PPT: Companies Incorporated Outside India | Corporate & Other Laws for CA Intermediate PDF Download

 Page 1


CHAPTER-XXII
SECTION 407: Definitions
COMPANIES INCORPORATED 
OUTSIDE INDIA
Page 2


CHAPTER-XXII
SECTION 407: Definitions
COMPANIES INCORPORATED 
OUTSIDE INDIA
Section 379: Application of Act to Foreign Companies
Section 591
Companies Act, 1956 
Section 379
Companies Act, 2013
This section was applicable in two 
scenarios:
1. Foreign companies having  a place 
of business in India
2. Foreign companies having business 
in India meeting control parameters  
This section  now does not apply to 
companies who merely have a place 
of business in India unless they have 
business in India and meet the 
control parameters
**Introduction of this section will bring transparency and also prohibits the 
foreign companies to take any benefit from non-compliance of any provisions 
of the Act.
**This section clarifies lot of doubts and applicability of various provisions to 
foreign companies
Page 3


CHAPTER-XXII
SECTION 407: Definitions
COMPANIES INCORPORATED 
OUTSIDE INDIA
Section 379: Application of Act to Foreign Companies
Section 591
Companies Act, 1956 
Section 379
Companies Act, 2013
This section was applicable in two 
scenarios:
1. Foreign companies having  a place 
of business in India
2. Foreign companies having business 
in India meeting control parameters  
This section  now does not apply to 
companies who merely have a place 
of business in India unless they have 
business in India and meet the 
control parameters
**Introduction of this section will bring transparency and also prohibits the 
foreign companies to take any benefit from non-compliance of any provisions 
of the Act.
**This section clarifies lot of doubts and applicability of various provisions to 
foreign companies
Section 379: Application of Act to Foreign Companies
Where not less than 50% of the paid-up share capital, whether equity or preference or
partly equity and partly preference, of a foreign company is held by :
One or more citizens of India 
One or more companies or bodies 
corporate incorporated in India
singly or in aggregate
Such company shall comply with the provisions of this chapter and such other
provisions of this Act as may be prescribed with regard to the business carried on by
it in India as if it were a company incorporated in India.
Page 4


CHAPTER-XXII
SECTION 407: Definitions
COMPANIES INCORPORATED 
OUTSIDE INDIA
Section 379: Application of Act to Foreign Companies
Section 591
Companies Act, 1956 
Section 379
Companies Act, 2013
This section was applicable in two 
scenarios:
1. Foreign companies having  a place 
of business in India
2. Foreign companies having business 
in India meeting control parameters  
This section  now does not apply to 
companies who merely have a place 
of business in India unless they have 
business in India and meet the 
control parameters
**Introduction of this section will bring transparency and also prohibits the 
foreign companies to take any benefit from non-compliance of any provisions 
of the Act.
**This section clarifies lot of doubts and applicability of various provisions to 
foreign companies
Section 379: Application of Act to Foreign Companies
Where not less than 50% of the paid-up share capital, whether equity or preference or
partly equity and partly preference, of a foreign company is held by :
One or more citizens of India 
One or more companies or bodies 
corporate incorporated in India
singly or in aggregate
Such company shall comply with the provisions of this chapter and such other
provisions of this Act as may be prescribed with regard to the business carried on by
it in India as if it were a company incorporated in India.
Section 379: Application of Act to Foreign Companies
Key Points:
? Such companies, whether having place of business in India or not shall comply 
with such provisions as may be prescribed.
? The prescribed provisions are not yet notified.
Page 5


CHAPTER-XXII
SECTION 407: Definitions
COMPANIES INCORPORATED 
OUTSIDE INDIA
Section 379: Application of Act to Foreign Companies
Section 591
Companies Act, 1956 
Section 379
Companies Act, 2013
This section was applicable in two 
scenarios:
1. Foreign companies having  a place 
of business in India
2. Foreign companies having business 
in India meeting control parameters  
This section  now does not apply to 
companies who merely have a place 
of business in India unless they have 
business in India and meet the 
control parameters
**Introduction of this section will bring transparency and also prohibits the 
foreign companies to take any benefit from non-compliance of any provisions 
of the Act.
**This section clarifies lot of doubts and applicability of various provisions to 
foreign companies
Section 379: Application of Act to Foreign Companies
Where not less than 50% of the paid-up share capital, whether equity or preference or
partly equity and partly preference, of a foreign company is held by :
One or more citizens of India 
One or more companies or bodies 
corporate incorporated in India
singly or in aggregate
Such company shall comply with the provisions of this chapter and such other
provisions of this Act as may be prescribed with regard to the business carried on by
it in India as if it were a company incorporated in India.
Section 379: Application of Act to Foreign Companies
Key Points:
? Such companies, whether having place of business in India or not shall comply 
with such provisions as may be prescribed.
? The prescribed provisions are not yet notified.
Section 382: Display of name, etc of foreign company
Section 595
Companies Act, 1956 
Section 382
Companies Act, 2013
NO CHANGE