Right to Apply under Section 241 of Companies Act, 2013
Under Section 241 of the Companies Act, 2013, shareholders, debenture holders, or any class of them can apply to the National Company Law Tribunal (NCLT) if they believe the company’s affairs are being conducted unfairly or against their interests. This means that if shareholders or debenture holders feel the company’s actions are harming them or being conducted unjustly, they can seek legal help by approaching the NCLT. This provision gives stakeholders the power to protect their rights and interests within the company’s governance structure. It offers them a legal path to address issues of oppression or mismanagement and seek suitable solutions to rectify the situation. Overall, the right to apply under Section 241 ensures that shareholders and debenture holders have a way to hold the company’s management accountable and maintain fairness and transparency in corporate governance.
Oppression & Mismanagement : Meaning, Rights & Remedies
The Companies Act, 2013 is a law in India that regulates how companies function. It replaced an older law from 1956 and introduced several changes to improve corporate operations. This law covers various aspects of running a company, such as its formation, financial management, and the rights and responsibilities of shareholders and directors. It also establishes guidelines for activities like mergers, acquisitions, and corporate governance, to ensure transparency and accountability in business practices. The Companies Act, 2013 is significant because it helps create a fair and stable business environment, safeguarding the interests of investors and the public. It is enforced by government bodies like the Ministry of Corporate Affairs and the National Company Law Tribunal.
Geeky Takeaways:
- Companies Act, 2013, promotes transparency and accountability through stricter corporate governance norms.
- The Act empowers shareholders with enhanced rights, including approval for related-party transactions and minority shareholder protections.
- Companies face stricter regulatory oversight, with the Registrar of Companies and other authorities having more powers to investigate and penalize non-compliance.
- The Act mandates corporate social responsibility (CSR) activities for certain companies, emphasizing a commitment to community and environmental well-being.
Table of Content
- Section 241: Oppression and Mismanagement
- Right to Apply under Section 241 of Companies Act, 2013
- Remedies Available under Section 242 of Companies Act, 2013
- Landmark Ruling: Aruna Oswal vs. Pankaj Oswal & Others
- Conclusion
- Oppression and Mismanagement: Companies Act, 2013- FAQ’s