liability
under section 66.

Attention Students!

SUBSCRIPTION TO CHAR TERED

CHARTERED
SECRETAR
SECRETAR
ARYY
Students may perhaps be aware that the Institute has been bringing out a monthly journal Chartered Secretary for corporate
professionals for the last over thirty-five years. The journal is rated to be one of the best professional journals consistently
maintaining high standards in providing Government notifications, legal decisions and analytical and informative articles. The
journal is not only important for corporate professionals, members of the Institute and lawyers but is equally important for students
for keeping them well informed about the latest changes and developments.This in turn will not only help the students to write
their examinations well but will also help them to step into the professional world with confidence. The Legal World section
provides all the latest and important cases, the From the Government column provides changes/ amendments in various
statutes/Laws/Rules etc. and the Articles section provides informative and analytical articles on contemporary topics.
The concessional annual subscription of the journal is Rs. 300/- for the Registered Students of the Institute. It is in the
interest of the students to subscribe to the Journal. Students interested in receiving the monthly journal Chartered Secretary
may send a Demand Draft favouring the Institute of Company Secretaries of India for an amount of Rupees 300/- and forward the
same to :
Joint Director (Publications)
The Institute of Company Secretaries of India
22, Institutional Area, Lodi Road, New Delhi-110003.

Student Company Secretary 29 April 2006

 STUDENTS SERVICES
STUDENTS SERVICES
REGISTRATION AND POSTAL TUITION
1. CANCELLATION OF REGISTRATION
Registration of students registered upto and including May, 2001
stands terminated on expiry of five-year period on 30th April, 2006
leading to the following immediate consequences :
(a) Supply of Student Company Secretary bulletin will be
discontinued from May, 2006 onwards.
(b) Response sheets will not be accepted even if submitted and
coaching completion certificates will not be issued (after the expiry
of registration period)
They are advised to apply for registration de novo/extension of
registration as per the guidelines published in this bulletin.
(Students whose registration is valid upto February, 2006 are
however, eligible to appear in June, 2006 examination without
seeking extension of registration/ registration de-novo subject
to fulfilling other requirements laid down in the regulations.)
2. CHANGE OF ADDRESS
Change of address, if any, should be intimated to the Institute by
sending a separate letter in this regard. While intimating the change
in their mailing address, the students are advised to invariably quote
the PIN CODE number alongwith the student registration number,
name and full postal address with city, state in capital letters.
PIN CODE is required to be mentioned for quick delivery of
the mail. Students may, therefore, check up the computerised
mailing address as printed on the Student Company
Secretary bulletin. In case, it does not carry or carry the wrong
PIN CODE number, the same may be intimated immediately
quoting student registration number and full postal address
with Postal Index Number so that it could be incorporated in
the computerised mailing list.
3. STUDENTS IDENTITY CARD
All the students appearing in the examination must hold Identity
Card in the manner prescribed by the Institute, if not already obtained
at the time of seeking registration. For obtaining the Identity Card,
students are advised to obtain a proforma from the Headquarters/
Regional Offices of the Institute and send it again to the Institute duly
filled up and attested as per instructions given in the prospectus/
registration letter.
Students who have so far not obtained Identity Cards are advised
to write to the Institute immediately. The students should carry their
Identity Cards without fail for appearing in the Institutes examination.
If the Identity Card already issued has been lost or mutilated, student
should send a request for obtaining duplicate Identity Card together
with the mutilated Identity Card/Identity Card proforma duly filled in
and attested together with Rs. 50/- towards duplicate Identity Card fee.
4. COMPULSORY ENROLMENT FOR FINAL
COURSE
Students who have passed/completed both groups of Intermediate
examination are advised to seek compulsory enrolment for undergoing
coaching for the Final course on payment of Rs.4200/- towards postal
tuition fee.
Please note that a student is admitted to the final examination
only after a minimum period of nine calendar months has elapsed
since his/her passing the Intermediate examination and subject to
completion of coaching and fulfillment of other requirements.
Student Company Secretary
5. ISSUE OF ADMISSION CERTIFICATES FOR
JUNE, 2006 EXAMINATION
The admission certificates for June, 2006 examination to all the
eligible students will be dispatched, by ordinary post, from 1st May,
2006. Simultaneously, the Admit Card Extracts would be uploaded in
the website of the Institute viz. www.icsi.edu by 1st May, 2006.
All the students are hereby advised to carefully check up the
particulars viz. Name, Centre, Medium, Group, Exemptions granted,
etc. shown in the Admit Card Extracts which would be available on
the website of the Institute from 1st May, 2006. If they come across
any discrepancy, it should at once be brought to the notice of
T P Balasubramanian, Desk Officer for verification/rectification.
Updated Admit Card Extracts would be uploaded in the website of
the Institute by 15th May, 2006.
While the requests for duplicate Admission Certificates would
promptly be attended to by the Headqurters, students may, as per
their convenience, also download Admit Card Extract from the website
of the Institute which alongwith the Student Identity Card issued by
the Institute would be equally valid for appearing in the CS
Examinations.
Alternatively, the students may approach Regional/Chapter/
Satellite Chapter Offices for issue of duplicate Admission Certificates
from 26th May, 2006.
6. CLARIFICATION REGARDING PAPERWISE
EXEMPTION
(a) The paperwise exemption is granted only on the basis of specific
request received in writing from a registered student along with
the attested photocopies of marks sheets for all parts of the
Degree/examination (on the basis of which the paperwise
exemption is sought) and the exemption fee @ Rs. 100/- per
paper. It is one time payment and not to be remitted for availing
of paper wise exemption in every session of examination during
the validity of registration period.
(b) The application for claiming paperwise exemption must reach
the Institute on or before the last date for submission of enrolment
application i.e. 25th March and 25th September for June and
December examinations respectively and with a late fee of Rs.
100/-, the application can be accepted upto 9th April and 10th
October respectively.
(c) The paperwise exemption once granted holds good during the
validity of registration period or passing/completing the
examination, whichever is earlier.
(d) The paperwise exemption is cancelled only on receipt of a specific
request in writing from the student concerned on or before the
last date for submission of the enrolment application. If any
candidate appears in the exempted paper(s) of examination
without receiving the written confirmation from the Institute, but
by making personal representation, appeal, request, etc., at the
Examination Centre at the last moment, his/her appearance in
such paper(s) shall automatically be treated as cancelled.
(e) It may be noted that candidates who apply for grant of paper
wise exemption or seek cancellation of paper wise exemption
already granted, before the last date of submission of enrolment
applications for a particular examination, must see and ensure
that they receive written confirmation from the Institute at least
15-20 days prior to the commencement of the examination.
Candidates who would presume automatic grant or cancellation
of paper wise exemption without obtaining written confirmation
on time and absent themselves in any paper(s) of examination
and/or appear in the exempted paper(s) would do so at their
own risk and responsibility and the matter will be dealt with as
per the above guidelines.
(f) Exemption once cancelled on request in writing shall not be
granted again under any circumstances.
30 April 2006
 STUDENTS SERVICES
(g) The candidates who have passed either group of the
Intermediate/Final examination under the old syllabus, may claim
the paperwise exemption in the corresponding subject(s) of new
syllabus indicating the basis of exemption as APO in the
appropriate column of the enrolment application.
(h) In case the paperwise exemption has already been granted on
the basis of qualification or the candidates is eligible for grant of
exemption on the basis of securing 60% or more marks, a
photocopy of the letter/marks-sheet issued by the Institute should
be enclosed with the enrolment application while claiming such
exemption, failing which the same may not be granted for the
ensuing examination.
(i) No exemption fee is payable for availing paperwise exemption
on the basis of APO or on the basis of securing 60% or more
marks in the Institutes examination.
(j) Paperwise exemption fee is payable only when the exemption is to
be availed on the basis of qualification(s) specified for the purpose.
7. IMPORTANT
While making any correspondence regarding examination, the
students are advised to quote the following particulars for taking
prompt action :
(i) Name in full (ii) Student Registration number (iii) Stage of
examination (Intermediate/Final) (iv) Group opted (v) Centre opted
(vi) Particulars of fee remitted, i.e. Demand Draft (printed) number,
date , amount, name of the bank and its branch (vii) Date and mode
of despatch of enrolment application and their complete address with
PIN code, telephone number, mobile number or e-mail address.
In case of any specific problem/complaint regarding registration,
post-registration, students services and postal/oral coaching, students
may contact personally or write to Sohan Lal, Joint Director and for
academic guidance and suggestions, if any, students may write to
V K Aggarwal, Principal Director, at the Institutes address.
UNIFORMITY IN SIGNATURES
It has been observed that some of the enrollment applications/
letters received from the students are either unsigned or bear
different signatures from time to time.
All the students are, therefore, advised to maintain uniformity
in their signatures on all the correspondence with the Institute
including students identity card, enrolment application and
attendance sheet provided in the examination hall at the time of
writing the examination.
EXAMINATI0N
1. JUNE, 2006 EXAMINATION
The next examination for the Foundation Course, Intermediate
and Final, scheduled in June, 2006, will be held from Friday, the 2nd
June, 2006 to Saturday, the 10th June, 2006 at the 64 examination
centers, viz., 1. Agra; 2. Ahmedabad; 3. Allahabad; 4. Ambala;
5. *Aurangabad; 6. Bangalore; 7. *Bareilly; 8. Bhilwara; 9. Bhopal;
10. Bhubaneswar; 11. Chandigarh; 12. Chennai (West); 13. Chennai
(South) 14. Coimbatore; 15. Dehradun; 16. Delhi (East); 17. Delhi
(North); 18. Delhi (South); 19. Delhi (West); 20. Ernakulam;
21. Faridabad; 22. Ghaziabad; 23. Gurgaon; 24. Guwahati;
25. Hyderabad; 26. Indore; 27. Jaipur; 28. Jammu; 29. Jamshedpur;
30. Jodhpur; 31. Kanpur; 32. Kolkata (North); 33. Kolkata (South);
34. Lucknow; 35. Ludhiana; 36. Madurai; 37. Mangalore; 38. Meerut;
39. Mumbai (CG); 40. Mumbai (GTK); 41. Mumbai (Jog); 42. Mysore;
43. Nagpur; 44. Nasik; 45. Noida; 46. Panaji (Goa); 47. Patna;
48. Pondicherry; 49. Pune; 50. Raipur; 51. Rajkot; 52. Ranchi;
53. Shimla; 54. Surat; 55. Thane; 56. Thiruvananthapuram;
57. Tiruchirapalli; 58. Udaipur; 59. Vadodara; 60. Varanasi
61. Vijayawada; 62. Visakhapatnam; 63. Yamuna Nagar (Haryana)
Student Company Secretary
and 64. Overseas Centre Dubai, as per the Time-Table and
Programme published on the last cover page of this issue.
Note: 1. *Aurangabad and Bareilly Examination Centres are
opened purely on experimental basis for June, 2006
and December, 2006 sessions only.
2. The Institute reserves the right to withdraw any centre
at any stage without assigning any reason.
The addresses of the examination centres will be published in the
forthcoming issue of this bulletin for general information.
2. USE OF CALCULATORS IN EXAMINATIONS
Candidates are allowed to use their own battery operated noiseless
and cordless pocket calculators with not more than 6 functions, 12
digits and 2 memories. Exchange or lending/borrowing of calculators
among students will not be allowed in the examination hall.
3. HINDI AS AN OPTIONAL MEDIUM FOR WRITING
THE FOUNDATION, INTERMEDIATE AND FINAL
EXAMINATIONS
Candidates are allowed to use Hindi as an optional medium for
writing all papers of the Foundation (except English & Business
Communication paper), Intermediate and Final examinations on
the following conditions:
(i) option of Hindi Medium for writing the examination is to be
exercised for all papers of an examination OR a particular group
of examination, and not for any individual paper(s) in the
enrolment application form each time for appearing in the
examination;
(ii) Option of medium for writing examination, once exercised is
irrevocable for that particular session of examination;
(iii) answer books of candidates who write part of papers/answers in
one medium and the remaining part in other medium are liable
to be cancelled without any notice;
(iv) candidates who have exercised option of Hindi Medium in their
examination enrolment form for writing Foundation examination
and Group-I of Intermediate examination will be provided
Question Papers printed both in English and Hindi (except for
English & Business Communication paper of Foundation
examination which will be printed/required to be answered
in English only). The Question Papers for Group-II of the
Intermediate examination and all papers of Final examinations
will be printed/supplied in English only;
(v) if a candidate writes his answers in Hindi Medium without
exercising such an option in the enrolment application form, he/
she may not be given credit for his/her answers;
(vi) candidates opting Hindi Medium for the examination must write
HINDI MEDIUM in bold letters on the top of the cover page of
Answer Book No.1 and 1B, as the case may be; and
(vii) candidates opting Hindi Medium for the examination may, if they
so desire, write answers to practical questions, headings,
quotations, technical and legal terms, sections, rules, etc., in
English medium.
4. IMPORTANT INSTRUCTIONS TO EXAMINEES
Candidates enrolled for appearing in the June, 2006
examinations are advised to carefully read and observe the
Instructions to Examinees printed on the Admission Certificate
(Roll Number) and enclosures thereto, and also on the Question
Papers and Answer Books. However, attention of candidates is
especially invited to the following instructions:
(i) on receipt of Admission Certificate (Roll No.), first of all, the
candidates must verify carefully the entries appearing therein.
Discrepancy/error, if any, in the Admission Certificate concerning
spellings of his/her name, stage of examination and examination
centre; medium of writing the answers, subject of examination
in which exemption was sought/shown, etc., should, at once be
31 April 2006
 STUDENTS SERVICES
brought to the notice of Shri Sohan Lal, Jt. Director (Students
Services) well on time before the commencement of
examinations;
(ii) candidates are required to bring their Admission Certificates and
Student Identity Cards daily to the Examination Hall failing which
they may not be allowed admission to the Examination Hall and/
or to appear in the examination;
(iii) before attempting to write answers in the answer books,
each candidate must write his/her Roll Number on the special
slip affixed to Answer Book Nos. 1, 1-B and 1-C and date of
examination, stage of examination, name of the paper, etc.,
against the relevant columns on the first page of the main
answer books and also on the top of Question Paper.
(iv) candidates must attempt questions in accordance with the
directions given on each Question Paper. If the questions
are attempted in excess of the prescribed number, only the
questions attempted first upto the required numbers will be
valued and awarded marks and the remaining questions will
be ignored;
(v) Questions relating to graph/prcis should be attempted only on
graph/precis sheets appended as last page to the Answer Book
wherever required. Do not write your roll number on the Graph/
Precies Sheets and additional Answer Book No. 2. The
additional answer book(s) used, if any, should be fastened along
with the main answer book. Candidates who fail to observe this
instruction will be penalised;
(vi) each question should start on a fresh page and sub-question(s)
be attempted consecutively;
(vii) while attempting a fresh question/sub-question, candidates
should distinctly mention respective question number against
the answer in bold capital letters with coloured sketch pen/
different colour ink and underline the same, e.g., ANS. TO Q.
NO. 3(A) on the left-hand side margin of the answer book and
also simultaneously mark a cross (X) in the table provided on
the cover page against the respective question number;
(viii) Candidate must not, for any reason whatsoever, tear out any
page(s) from the Answer Book or leave any blank page or unused
spaces in between the pages. If such spaces are left score
them out. If a candidate uses more than one answer book he/
she should, indicate on the cover page of main answer book,
the total number of answer books used.
(ix) candidates are expected to write precise and to the point
answers to questions set in for the examinations in neat
and legible handwriting citing relevant provisions of the Act/
rules quoting case laws, etc., in support of the answers
wherever applicable;
(x) no candidate shall leave/be allowed to leave the Examination
Hall (i) within first one hour of commencement of
examination, (ii) during last 15 minutes of examination
timing, (iii) without signing the attendance sheet, and (iv)
without properly handing over his/her answer books to the
Invigilator on duty;
(xi) a few minutes prior to the time of conclusion of examination
or before handing over the answer books to the supervisory
staff, candidates must re-check and ensure that they have
filled up all relevant particulars on the cover page of Answer
Book Nos. 1, 1-B and 1-C, as the case may be, and properly
tied-up all the additional answer book(s) No.2 along with
the main answer book;
(xii) candidates should strictly adhere to the instructions given
by the Invigilator(s)/Supervisors in the Examination Hall;
(xiii) candidates are strictly forbidden to carry with them into the
Examination Hall any book or printed/handwritten material,
notes, pager, mobile phone, etc., OR to talk or converse
inter se with other candidates in the Examination Hall;
Student Company Secretary
(xiv) Candidates are further strictly forbidden to copy from the answer
papers of any other candidate nor allow their answers to be copied
nor give nor attempt to give nor obtain nor attempt to obtain
irregular assistance of any description. It will be the responsibility
of each and every candidate to ensure that his/her answers are
not copied by another candidate. Failure to do so will invite
stern disciplinary action and penalty for adoption of unfair means;
(xv) no candidate shall leave his/her seat in the examination hall
during the course of examination without the specific
permission of the Invigilator on duty for any reason
whatsoever;
(xvi) on completion of examination or expiry of the prescribed
examination timing, the answer book must be handed over
immediately to the Invigilator on duty and Invigilators
signatures be obtained in the relevant column of
acknowledgement printed on the Admission Certificate in
token of handing over his/her answer books.
(xvii) it shall be the personal responsibility of the candidate
concerned to properly hand over his/her answer book(s) to
the Invigilator on duty in the Examination Hall and obtain
acknowledgement therefor. Any representation regarding
omission to handover the written answer book(s) or not
obtaining the acknowledgement from the Invigilator at the
time of handing over his/her answer book(s) for any reason
whatsoever will not be entertained after the conclusion of
that particular session of examination;
(xviii) Candidates are warned that any attempt to misbehave in any
manner or create disorderly scene in and around the examination
hall or harass or bodily harm the staff deployed for the conduct
of examination will be viewed seriously and severely punished;
and
(xix) any attempt or act of violation of these Instructions to Examinees
shall be viewed seriously and entail disciplinary action under the
provisions of the Company Secretaries Regulations, 1982.
NOTIFICATION
ICSI NO. 01 OF MARCH, 2006
MERIT-CUM-MEANS ASSISTANCE SCHEME, 1983
In pursuance of para 13 of the Merit-cum-Means Assistance
(Company Secretaryship Course) Scheme, 1983, as amended upto
18th February, 2005, applications are invited to reach the Institute
in the prescribed form on or before 25th May, 2006 for award of 15
numbers of financial assistance each for Intermediate and Final
course of the company secretaryship from students who fulfill the
eligibility criteria laid down under the said scheme.
According to the scheme, a candidate applying for assistance
should have passed Foundation or Both Groups of the Intermediate
examination without exemption in any paper, at one sitting, in the
first attempt in December, 2005 examination. The income of such
a candidate, if employed or is having an independent source of
income, should not be more than Rs.1,00,000 per annum and if
he/she is dependent on his/her parents/guardian/spouse whether
partially or wholly, the combined income from all sources should
not be more than Rs.1,50,000 per annum.
Prescribed application form together with a copy of the Merit-
cum-Means Assistance (Company Secretaryship Course) Scheme,
1983 can be obtained from the Institute free-of-cost by sending a
self-addressed envelope of 23cms. x 11 cms. size duly affixed
with postage stamp worth Rs.10/-. Applications not made on the
prescribed forms and/or without supporting documents, incomplete
applications, applications not fulfilling the eligibility criteria laid down
under the scheme or applications not reaching the Institute on or
before 25th May, 2006 are liable to be rejected.
File No.207:Exams:2006 BY ORDER OF THE COUNCIL
New Delhi 110 003. (N. K. JAIN)
Dated, the 1st March, 2006 Secretary & CEO
32 April 2006
 STUDENTS SERVICES
LIST OF FIRST 25 TOP RANK HOLDERS, IN ORDER OF Sl. Rank Roll Regn. No. Name of the Student
MERIT, WHO HAVE SECURED NOT LESS THAN 55% No. No. and Centre
MARKS IN THE AGGREGATE IN THE FOUNDATION
EXAMINATION DECEMBER, 2005 27. 17 4730 NU0230770 ROSEY GANDHI (MS.),
YAMUNA NAGAR
Sl. Rank Roll Regn. No. Name of the Student
No. No. and Centre 28. 17 6941 WU0142385 BAGESHRI GAJANAN
BHATKHANDE (MS.),
1. 1 7801 WU0143914 AKSHITA AGRAWAL (MS.),
MUMBAI
RAIPUR
29. 18 1108 EU0087844 MANISH DAGA, KOLKATA
2. 2 1139 EU0088277 DIPAK DAGA, KOLKATA
30. 18 1224 EU0089625 SHIKHA RUIA (MS.),
3. 3 1208 EU0089418 AKKAL DUDHWEWALA,
KOLKATA
KOLKATA
4. 4 3650 NU0232062 NIDHI LADIWAL (MS.), 31. 18 3720 NU0235132 SHRUTI CHANDAK (MS.),
JAIPUR JAIPUR

5. 5 1225 EU0089667 SWETA BAJAJ (MS.), 32. 18 7944 WU0141564 SUMEET RAMESHWAR
KOLKATA SABU, NASHIK
6. 6 5488 SU0081514 MADHUMITHA M (MS.), 33. 19 1091 EU0087637 MOHIT KEJRIWAL,
CHENNAI KOLKATA
7. 7 1409 EU0092747 MINI BAGARIA (MS.), 34. 19 1261 EU0090313 ATISH KUMAR SINGH,
KOLKATA KOLKATA
8. 7 3928 NU0239124 AKASH PHOPHALIA, 35. 19 2128 NU0240115 SANCHI AGARWAL (MS.),
JODHPUR AGRA
9. 7 5320 SU0079154 SUSHMA A S (MS.), 36. 19 2740 NU0206009 ANURADHA SINGHANIA
BANGALORE (MS.), DELHI
10. 8 5453 SU0080507 NAGARAJ B S, CHENNAI 37. 20 2894 NU0239528 RICHA MUNUJA (MS.),
11. 8 6800 WU0141651 SRINATH NARASIMHAN, DELHI
MUMBAI 38. 20 3346 NU0228692 VIPUL AGARWAL, DELHI
12. 9 1223 EU0089611 ANKIT MATHRAN, KOLKATA 39. 20 5730 SU0078269 LALITHA R (MS.),
13. 9 6037 SU0080580 MOTHI HAREESH V, HYDERABAD
TIRUCHIRAPALLI 40. 21 1249 EU0090195 SUMIT RUNGTA, KOLKATA
14. 10 1415 EU0092811 MOHIT JAIN, KOLKATA
41. 22 1239 EU0090068 AMIT SARAF, KOLKATA
15. 11 1414 EU0092806 SANDEEP AGARWAL,
42. 22 1277 EU0090498 RITIKA RATHI (MS.),
KOLKATA
KOLKATA
16. 12 856 EU0075371 NEHA DUGAR (MS.),
43. 22 5433 SU0077963 BHUVANASUNDAR S ,
KOLKATA
CHENNAI
17. 12 1407 EU0092710 PANKAJ CHOUDHARY,
KOLKATA 44. 22 5445 SU0079234 SWETHA T V (MS.),
CHENNAI
18. 12 3356 NU0229668 NISHA AGGARWAL (MS.),
DELHI 45. 23 1075 EU0087313 DIPTI BAJAJ (MS.),
KOLKATA
19. 12 5456 SU0080561 SNEHA DHARAM CHAND
JAIN (MS.), CHENNAI 46. 23 1100 EU0087743 ISHA AGARWAL (MS.),
KOLKATA
20. 13 5463 SU0080782 KRISHNA KUMAR S,
CHENNAI 47. 23 1430 NU0191171 SUMIT BATHWAL, KOLKATA
21. 14 3644 NU0231974 GARIMA GARG (MS.),
JAIPUR 48. 23 5732 SU0078801 YOGITA DEEPAK NAGADA
22. 15 4657 NU0238552 SIDDHARTH JAIN, UDAIPUR (MS.), HYDERABAD
49. 24 1134 EU0088221 SOURABH AGARWALA,
23. 15 5392 SU0063836 A SUNEEL, CHENNAI KOLKATA
24. 16 1335 EU0091479 VIRENDRA SHARMA, 50. 25 1365 EU0092009 PRATIK DROLIA, KOLKATA
KOLKATA 51. 25 2877 NU0237242 SHEFALI GUPTA (MS.),
25. 16 3651 NU0232078 SAMRIDHI KOTHARI (MS.), DELHI
JAIPUR 52. 25 6636 WU0144225 RAHUL SINGHAL, INDORE
26. 17 1421 EU0092895 SMITA SARAOGI (MS.), 53. 25 7133 WU0142056 CHINTAN DIPAK SHAH,
KOLKATA
MUMBAI

Student Company Secretary 33 April 2006

 STUDENTS SERVICES
LIST OF FIRST 25 TOP RANK HOLDERS, IN ORDER OF LIST OF FIRST 10 TOP RANK HOLDERS, IN ORDER OF
MERIT, WHO HAVE SECURED NOT LESS THAN 55% MERIT, IN THE FINAL EXAMINATION DECEMBER, 2005
MARKS IN THE AGGREGATE IN THE INTERMEDIATE
Sl. Rank Roll Regn. No. Name of the Student
EXAMINATION DECEMBER, 2005 No. No. and Centre
Sl. Rank Roll Regn. No. Name of the Student 1. 1 31681 ER0186639 NIDHI BAJAJ (MS.),
No. No. and Centre KOLKATA
1. 1 9859 ER0214570 ROHIT BIYANI, KOLKATA 2. 2 38205 NR0329104 SHAILZA MAHESHWARY
(MS.), JAIPUR
2. 2 9835 ER0214135 ADITI AGARWAL (MS.),
KOLKATA 3. 3 33686 ER0197760 RAHUL AGARWAL,
KOLKATA
3. 3 9748 ER0212951 SATISH JALAN, KOLKATA
4. 4 31683 ER0187705 PRIYA KUMARI SURANA
4. 4 24572 WR0389854 RAVIRAGHAV NARENDRA (MS.), KOLKATA
CHHAWCHHAR, AHMEDABAD
5. 4 45036 SR0202151 AJITH KUMAR N CHORADIA,
5. 5 9757 ER0213053 ADITYA JAIN, KOLKATA CHENNAI
6. 6 9834 ER0214121 KARISHMA GUPTA (MS.), 6. 5 31677 ER0184656 KOUSHIK MITRA, KOLKATA
KOLKATA
7. 6 31684 ER0188000 ALOKE SODHANI, KOLKATA
7. 7 14619 NR0422859 SARIKA (MS.), DELHI
8. 7 31659 ER0178788 ANKIT SHAH, KOLKATA
8. 8 9821 ER0213972 RAHUL GOYAL, KOLKATA
9. 8 55536 WR0335021 KALPIT ASHOK KHEMKA,
9. 9 9801 ER0213664 MANISHA JAJODIA (MS.), SURAT
KOLKATA 10. 9 31708 ER0199482 PRITI AGARWAL (MS.),
10. 10 9824 ER0214008 LOKESH CHANDAK, KOLKATA
KOLKATA 11. 10 31679 ER0184971 MINAKSHI AGARWAL (MS.),
11. 11 9901 ER0215238 ABHAY BHANIRAMKA, KOLKATA
KOLKATA
12. 12 9819 ER0213951 MOHIT JAIN, KOLKATA STUDENTS QUIZ
13. 12 9898 ER0215201 SUNIL MALL, KOLKATA
PRIZE QUERY
14. 13 27538 WR0386011 RAMANUJAM S, MUMBAI
A company manufacturing Office equipment entered into
15. 14 9822 ER0213988 SHARAD MUNDRA, two types of agreements with its customers depending upon
KOLKATA their discretion and requirements. One type related to full
service maintenance under which the entire responsibility of
16. 15 9891 ER0215121 ROHIT SHARMA, KOLKATA
maintaining the equipment supplied is with the company and
17. 16 9920 ER0215445 ASHISH GOYAL, KOLKATA the other type related to supply of spares and service
18. 17 9749 ER0212965 NAVEEN PACHISIA, maintenance under which whenever required the spare parts
were replaced. Both the agreements are for a lump sum annual
KOLKATA
payment. Sales Tax authorities treated the supply of spare parts
19. 18 9838 ER0214161 SUMIT KUMAR DHANUKA, under these agreements as sale and accordingly levied sales
KOLKATA tax. Is such a treatment valid in law?
20. 19 13644 NR0420707 ANSHUL GUPTA, DELHI CONDITIONS
21. 20 20658 SR0319648 SRILAKSHMI R (MS.),
1. Answer should not exceed one page typed in double space.
The answer sheet should contain the name, registration number
CHENNAI and address of the student.
22. 21 9836 ER0214140 KHUSHBOO AGARWAL 2. Last date for receipt of answer is 16th May, 2006.
(MS.), KOLKATA 3. Two prizes (a first and a second) in kind will be awarded to the
best answers and the names of the contributors will be published
23. 22 11404 ER0198226 VINEETA BACHHAWAT in the Bulletin.
(MS.), KOLKATA 4. The envelope should be superscribed Students Query, April 2006
24. 22 27552 WR0389504 JAY AJIT JHAVERI, MUMBAI and addressed by name to N.K. Jain, Secretary & Chief
Executive Officer, The Institute of Company Secretaries of
25. 23 9603 ER0205129 NAVIN KUMAR AGARWAL, India, ICSI House, 22, Institutional Area, Lodi Road, New
KOLKATA Delhi-110003.
26. 23 27441 WR0363332 AMIT VIJAY TATED, MUMBAI
E-MAIL ADDRESS OF THE STUDENTS
27. 24 27571 WR0391109 DEVANSHI MADHU Those students who are having e-mail address may communicate
ANKLESHWARIA (MS.), the same to the Students Services Section at dss@icsi.edu which
MUMBAI will facilitate quick and economic communication from the Institutes
28. 25 9692 ER0208251 POOJA AGARWAL (MS.), side. The e-mail address may be sent in the following format.
KOLKATA Name : _______________________________
Registration No. : _______________________________
29. 25 9808 ER0213751 SUMIT BHARTIA, KOLKATA
E-mail Address : _______________________________

Student Company Secretary 34 April 2006

 ATTENTION STUDENTS
Several queries are being received in the Institute regarding
applicability of certain Acts/Amendments relevant for the June
2006 examination. Students may note that all the course
contents given in the syllabus are applicable. However, certain
Acts which are given in the syllabus, have undergone changes/
amendments during the recent past. The Acts that have
undergone changes that are applicable for June 2006
examination as well as the changes that are not applicable for
the said examinations have been mentioned herein below for
the information of the students:
ISLRFM :
CHANGE APPLICABLE
Revised Clause 49 of Listing Agreement
ICL :
CHANGES APPLICABLE
1. Companies (First Amendment) Act, 2002.
2. Sections 2 and 6 of Companies (Second Amendment)
Act, 2002.
3. Revised Clause 49 of Listing Agreement.
4. Highlights of Concept Paper on Company Law
5. Highlights of Dr. J.J.Irani Committee Report on
Company Law
CHANGES NOT APPLICABLE
1. New e-Forms prescribed under Companies (Central
Govt.s) General Rules and Forms (Amendment) Rules,
2006
2. Companies (Amendment) Bill, 2006.
ICSP :
CHANGES APPLICABLE
1. Companies (First Amendment) Act, 2002.
2. Sections 2 and 6 of Companies (Second Amendment)
Act, 2002.
3. Revised Clause 49 of Listing Agreement.
4. Highlights of Concept Paper on Company Law
5. Highlights of Dr. J.J.Irani Committee Report on
Company Law
CHANGES NOT APPLICABLE
1. New e-Forms prescribed under Companies (Central
Govt.s) General Rules and Forms (Amendment)
Rules, 2006.
2. Companies (Amendment) Bill, 2006.
IELIL :
CHANGES APPLICABLE
1. Monopolies and Restrictive Trade Practices Act, 1969
& Competition Act, 2002. (Provisions mentioned else
where in this issue)
2. Patent Act, 1970 as amended by the Patents
(Amendment) Act, 2005 & Patents (Amendment)
Rules, 2005
3. Foreign Trade Policy 2004-09
4. Money Laundering Act, 2002
5. Copyright Act, 1957 as amended by Copyright
(Amendment) Act, 1999.
6. Foreign Exchange Management Act, 1999, Rules &
Regulations as amended upto December 31, 2005.
7. Trademarks Act, 1999 and Trade Mark Rules, 2002.
FSPELDC:
CHANGES APPLICABLE
1. Monopolies and Restrictive Trade Practices Act, 1969
Student Company Secretary
& Competition Act, 2002 (Provisions mentioned else
where in this issue)
2. Patents Act, 1970 as amended by the Patents
(Amendment) Act, 2005 and Patents (Amendment)
Rules, 2005.
3. Foreign Trade Policy 2004-09
4. Money Laundering Act, 2002
5. Copyright Act, 1957 as amended by Copyright
(Amendment) Act, 1999.
6. Foreign Exchange Management Act, 1999, Rules &
Regulations as amended upto December 31, 2005.
7. Trademarks Act, 1999 and Trade Mark Rules, 2002.
FACLP:
CHANGES APPLICABLE
1. Companies (First Amendment) Act, 2002.
2. Sections 2 and 6 of Companies (Second Amendment)
Act, 2002.
3. Revised Clause 49 of Listing Agreement
4. Highlights of Concept Paper on Company Law
5. Highlights of Dr. J.J.Irani Committee Report on
Company Law
CHANGES NOT APPLICABLE
1. New e-Forms prescribed under Companies (Central
Govt.s) General Rules and Forms (Amendment) Rules,
2006.
2. Companies (Amendment) Bill, 2006.
FSMSA:
CHANGES APPLICABLE
1. Companies (First Amendment) Act, 2002.
2. Sections 2 and 6 of Companies (Second Amendment)
Act, 2002.
3. Revised Clause 49 of Listing Agreement.
4. Highlights of Concept Paper on Company Law
5. Highlights of Dr. J.J.Irani Committee Report on
Company Law
CHANGES NOT APPLICABLE
1. New e-Forms prescribed under Companies (Central
Govt.s) General Rules and Forms (Amendment) Rules,
2006.
2. Companies (Amendment) Bill, 2006.
3. Company Secretaries (Amendment) Act, 2006
FCRLP :
CHANGES APPLICABLE
1. Companies (First Amendment) Act, 2002.
2. Sections 2 and 6 of Companies (Second Amendment)
Act, 2002.
3. Revised Clause 49 of Listing Agreement
4. Highlights of Concept Paper on Company Law
5. Highlights of Dr. J.J.Irani Committee Report on
Company Law
CHANGES NOT APPLICABLE
1. New e-Forms prescribed under Companies (Central
Govt.s) General Rules and Forms (Amendment) Rules,
2006.
2. Companies (Amendment) Bill, 2006.
NOTE: Sick Industrial Companies (Special Provisions) Act, 1985
is also applicable as the Sick Industrial Companies (Special
Provisions) Repeal Act, 2003 has not yet been notified and
hence has not become effective.
35 April 2006
 SCHEDULE OF ACADEMIC DEVELOPMENT PROGRAMMES (ADP)
Every student of the Institute who has been sponsored for 15 months training with effect from 01.07.2004 either in a company or under a Company
Secretary in Practice is compulsorily required to attend and complete 25 Hours Academic Development Programmes (ADP). The duration of each
ADP would be eight hours and those who have attended three such programmes would be deemed to have attended 25 Hours ADP. Fee
Rs. 250/- per participant per ADP.
The Schedule of ADPs proposed to be organized by Regional Councils/Chapter is as under :
Organised by Day & Date Venue of the Contact Address
Programme
EIRC of 20.05.2006 EIRO Premises Executive Officer, EIRO of the ICSI, ICSI-EIRC Bldg., 3-A, Ahiripukur 1st
the ICSI Lane, Near Beck Bagan Nursing Home, Kolkata-700019 Tel. : 22832973/
22816541 Fax No. : 033-22816542 E-mail : eiro@icsi.edu
NIRC of 15.04.2006 NIRO Premises Executive Officer, NIRC of the ICSI, ICSI-NIRC Bldg., Plot No. 4, Prasad
the ICSI Nagar Institutional Area, Rajendra Place, New Delhi-110005 Tel. : 25763090/
25767190 Fax No. : 25722662 (Code No. 011) E-mail : niro@icsi.edu/icsi@eth.net
SIRC of 29.04.2006 SIRO Premises Deputy Director, SIRC-ICSI House, No. 9, Wheat Crofts Road, Nungambakkam,
the ICSI Chennai-600034 Tel. :044-28279898/28268685 Fax No. : 044-28268685
E-mail : icsisirc@md3.vsnl.net.in/siro@icsi.edu
The schedule of other ADPs proposed to be organised by EIRC, NIRC & SIRC is as follows :
EIRC : (1) 26.08.2006 (2) 18.11.2006 NIRC : (1) 20.05.2006 (2) 15.07.2006 (3) 02.09.2006 (4) 07.10.2006 SIRC : (1) 18.11.2006

SCHEDULE OF TRAINING ORIENTATION PROGRAMMES (TOP)

Organised by Day & Date Venue of the Programme Contact Address
EIRC of 04.07.2006 EIRO Premises Executive Officer, EIRO of the ICSI, ICSI-EIRC Bldg., 3-A, Ahiripukur 1st
the ICSI to Lane, Near Beck Bagan Nursing Home, Kolkata-700019 Tel. : 22832973/
08.07.2006 22816541 Fax No. : 033-22816542 E-mail : eiro@icsi.edu
NIRC of 19.06.2006 NIRO Premises Executive Officer, NIRC of the ICSI, ICSI-NIRC Bldg., Plot No. 4, Prasad
the ICSI to Nagar Institutional Area, Rajendra Place, New Delhi-110005 Tel. : 25763090/
23.06.2006 25767190 Fax No. : 25722662 (Code No. 011) E-mail : niro@icsi.edu/
icsi@eth.net
Chandigarh 21.05.2006 To be announced Secretary, Chandigarh Chapter of NIRC of the ICSI, GGDSD College, Sector-
Chapter of NIRC to 32C, Chandigarh-160047 Tel. : 0172-2661840
of the ICSI 25.05.2006
The schedule of other TOPs proposed to be organized is as follows : EIRC : (1) 10.10.2006 to 14.10.2006 NIRC : (1) 26.09.2006 to 30.09.2006
SIRC : (1) 05.09.2006 to 09.09.2006 (2) 08.01.2007 to 12.01.2007 Bangalore Chapter : 04.09.2006 to 08.09.2006

TRAINING DIARY ATTENTION STUDENTS!

Every student sponsored for 15 months' training either in
a company or under a company secretary in practice, is
essentially required to maintain a Training Diary brought
out by the Institute.
The trainees are required to record all activities/jobs
undertaken on daily basis in the Training Diary during the
entire period of training. The Training Diary can be purchased
from the Headquarters and the Regional Offices located at
EIRC, NIRC, SIRC, WIRC and also at the Chapter Offices
at Ahmedabad, Bangalore, Chandigarh, Jaipur, Hyderabad
and Pune. The cost of a Training Diary is Rs. 100/-. The
Training Diary is being sent to students by Un-registered
and Registered post only at the following rates.
1. Unregistered Parcel = Rs. 40/- per diary
2. Registered Parcel = Rs. 55/- per diary
Students are advised to maintain the Diary as per the
Training Guidelines and submit the same to the Training
Department along with the Training Completion
Certificate.
TRAINING
It has been observed that the students opting for undergoing
15 months training with Company Secretaries in whole-time Practice
are submitting the Contract of Apprenticeship and other relevant
documents and registration fees to the Institute after a considerable
period of time.
As per the Training Guidelines, the students should submit the
underlisted documents within 15 days from the commencement of
training to enable the institute to take their training on record with
effect from the date of execution of Contract.
(i) Contract of Apprenticeship in duplicate on a non-judicial stamp
paper of requisite value as applicable to the particular State,
where the contract is executed.
The Contract should be executed by both the parties
viz., the trainee and the Company Secretary in whole-
time Practice.
(ii) Statement of Particulars to be submitted in duplicate for
registration as a trainee (Part A & B).
(iii) Rs. 50/- being the Registration Fee.
If the aforesaid documents/information is not received within
the stipulated time, the training shall not be taken on record.

Student Company Secretary 36 April 2006

LIST OF THE COMPANIES REGISTERED FOR IMPARTING 9. National Stock Exchange 15 Months Suitable
TRAINING DURING THE MONTH OF FEBRUARY, 2006 of India Ltd. Training
"Exchange Plaza", Bandra-Kurla
Sl. Region Training Stipend Complex, Bandra (East)
No. Period (Rs.) Mumbai-400051
Northern Region 10. Automobile Corporation of 15 Months Suitable
1. Goetze (India) Limited 15 Months Suitable Goa Limited, Honda, Sattari Training
A-26/3, Mohan Co-Operative Training Goa-403530
Industrial Estate, Mathura Road
New Delhi-110044 Southern Region
2. Bharat Sanchar Nigam Limited 03 Months 2000 11. Sundaram Asset 15 Months Suitable
10th Floor, Statesman House Practical Management Co. Ltd. Training
B-148, Barakhamba Road Training Sundaram Towers 46, Whites Road
New Delhi-110001 2nd Floor, Royapettah, Chennai-600014
3. Planet Retail Holdings Pvt. Ltd. 15 Months 4000 LIST OF PRACTISING MEMBERS REGISTERED FOR THE
7th Floor, Tower-A, Infinity Tower Training
PURPOSE OF IMPARTING APPRENTICESHIP TRAINING
DLF Cyber Citi, DLF Phase-II
Gurgaon-122002 DURING THE MONTH OF FEBRUARY, 2006
4. HT Media Limited 15 Months Suitable 1. SHRIKANT V. GAONKAR PCSA-1333
Hindustan Times House Training 2nd Floor, Padmavati Towers
18-20, Kasturba Gandhi Marg 18th June Road, Panaji
New Delhi-110001 GOA-403001
5. Kwality Dairy (India) Ltd. 15 Months Suitable 2. ANISH BABULAL SHAH PCSA-1334
5/1-B, Ramesh Nagar Training Sahjanand Trade Centre
New Delhi-110015 Opp. Gothawala Flats
6. Nexgen Capital Limited 15 Months Suitable Pritamnagar, Elisbridge
623 A, 6th Floor Training AHMEDABAD-380006
Devika Towers, Nehru Place
New Delhi-110019 3. V.S. TAPADIA PCSA-1335
7-J-11, R C Vyas Colony
7. Evinix Accessories Limited 15 Months Suitable
BHILWARA-311001
KH-43, Sector-45 Training
(RAJASTHAN)
Mewla Maharajpur
Faridabad-121003 CHANGE IN NAME OF THE COMPANY REGISTERED FOR
Western Region IMPARTING BOTH 15 AND 03 MONTHS PRACTICAL
8. Jhagadia Copper Limited 15 Months 3000- TRAINING
747, G.I.D.C. Industrial Estate Training 3500
Post Box No. 14 From : ASIL Industries Limited
Jhagadia-393110 To : Anil Special Steel Industries Limited
Distt. Bharuch, Gujarat Kanakpura, P.O. Meenawala, Jaipur-302012

STATUS OF TRAINING
(Period from 01-03-2006 to 31-03-2006)
15 Months Training with Company/Company Secretary in Practice and 03 Months & 15 days Practical Training
STAGE-I STAGE-II
Biodata of the students sent to the companies/company Students sponsored for training
secretaries in practice for consideration
APPLICATIONS CASES
Pending Received Forwarded for Pending Pending Received No. of students Pending
Training as on during the consideration as on as on during who have been actually as on
Type 28.02.06 month (upto 31.03.06) 31.03.06 28.02.06 the month taken for training 31.03.06
(upto 31.03.06)
15 Months in 10 47 47 NIL 10 31 35 06
Companies
15 Months with NIL 07 07 NIL NIL 36 28 08
CS in Practice
3 Months in NIL 55 55 NIL
Company/
15 Days in
Optional Area
2. Exemption
1. Number of applications pending as on 28.02.2006 : NIL
2. Number of applications received for exemption : 39
3. Number of exemptions granted : 39
4. Number of pending applications as on 31.03.2006 : NIL

Student Company Secretary 37 April 2006

 NEWS AND ANNOUNCEMENTS
Chapter building project and made an earnest appeal to other
NEWS AND ANNOUNCEMENTS members for financial help for completion of the remaining
construction work of the dream project of the Chapter. He also
CS PROGRAMME ON ALL INDIA RADIO reiterated the future plans of the Chapter and new facilities proposed
to be provided to the members and students of the Chapter in the
On 18.3.2006 a 20 minutes interview with H.M. Choraria, new premises.
President, the ICSI on Career as a Company Secretary was
H.M. Choraria, while speaking on the occasion lauded the Chapter
broadcast on Yuvavani (Delhi D) during Sunehara Kal on All
for completing the construction of the major portion of the building
India Radio at 7.45 P.M. The informative programme
just within a year. He said that this is a landmark achievement in the
highlighted the CS examinations, cut off dates, career
history of the Institute as well as of the Chapter. He also highlighted
prospects and role of company secretary professionals.
the various steps and initiative taken by the Institute for the growth
and development of the profession.
EASTERN INDIA REGIONAL COUNCIL N.K. Jain, in his address thanked the Govt. of Orissa for allotting
BHUBANESWAR CHAPTER a piece of land for the Chapter building, B.J. Panda, local MP (Rajya
CAREER AWARENESS PROGRAMME Sabha) for his generous contribution of Rs. 2.5 lakhs from his MPLAD
Fund, NALCO & OMC for their financial support of Rs. 2.5 lakhs and
On 17.02.2006, the Chapter organized a Career Awareness Rs. 1 lakh respectively for the Chapter building project.
Programme on CS course during the Annual Function of the
Department of Commerce, Banki (Autonomous) College, Dist: He lauded the contribution of J.B. Das, immediate past Chairman
Cuttack. S.K. Pattnaik, Principal, S.N. Padhi, Head of the Department in getting the land sanctioned from the state Government. He
of Commerce along with other faculty members and more than 100 congratulated K.N. Ravindra, and his team for their sincere efforts,
students of the college attended the programme. commitment and dedication for the dream project and said that it
was a memorable event in the history of the Chapter to get its own
S.S. Sonthalia, Vice Chairman of the Chapter spoke on the building and the long cherished dream is fulfilled.
occasion. In his address to the students, he advised them to start
their professional career right from the 10 + 2 level. He advised the Subrata Kumar Ray, Vice Chairman, EIRO said that it was the
students to take advantage of the CS course for a respectable and best Chapter building ever seen by him. He also congratulated the
dignified placement in a corporate sector as well as an independent team of Bhubaneswar Chapter for successful completion of the dream
practitioner. He explained the job of a practising company Secretary project.
and the income prospects of the practising members after completing NEW OFFICE ADDRESS OF BHUBANESWAR
the course. He also highlighted the scope and areas of service where CHAPTER
a practising company secretary can serve the trade, industry and the
society. He informed that the new office building of the Chapter has W.e.f. 1.4.2006 the office of the Bhubaneswar Chapter of EIRC of
become operational and where the students will have better the ICSI has been shifted to its own building. The new address,
infrastructural facilities. He invited all the students and the college telephone number and e-mail ID of the Chapter Office are as under :
authorities to visit the newly constructed Chapter office building. Bhubaneswar Chapter of EIRC of the ICSI
A 15 minutes multimedia presentation on CS course was shown Plot No. 70, VIP Colony,
during the seminar through LCD projector. Institutes published IRC Village,
pamphlets on CS Foundation & Intermediate Course, Role of Bhubaneswar - 751 015.
Company Secretary and FAQs on Company Secretaries Course were Telephone No. (Code No. 0674): 2552282
distributed among the participating students and faculty members of Email: bhubaneswar@icsi.edu and icsibbsr@icsi.edu
the college. U.C. Mishra, Chapter Official arranged and co-coordinated
the programme. NORTHERN INDIA REGIONAL COUNCIL
INAUGURATION OF NEWLY CONSTRUCTED SCHEDULE OF ORAL COACHING CLASSES FOR
CHAPTER OFFICE BUILDING DECEMBER 2006 EXAMINATION
On 12.3.2006 the newly constructed Chapter Office building at COURSE TIMINGS FEES No.of
Plot No. 70, VIP Colony, Nayapally, Bhubaneswar was inaugurated (Rs) Lectures
by H.M. Choraria, President, the ICSI in the presence of N.K. Jain,
Secretary & CEO of the ICSI, Subrata Kumar Ray, Vice Chairman of FOUNDATION 07.30 A M 12.00 NOON 3,500 150
EIRC of the ICSI, K.N. Ravindra, Chairman, S.S. Sonthalia, Vice INTERMEDIATE 07.30 A M 12.00 NOON 4,000 135
Chairman, S.K. Ray, Secretary, P.K. Biswal, Treasurer & D.M. Rao, GROUPI &
D. Mishra, J.B. Das, Members of the Managing Committee of the 10.00 A M 02 .30 P M 4,000 135
Chapter, members & students of the Chapter, and a host of invited &
guests and other dignitaries in a glittering function. Since this was 02.30 P M 07.00 P M 4,000 135
the first visit of H.M. Choraria to the Chapter office after assuming
INTERMEDIATE 07.30 A M 12.00 NOON 3,500 125
the office of President of the ICSI, he was felicitated by K.N. Ravindra
GROUPII &
before inauguration of the building. A function was organized at the
10.00 A M 02.30 P M 3,500 125
same venue to mark the occasion.
In his welcome address, K.N. Ravindra, Chapter Chairman FINAL 07.30 A M 12.00 NOON 4,000 90
cherished the past memories and difficulties the Chapter faced in GROUPI Mon/ Wed/ Fri
undertaking the building project. He thanked the HO of the ICSI, past FINAL 07.30 A M 12.00 NOON 4,500 110
Chairmen and office bearers of the Managing Committee, Members, GROUPIII Tue/ Thu/ Sat
Students and the employees of Bhubaneswar Chapter for their
Each lecture is of two hours duration.
valuable contribution and support for completion of the construction
DATE OF COMMENCEMENT OF CLASSES 3rd MAY, 2006
of the ground and first floor of the Chapter building. He read out the
Interested students are advised to deposit the fees by cash/
names of the individual donors who contributed generously for the
demand draft favouring NIRC of the ICSI payable at New Delhi

Student Company Secretary 38 April 2006

 NEWS AND ANNOUNCEMENTS
at NIRC office, ICSI-NIRC Building, 4, Prasad Nagar Institutional
Area, New Delhi 110 005. The students undergoing Oral SOUTHERN INDIA REGIONAL COUNCIL
Coaching Classes who qualify the required Eligibility test need ORAL COACHING CLASSES FOR FOUNDATION/
not submit the Response Sheets under Postal Tuition Scheme. FINAL LEVELS OF CS COURSE FOR DECEMBER
For further details please contact the NIRC-ICSI at 4, Prasad 2006 EXAMINATIONS
Nagar Institutional Area or call on phone No: 25769352,
25763090, 25767190, Fax: 25722662. Email niro@icsi.edu, SIRC of the ICSI proposes to conduct Oral Coaching Classes
icsi@eth.net. for Foundation and Final (Gr.I & Gr.III) of the CS course as per
details given below :
ICSI-Mother Teresa Institute of Management and Vocational
Studies Oral Tuition Centre Stage Date of Timings Fees Last Date for
ORAL COACHING CLASSES FOR FOUNDATION Comme- receipt of
AND INTERMEDIATE GROUP I & II* FOR ncement application
DECEMBER 2006 SESSION OF EXAMINATION Foundation 10.7.2006 9.00 A.M. to Rs.3000/- 03.7.2006
Oral Coaching Classes for Foundation and Intermediate (Morning) 11.00 A.M
Group I & II* are likely to commence from 01.5.2006 and Foundation 10.7.2006 4.00 P.M. to Rs.3000/- 03.7.2006
23.5.2006 respectively. (Evening) 6.00 P.M
Course Fee : Rs.3500/-(Foundation/ Intermediate per Group) Final Group I 03.7.2006 6.00 P.M. to Rs.3,200/- 27.6.2006
Timings : 5.00 to 7.00 P.M. (Monday to Saturday) (Evening) 8.00 P.M
Registration open on all working days between 9.30 A.M. and 6 P.M. Final 03.7.2006 6.00 P.M. to Rs.3,200/- 27.6.2006
Registration for admission is in full swing. Admission is Group III 8.00 P.M per group
on first come first served basis. (Evening)
For further details contact For further details contact :
J.K. Chawla/Vinay Gupta SIRO of the ICSI,
Mother Teresa Institute of Management & Vocational Studies New No.9,Wheat Crofts Road, Nungambakkam,
C Block, Preeti Vihar, Delhi 110092 Chennai 600 034.
Phones: 22057200, 22057500,22501900, 22527200 Phone : (044) 28279898; 28268685.
Fax: 22509200 Email : mtim@vsnl.net E-Mail : siro@icsi.edu; icsisirc@md3.vsnl.net.in
(* Provided sufficient number of students are registered for Group II) CAREER AWARENESS PROGRAMME
JAIPUR CHAPTER On 22.2.2006 Department of Corporate Secretaryship of Shree
INAUGURATION OF SMTP Chandraprabhu Jain College organized a guest lecture on the Need
of Professional Qualification in the recent scenario at Minjur, Chennai.
On 5.3.2006 H.M. Choraria, President, the ICSI inaugurated the Sarah Arokiaswamy, Deputy Director, SIRO addressed the students
SMTP conducted by the Chapter. Gagan Mittal,Chapter Chairman in on the topic. Around 120 students participated in the programme.
his welcome address informed about the activities of the Chapter
and the future plans. Students from outside Jaipur also attended the While addressing the students, Sarah Arokiaswamy narrated the
SMTP. importance of studying professional course in the present corporate
scenario and added that studying degree course will not suffice to
KANPUR CHAPTER meet the requirements of the employer since the entire gamut of
CAREER AWARENESS PROGRAMME corporate management is getting professionalized. She advised the
On 22.02.2006 the Chapter organised a Career Awareness students to take up professional course like company secretaryship
Programme on the profession of Company Secretaries at Mahila which ensures a good career, employment opportunities and social
Degree College, Kidwai Nagar, Kanpur. Arvind Kumar Bhargava, status. She explained the course, fee structure, admission procedure
Chairman, S.K. Gupta, Regional Council Member of NIRC along with and various services offered by the Southern India Regional Office.
office staff of Kanpur Chapter visited the college. Arvind Kumar The queries raised by the students were suitably replied by the
Bhargava, briefed the students about the Head Quarters, Regional Deputy Director. Pamphlets explaining CS course were also
Councils and the Chapters spread in all over India and the syllabus distributed among the students.
of the course. He also explained the students that the Chapter provides
instant registration facilities, organises oral coaching classes and it STUDENTS MEETING WITH PRESIDENT, THE ICSI
has well equipped Library, reading and class rooms also. It also On 10.03.2006 the Regional Council organized a meeting of the
provides ICSI publications and study materials etc. students with H.M.Choraria, President, Preeti Malhotra, Vice President
Addressing the students S.K.Gupta, explained about the scope and N.K.Jain, Secretary and CEO. The ICSI , New Delhi wherein
of the profession. He informed them about the position, functions Dattatraya joshi, Chairman and C.Sudhir Babu, Member, SIRC and
and responsibilities of a Company Secretary in employment and in Chairman, Oral Coaching and Students Facilities Committee were
Practice. He also discussed various opportunities available to the also present. President informed the students about the decision of
Company Secretaries in employment as well as in practice. the Council of the Institute in making certain changes in the existing
Divya Saxena, Company Secretary in Practice, and Leena Jain, syllabus of the company Secretaryship course. Preeti Malhotra
Company Secretary, Ganesh Polytex Ltd. said that Kanpur Chapter advised the students on how to prepare for the Company
of ICSI is one of the best Chapters of India. The profession of company Secretaryship examinations and also explained the increased career
secretaries is good for employment as well as self employment. opportunities for Company Secretaries.
The students showed keen interest and raised various queries. BANGALORE CHAPTER
The students were advised to contact Kunwar Lal Kushwaha at the
Chapter Office for any further clarification. Pamphlets explaining the CAREER COUNSELLING PROGRAMMES
CS course were also distributed among the students. Around 250 On 30.1.2006 the Chapter conducted a career Counselling
students were present at the career awareness programme. programme at Acharya Pathashala College, Bangalore. Over 200

Student Company Secretary 39 April 2006

 NEWS AND ANNOUNCEMENTS
students of First and Second year B.Com and BBM attended the
programme.
Again on 31.1.2006 the career counseling programme was held
at Acharya Pathashala College, Bangalore. Over 150 students from
third year B.Com and BBM attended the programme.
The speakers were one or the other of the following: P.K. Pande,
Member, Bangalore Chapter of the ICSI, G.V. Srinivasa Murthy,
Chapter Secretary, Sangeetha Flora, Executive Officer of the Chapter
Office, Dwarakanath C, Chapter Treasurer. The speakers explained
in detail the course offered by the Institute its eligibility criteria,
examination, requirements of training etc. They also highlighted the
importance of making the right career choice so as to be successful
in life.
The speakers also spoke about the role of a Company Secretary
and importance of the profession of Company Secretaries in the
changing economic scenario. They also highlighted the opportunities
available to anyone who has completed the Company Secretaryship
course. They further enumerated the emerging areas of practice and
the changing role of a Company Secretary. They also focused on
what would be the mindset and preparation required from a student
who wanted to pursue the Company Secretaryship Course. Brochures
containing brief details of the Company Secretaryship Course were
distributed to the participants.
The speakers also clarified the doubts and issues raised by the
participants and thanked the management for providing the Institute
this opportunity.
SECOND STATE LEVEL STUDENTS CONFERENCE
MILAAP 2006
ON 11 and 12.2.2006 Milaap 2006, the Second State Level
Students Conference was organised by the Chapter at the Institution
of Agriculture Technologies, Bangalore. Over 175 CS students from
Bangalore, Mysore, Mangalore, Hubli-Dharwad and even from Kerala
attended the Conference.
Inaugural Session : Chief Guest Woody P. Krishna, Hon. Secretary,
Seshadripuram Group of Institutions, Bangalore. inaugurated the
Conference. Krishna in his address commended the Institute in taking
concerted efforts in keeping pace with the changing economic
scenario. He then highlighted the importance of having high ethical
standards, being honest, having dignity, quality & independence as
professionals in order to justify the trust and confidence entrusted by
the society and Government. He also emphasised the importance of
upholding and integrating traditional values with modern work
methods, developing good thinking as knowledge has value only in
hands of someone who has the ability to think well; having the right
mind-set and above all integrity, because the method you use to reach
your goal is as important as the goal you are trying to reach. He
concluded by wishing the Conference all success and a hope that
the conference will help the participants in actualizing their potential.
First Technical Session Presentation on Corporate Laws : The
following students Pavitra & Harish; Shrinivas & Chakri; Rashmi &
Raghuveera; Pracheta & Madhwesh from Mysore gave presentation
on topics Securities Market and its Regulations; LLP-an Alternative
Corporate Business Vehicle; Foreign Institutional Investors; and
Revised Clause 49. In their meticulous and vibrant presentations
the students covered the history; evolution; basic concepts/ definitions;
various statutory provisions; latest amendments / trends; and the
issues involved therein. There were lively interactions during each of
the presentations by the participants. As a team the students from
Mysore also gave a presentation of India, which touched the heart of
everyone present and made each one of us proud that we belong to
such a culturally rich country.
Next the written (Preliminary) round for the business quiz, was
conducted.
The Second Technical Session was on How to Crack Professional
Student Company Secretary
Exams. C.V. Madhusudhanan, Partner, S. Srinivasan & Co., Company
Secretaries, Bangalore, addressed the students on this topic,
highlighting the need for a positive mindset, adequate rest, proper
diet and good preparation beforehand. He also shared some valuable
tips on how to actually write the examination and Dos and Donts of
pre, during and post examination.
Richab Chand, Member of the Institute also shared his experience
when preparing for the CS Exam and tips on how to be successful in
the CS Exam.
The next session was on Know the Institute wherein Sangeetha
Flora, Executive Officer of the Chapter Office gave a presentation
covering a brief overview on the ICSI, its activities, the facilities/
resources being offered/ made available to students and the various
programmes organised for the students both by the Head office and
the Chapter.
Bhagavathy, Student enlightened the Students on the various
activities of the students forum in Bangalore.
The last session of the day was the Anthakshari competition,
wherein a prelims was first held and 5 teams then competed in the
final round.
The second day commenced with the students staging a Mock
Board Meeting including a video conferencing which was highly
appreciated by all present. B.S. Iyer, Legal Counsel and Company
Secretary, MICO, Bangalore, gave his comments on the Mock Meeting
and also shared his views and tips on how to prepare for and also
hold Board Meetings.
The next session was on Tips on Facing Interview, with a
presentation made by Sriram, Proac Resources, Bangalore who
covered areas such as Personal Presentation, Attitude,
Communication; the dos and donts in an interview; the list of possible
questions and how to answer them; and how to write a good and
effective resume.
This was followed by Mock Interview of 3 students which was
conducted G.K. Surekha, Vice President (Legal) & Company
Secretary, Mysore Cements Limited, Bangalore and Sriram, Proac
Resources, Bangalore.
The students then entertained the gathering with a Light Music
Concert.
Valedictory Session : The speakers were Chenraj Jain, Chairman,
Jain Group Institutions, Bangalore and the Guest of Honour, V.
Sreedharan, Central Council Member, The ICSI. Chenraj Jain in his
inspiring and thought provoking address which was interspersed with
numerous anecdotes and real life examples emphasised on the need
for each person to understand that the Human Mind was unique and
those who capitalized on the same were the winners. He highlighted
the need to be go-getters, doers, outside the box thinkers in order to
be successful in any endeavor. He also encouraged the students to
be entrepreneurs instead of looking for jobs, and also to focus on
developing themselves and those around them. He concluded with
the words of that if the mind can think it, then nothing is impossible.
V. Sreedharan in his address encouraged the students to take
active part in the various programmes organised by the Institute both
at the National and Chapter Level. He then informed the students on
the various students related initiatives being taken by the Institute
inter alia the syllabus review and enhancing the quality of training
being imparted.
Chenraj Jain then distributed prizes to the winners of the Business
quiz and Anthakshari competitions.
ICSI PRESIDENTS MEET WITH THE STUDENTS
On 18.03.2006 the Chapter organised a students meeting with
H.M. Choraria, President, The ICSI, and Dattatraya Joshi, Chairman,
SIRC of the ICSI at the Atria Hotel, Bangalore. The President in his
address briefed the students on the initiatives taken by the Institute
40 April 2006
 NEWS AND ANNOUNCEMENTS
for them like the syllabus review, strengthening of training, enhancing
visibility of the Profession, Study Material on CD and requested them
to give their views and suggestions regarding the same.
He also stressed on the importance of developing soft skills,
communication, presentation, interpersonal skills etc and also being
IT savvy. He concluded by stating "Think Big! Set your eyes on the
top! as there is always place at the top."
Dattatraya Joshi also addressed the students and shared tips on
how to pass the CS examination and concluded by stating that hard
work is the key as there is no other shortcut to success.
During the Interaction the students gave the following suggestions:
as students are usually not able to decide whether to take up
employment or practice, training should be made compulsory both at
corporate and with a Practising Company Secretary. They felt that
the present system of training only after completion of Intermediate
is fine. The Taxation paper for final needs a little toning down as it is
at present very demanding. There could be a system of certain
compulsory and certain optional papers in final which could lead to
specialization instead of 9 compulsory papers. A system should be
introduced by the Institute, to send acknowledgement of the Quarterly
reports sent by trainees (this could even be by email only), as at
present trainees do not know if the Institute has received their reports
or not till they apply for membership. In the paper MIS & CC
(Intermediate) the MIS portion is too technical. It needs to be made
more understandable and less technical with more relevant examples.
That exams could be conducted during weekends. That the oral
coaching classes conducted by the Chapter should be for a period of
6 months for it to be more effective and thereby attracting more
students to register for the same. That a gap of at least one day be
given between groups of both Intermediate and Final Exams of the
Institute.
FIFTH TRAINING ORIENTATION PROGRAMME (TOP)
On 6.03.2006 the 5th Training Orientation Programme conducted
by the Chapter was inaugurated by Chief Guest Ramesh T.
Krishnamurthy, Manager HRD, Integra Micro Systems (P) Ltd.,
Bangalore, In his address Ramesh highlighted the importance of
orientation and how it prepares one to acquire what one requires for
performance. He also dwelt upon Governance and why it was
important to look beyond the obvious and try to sense the motive
behind each action / situation. Self Governance before Corporate
Governance is a must he added. He also enumerated the attributes
required for the same as : upholding value systems that will not only
make you proud but your mother and children as well; continuous
learning; having an open mind; approaching your work with passion;
having presence of mind, quick wit and a sense of humour;
accessibility and applying common sense, apart from developing
interpersonal skills with regard to relationship building and
communication.
The Valedictory session of TOP was held on 10.03.2006 at the
Chapter premises. V. Sreedharan, Central Council Member, The ICSI
was the Chief Guest who in his address impressed upon the
participants the importance of developing a bond with the Institute
and requested them to contribute in areas they are good at. He also
enumerated the various initiatives being taken by the Institute
especially with regard to strengthening the training aspects of the CS
Course. He emphasised on the necessity for developing
communication skills, being internet and tech savvy and developing
the habit of reading. He concluded with a word of advice to the students
on making the effort to choose ones place of training carefully so as
to learn the most during the same. Sreedharan then distributed the
Course Completion Certificates to the participants.
29 TH SECRETARIAL MODULAR TRAINING
PROGRAMME
On 13.03.2006 the 29th SMTP conducted by the Chapter was
Student Company Secretary
inaugurated by the Chief Guest Paresh Vora, General Manager,
heading Dover Software India, Bangalore . In his address Vora touched
upon the fact that the emerging areas in the role of Company
Secretaries provide a scope for wider areas of specialization which in
turn provides more opportunities both for work and learning thereby
increasing the responsibilities being shouldered by Company
Secretaries.
He also stated that ones education never gets completed on the
attainment of a degree and that it is an ongoing process.
J. Sundharesan, Immediate Past Chairman of the Chapter also
addressed the participants and impressed upon them the need to
stay focused and also having a clear goal in mind as far as their
career were concerned.
At the valedictory session of the SMTP held on 29.3.2006 at the
Chapter premises Chief Guest V.C. Davey, Registrar of Companies,
Karnataka, Bangalore commenced his address by congratulating the
participants on completion of the CS Course. He emphasised on the
necessity of the members in being tech savvy, as the MCA has entered
a transparent and computer era. He also highlighted on the importance
of reading especially professional journals and also regularly visiting
the websites of ICSI and MCA to update ones knowledge.
He also directed the attention of the participants to the fact that
the prosecution aspects under the new MCA 21 dispensation were
stringent and thereby increasing the responsibility and professional
liability of professionals and shared certain tips on how professional
could safeguard themselves in this regard. He concluded by wishing
the participants a very bright future.
Anand and Deepak Kumar Jain, participants also shared their
views on the SMTP.
Davey then distributed the Best Participant Certificate Award to
Deepak Kumar Jain, and prizes for the Best Project to the team of
Sunu Manuel and Jose Thomas. He also distributed the Course
Completion Certificates to the participants.
HYDERABAD CHAPTER
QUIZ PROGRAMME
On 5.3.2006 the Chapter organized a Quiz Programme for the
Oral coaching students of 57th Batch of Intermediate at the Chapter
premises. Datla Hanumanta Raju, Council Member, the ICSI
inaugurated the Quiz Programme and blessed the students. KK
Rao, Chairman - Oral Coaching & Students Facilities Committee
informed the students the main objectives for conducting the Quiz.
The Quiz Programme was on various provisions of the Companies
Act, Accountancy, Costing, Taxation, Economic, Labour,
Industrial, Commercial, General and Securities Laws. Nearly 16
teams participated in the programme. KK Rao acted as Quiz
Master.VS Raju, In-charge, Oral Coaching was the Scorer. The
winners of the quiz were. Varun Deshmukh and Sneha while the
runners up were Chanakya Chandra Reddy and V.S.L. Prasanna.
NINTH TRAINING ORIENTATION PROGRAMME
(TOP)
From 7.3.2006 to 13.3.2006 the Chapter conducted its 9th Training
Orientation Programme. Datla Hanumanta Raju, Council Member,
the ICSI enlightened the students with his valuable suggestions. CV
Subba Rao, Chief General Manager (Finance), Andhra Pradesh
Industrial Infrastructure Corporation Ltd was the Chief Guest who
inaugurated the programme. In his address he explained about the
importance of infrastructure in the Company Secretary domain,
develop the communication skills, habit of reading news papers. VS
Raju, Programme Co-ordinator, coordinated the programme.
On 13.3.2006 at the valedictory session of the TOP V.Ahalada
Rao, Chairman of the Chapter presided over the function and
welcomed the dignitaries and gave the report on Training Orientation
Programme and wished the participants for successful completion of
41 April 2006
 NEWS AND ANNOUNCEMENTS
the programme. Dr. PVS Jagan Mohan Rao, Former President, The
ICSI in his address shared his ideas, thoughts about happy and not
so happy moments. Datla Hanumanta Raju, Council Member, the
ICSI explained about the hard work to synthesise and work in
coordination with the concepts. C.Sudhir Babu, Former Chairman,
The ICSI-SIRC advised the students to improve soft skills and
highlighted the significance of training. AS Durga Prasad, Council
Member, The ICWAI explained about knowledge Management, how
to prove that they are better always, importance of communication,
self expression and how to be independent in thinking and also
suggested that every one should have new ideas for better
improvement.
Participation certificates were presented to the trainees. The Best
Participant Award was presented to Pracheetha.
ICSI PRESIDENTS MEET WITH THE STUDENTS
On 9.3.2006 the Chapter organised a Presidents Meet with
Students at its premises. KK Rao, Chairman-Oral Coaching &
Students Facilities Committee gave Oral Coaching activities report.
Dattatraya Joshi, Chairman-The ICSI- SIRC in his address
congratulated the students for choosing the Company Secretaryship
Course, about the opportunities available, tips for completing the
course. NK Jain, Secretary & CEO, the ICSI in his address spoke on
budget highlights, Company Secretaries adding value to the business,
registration of students on line, creating e-groups, download the forms
etc., Preeti Malhotra, Vice President, the ICSI addressed the students
and insisted about the hard work, commitment, dedication, sincerity
and also stressed on the e-learning process, short term courses. HM
Choraria, President, The ICSI in his address quoted the changing
amendments in Listing Agreement & Company Law, opportunities
for Students, how to face the challenges, new avenues for Company
Secretaries and also informed about revision of Syllabus, 72 hours
Computer training. President asked for the feed back & suggestions.
President, Vice President & Secretary distributed the Certificates to
the meritorious students.
ICSI PRESIDENTS MEET WITH PRINCIPALS OF
COLLABORATIVE CENTRES
On 9.3.2006 the Chapter organised an Interactive Meeting with
Principals & Co-Coordinators of Collaborative Centres at its premises.
They discussed the students registrations, Career Awareness
Programmes. President, Vice President & the Secretary & CEO of
the Institute advised the principals to motivate the students to join
the Company Secretaryship Course and at the same time stressed
on the importance of the Company Secretary in Corporate field.
Principals participated gave suggestions for implementation.
TWENTY-NINTH SECRETARIAL MODULAR TRAINING
PROGRAMME (SMTP)
On 13.3.2006 the 29 th Secretarial Modular Training
Programme(SMTP) conducted by the Chapter was inaugurated at
the Chapter premises. V.Ahalada Rao, welcomed the participants
and dignitaries to the dais and emphasised the need of the SMTP
conducted by the Institute.Datla Hanumanta Raju, Council Member,
the ICSI said that SMTP is the tool to bridge the gap between theory
and practice. P.S.Raman, Executive Chairman, Ram Informatics Ltd.,
Hyderabad was the Chief Guest who inaugurated the Training
Programme. He congratulated the participants for successful
completion of Final course. He highlighted the role & importance of
Company Secretary as a significant one and described the Company
Secretary a strategic advisor, financial advisor, Managerial advisor on
the whole. Raman advised the students to explore their inner qualities
& resources available. He emphasised the need to grow with their
potential and to take risk in their field for higher return and he shared
his personal experiences by quoting that every year in every field, it
Student Company Secretary
was a learning experience, and also emphasised the need to cultivate
the interest in whatever way one leads his or her life.
On 29.3.2006 at the valedictory session of the SMTP V.Ahalada
Rao, Chairman of the Chapter presided over the function and
emphasised the need and purpose of the SMTP and visits to Stock
Exchange and Registrars. Datla Hanumanta Raju, Council Member,
The ICSI highlighted the huge demand for the Company Secretaries
in todays world and emphasised the need for continuous updating
and learning. C.Sudhir Babu, Former Chairman, SIRC advised the
participants to contribute and serve the Institute in their own way.
C.Bala Gopal, Chief Executive Officer, Hitvel in his address
highlighting the need for knowledge, amendments updation for any
professional to succeed. He emphasised that Company Secretary
plays a dominant role in the corporate field, importance of Company
Secretaries and also congratulated the participants for their success
and in all their future endevours. Mementoes were presented to
S.Krishnamoorthy, SP Hima Bindu and KSN Murthy for winning Good
Speaker, Better Speaker and the Best Speaker respectively.
Awards were also presented to the team comprising
S.Krishnamoorthy, KSN Murthy and D.Madhavi Latha for preparing
& presenting the Best Project on Employee Satisfaction and
Motivation during one of the SMTP sessions.
S.Krishnamoorthy was awarded the Best Participant award as
adjudged by the SMTP participants. The dignitaries presented
certificates of participation. KK Rao, Chapter Treasurer quoted the
words that Learning has no end at the conclusion of the programme.
SEMINAR ON HOW TO PREPARE & WRITE THE
PROFESSIONAL EXAMINATION
On 19.3.2006 the Chapter organised a Seminar on How to Prepare
& Write the Professional Examination at its premises. The guest
speakers were PS Rao and Rajnish C. Popat, Company Secretary.
The programme received overwhelming response and was greatly
appreciated by the Students. Nearly 75 Students attended the Seminar.
FAREWELL FUNCTION
On 19.3.2006 the Chapter organised a farewell function at its
premises. V.Ahalada Rao, Chapter Chairman presided over the
Function and in his address explained about the structure of
examination, plan for writing the examination and also suggested to
learn from others experiences to come up with flying colours in the
examinations. Dr. PVS Jagan Mohan Rao, former President, The
ICSI in his address insisted on hard work, to avail opportunity, good
communication, importance of maintaining good health, learn the art
of concentration and also suggested the students to diffuse from
tensions. Madhavi Latha, SMTP student gave tips for writing the
professional examination.
MADURAI CHAPTER
CAREER AWARENESS PROGRAMMES
On 30.01.2006 the chapter conducted career awareness programme
at Yadhavea College for Arts and Science (Women), Madurai for B.Com
1 & III year, BBA I & III year students. V.S.Krishnamurthy Vice-Chairman,
and T.Raja of the Madurai Chapter of ICSI were the speakers.
Again on 07.03.2006 the Career Awareness Programme was held
at Karumathur Shri Arul Anandhar College, for B.Com 1 & III year,
BBA I & III year students V.S. Krishnamurthy Vice-Chairman, and
T.Raja of the Chapter were the speakers. In both the institutions the
speakers explained about the Institute, Course Structure of foundation
and intermediate, Course fees, subjects, admissions procedures,
examination details etc. They also explained about the avenues
available to the profession both in employment and in practice.
Pamphlets of the foundation and intermediate course were distributed
among the students, Institutes CD were screened through LCD
presentation.
42 April 2006
 NEWS AND ANNOUNCEMENTS
MANGALORE CHAPTER
ORAL COACHING CLASSES FOR DECEMBER 2006
EXAMINATIONS
The Chapter proposes to conduct the oral coaching classes for
December 2006 examinations for foundation/intermediate/final level
students of the institute. The classes will be held subject to enrolment
of sufficient number of students. For further details contact the
Chapter office at Grace Towers, II floor, Bejai, Mangalore-4 between
11 AM and 8 PM on all working days.

WESTERN INDIA REGIONAL COUNCIL

INDORE CHAPTER
PROGRAMME ON CENTRAL EXCISE LAW
On 12.02.2006, the Chapter organized a course-oriented
programme for the students on Central Excise Law (with special
emphasis on CENVAT / Registration of new Units etc.) at the Chapter
Premises. Rajul Mehata, Chief Excise Executive, Sonic Biochem
Extractions Limited, Indore was the Guest faculty who highlighted
various provisions of Central Excise Law and shared his practical
experience with the students. In the question answer round, he
very well replied the queries raised by the students.
THANE CHAPTER
ORAL COACHING CLASSES FOR INTERMEDIATE
(GROUP II) STUDENTS
W.e.f. 3.7.2006 the Chapter proposes to commence the next
batch of Oral Coaching Classes for Intermediate (Group II) students.
For further details contact the Chapter Office at 206, Swastik Plaza,
2nd Pohkran Road (Subash Nagar) Prior to Voltas Ltd., Thane
(W) 400601. Phone : 25444479. E-mail : rrajguroo@yahoo.co.in

OPPORTUNITY
T o SStart
tart Car eer in
Career
Company Law
with a Fast & Progressive Chartered Accountants Firm involved in Company
Law work from incorporation to mergers and demergers for
CS Students
Apply Immediately with Complete Bio-data for the post of

CORPORATE ASSISTANTS
to
Box No. 130
C/o Student Company Secretary
The Institute of Company Secretaries of India
22, Institutional Area, Lodi Road
New Delhi-110003

Student Company Secretary 43 April 2006