Section 1: Companies Act- Incorporating companies and compliances in India
Updated: Feb 25
Section 1 of the Companies Act generally provides the short title, extent, and commencement of the Act. It states that the Act may be called the Companies Act and it extends to the whole of the country where it is enacted. The section also provides for the commencement of the Act, which is usually determined by the government through a notification.
While Section 1 may appear to be a simple and straightforward provision, it is an important one as it provides the legal foundation for the entire Act. Here are some relevant case laws and rules related to Section 1:
Short title: The short title of the Companies Act is important as it is used to refer to the Act in legal documents and proceedings. In the case of Hindustan Lever Employees' Union v. Hindustan Lever Ltd., the Supreme Court of India held that the short title of the Companies Act is "Companies Act, 1956" and it does not include any reference to the word "Indian".
Extent: The extent of the Companies Act determines the geographic scope of its applicability. In the case of State Trading Corporation of India Ltd. v. CTO, the Supreme Court held that the Companies Act, being a Central Act, extends to the entire country, including the State of Jammu and Kashmir.
Commencement: The commencement of the Companies Act determines when its provisions come into force. Rule 1 of the Companies (Specification of Definitions Details) Rules, 2014, provides that the provisions of the Act shall come into force on such date as the Central Government may notify in the Official Gazette. In the case of S. Sivasankaran v. T. Nagarajan, the Madras High Court held that the Companies Act, 2013, came into force on April 1, 2014, as notified by the Central Government.
In conclusion, Section 1 of the Companies Act may seem like a simple provision, but it plays a crucial role in laying the foundation for the Act's applicability and implementation. It is important to be aware of the relevant case laws and rules related to Section 1 to ensure compliance with the Act.
By Siddharth Dalmia
The StartUp Sherpa
+91-9971799250
dalmiasiddharth1994@gmail.com
