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Unit 1: Nature of the Companies Act, 1956

9. Government Companies (s.617). Notes
10. Nidhis or Mutual Benefit Societies declared as such by the Central Government by
notification in the Official Gazette [s.620A(2)].

11. Producer Companies (s.581A to 581ZT).
1.1.3 Non-applicability of the Act

The Companies Act, 1956 is not applicable to certain associations. These are:
1. Companies established under Special Acts of Parliament, such as Life Insurance
Corporation of India, Indian Airlines Corporation, (s.616).
2. Partnership firms which are governed by the Indian Partnership Act, 1932.
3. Co-operative Societies which are governed by the Co-operative Societies Act, 1912.
4. Trusts which are governed by the Indian Trusts Act, 1882.
5. Societies registered under the Societies Registration Act, 1860.

1.1.4 Scheme of the Act

The scheme of the Act may be considered broadly under five heads, corresponding to the
different parts it has. They are:
1. Formation of Company (Parts II to IV): The provisions of the Act relating to the formation
of a company include: (a) Incorporation of a company. (b) Memorandum and articles of
association. (c) Prospectus. (d) Issue of shares and debentures. (e) Certificate to commence
business.
2. Management and Administration of Company (Part VI): Under this head, the following
provisions are included: (a) Registered office and name of the company; (b) Members and
debenture holders; (c) Meetings and proceedings; (d) Managerial personnel; (e) Managerial
remuneration; (f) Accounts; (g) Audit; (h) Investigation; (i) Directors; (j) Managing
directors; (k) Managers; (l) Arbitration, compromises, arrangements and reconstructions;
(m) Prevention of mismanagement and oppression.
3. Winding up of Company (Part VII): The Act contains the following provisions as regards
to the winding up of companies, viz., (a) Modes of winding up; (b) Winding up by the
court; (c) Voluntary Winding up; (d) Winding up subject to the supervision of the court.
4. Miscellaneous Provisions (Parts V and VIII to XIII): These include: (a) Registration of
charges; (b) Application of the Act to companies formed under previous company laws;
(c) Winding up of unregistered companies; (d) Foreign companies; (e) Registration offices
and officers and fees; (f) General. The Act is then followed by 15 schedules which, deal with
various matters provided in the Act.
5. Producer Companies (Part IX A).

Self Assessment

Fill in the blanks:
1. .................................. is codified in the Companies Act, 1956.
2. Companies formed and registered under the ......................................

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