Provision for bonus should be recognised in the year it accrues, charged against profit with adjustments next year.
A provision for bonus must be recognised in the accounts of the year to which the bonus relates, as a charge on profit so the reported profit gives a true and fair view. Differences between the provision and the subsequent payment should be adjusted in the following year-either in the appropriation account or in the profit and loss account-with a note that the adjustment relates to the preceding year.

Approval under section 314(1B) required only for relatives appointed other than as whole time or managing directors.
Approval under section 314(1B) is required only when a relative is appointed in a capacity other than as a whole time or managing director; appointments of relatives as whole time or managing directors are outside that approval requirement, provided the office is not treated as an office or place of profit beyond the managing or whole time director remuneration. Central Government approval under section 269 is required for appointment of a whole time director unless the conditions of Schedule XIII are satisfied.

Amalgamation representation: parties may submit representations to government before sanction under merger provisions in statutory procedure.
Court sanction is required for compromise or arrangement schemes that effect reconstruction, amalgamation or transfer of undertakings, and the court must give notice to the Central Government and consider its representations; the circular states that the power to make such Government representations, earlier exercised by the Company Law Board, is delegated to the Regional Directors, Company Law Board.

Compliance with section 370(1) required when exemption ends; continued inter company loans must be regularised within a limited grace period.
When an exempted lending company ceases to fall within the exemption in sub section (2) of section 370, the exemption ends and section 370(1) becomes applicable to any loans, guarantees or securities continued thereafter; companies must therefore either pass the special resolution or obtain approval or an extension from the competent authority to regularise such continuing transactions within a specified administrative grace period.

Office of profit: appointing a managing director or related entity as sole selling agent requires a company's special resolution.
Appointment of a company's sole selling agent can constitute an office of profit when the appointee is the managing director, a director's relative, a firm in which a director or relative is a partner, or a private company in which a director is a director or member; in those cases the company must obtain shareholder consent by passing a special resolution to approve the appointment.

Prospectus account recency requirement: companies must include accounts up to a date not earlier than six months before issue.
The five year reference in the last paragraph of clause 24(1) is a simple five year period ending three months before issue; therefore every company issuing a prospectus must furnish accounts in the prospectus up to a date not earlier than six months from the date of issue, irrespective of whether the company's financial year closed on a date three months before issue.

Sole selling agency appointments lacking statutory approval condition are void and cannot be validated by later shareholder approval.
An appointment of a sole selling agent made by the board without the prescribed condition that it cease to be valid unless approved at the first general meeting is void ab initio. The missing condition cannot be deemed implicitly incorporated, and subsequent shareholder approval at the first general meeting does not validate or cure the initial invalidity.

Loan disclosure under section 370: special resolutions must state material terms or specify clear lending limits.
An analysis must accompany applications for approval under section 370, setting out loan purposes, interest rate and period, maximum loan by a single company and its proportion to paid up capital, relationship between lender and borrower, prior lending history and related remarks. If proposed lending exceeds the statutory limits requiring Central Government approval, the special resolution must either disclose material terms of each loan (borrower, amount, security, rate) or specify a clear aggregate limit; full details must be provided in the application to the Central Government/Company Law Board.

Terms of payment in prospectus advertisements may be included in press announcements if compliant with section 56.
In press announcements of a proposed public issue of shares, companies may include the terms of payment in the prescribed proforma so long as that disclosure does not contravene section 56, thereby permitting an additional factual element in prospectus related newspaper announcements while maintaining statutory compliance.

Alternate director vacancy occurs when the original director returns to the State of the board's ordinary meetings.
An alternate director vacates office automatically when the original director returns to the State where the board meetings are ordinarily held, regardless of whether the original director attends any board meeting.

Fixing a record date without closing the register is legally ineffective and may amount to an improper register closure.
Fixing a record date without actually closing the register of members is not legally effective if the company intends transfers received after that date not to be considered; such treatment amounts to closing the register from the record date and the statutory consequences of a register closure must be applied.

Inter corporate investment limits clarified: subsidiary and managed company holdings excluded from prescribed limit calculation, approval not required.
Investments specified in sub section (14) are to be excluded when applying the ceilings in sub section (2) and the proviso; holdings by a holding company in its subsidiary and investments by managing agents, secretaries or treasurers in companies they manage (clauses (d) and (e)) do not count toward the prescribed investment limit.

Exemption continuity for inter corporate investments: investments made while exempt remain subject to statutory obligations after cessation.
Investments made by companies falling within the enumerated exemptions remain subject to the provision's regime even after cessation of exemption; inter corporate investments entered into while exempt continue to be governed on cessation, and the administrative instructions applicable under the corresponding Company Law provision are to be applied mutatis mutandis to such investments.

Authorised capital: when shown on share certificates, subscribed and paid up capital must also be indicated.
Section 148 does not require stating a company's authorised capital on share certificates, but if authorised capital is specified the certificate must also indicate subscribed and paid up capital; paid up capital means the amount actually paid at the time the certificates are issued.

Modification of charges by change in law triggers application of charge modification provisions even absent party agreement.
Where the terms, conditions, or extent of operation of a charge are modified for any reason, the provisions of section 135 apply; this includes modifications effected without mutual agreement between the parties, such as alterations arising from a change in law, which remain subject to the statutory charge modification regime.

Board contribution to National Defence Fund excluded from statutory contribution limit under corporate law provision.
A company's board of directors may contribute to the National Defence Fund without that payment being counted toward the limit on board-authorized charitable or public contributions; the Department's view is that such contributions are excluded from calculation of the statutory cap specified for board-authorized donations under the relevant clause.

Signatory requirement for prospectus permits either original or alternate directors to sign based on board meeting circumstances.
When a prospectus discloses both original and alternate directors, it is not necessary that all named directors sign; statutory signature provisions must be read with the rule on alternate directors, and compliance is achieved if either the original directors or the alternate directors sign the prospectus depending on the circumstances.

Name availability guidance: Registrars must refuse proposed company names that are misleading, offensive, or closely resemble existing names.
Registrars must screen proposed company names for confusion, deception, or misuse, rejecting those inconsistent with objects, implying financial or governmental status, offensive, too generic, phonetically or visually resembling existing or dissolved company names, or incorporating trademarks without consent; difficult cases are to be referred to Regional Directors or Headquarters and promoters should be asked to provide multiple distinct names.

Approval requirement for article amendments vs new provisions affects director appointment approval under company law.
Approval by the Company Law Board is not required for insertion of a new provision in the articles concerning appointment or re appointment of a managing or whole time director or a director not liable to retire by rotation; Board approval is required only when an existing provision in the articles is amended, while separate statutory approval is required for the first appointment of a managing or whole time director.

Explanatory statement disclosure must include all material facts for special business resolutions or it will not meet legal requirements.
Section 173(2) mandates an explanatory statement attaching material facts for each item of special business to meeting notices. Managements have omitted key particulars-such as remuneration quantum, proposed appointees' qualifications and experience, and necessity of appointment-or merely made those documents available for inspection, rather than fully disclosing them in the explanatory statement. The Company Law Board views such incomplete disclosure as non compliant with the statute and contrary to sound company practice.