Nomination deposit requirement for director candidacy: refundable upon election, forfeited if the nomination is unsuccessful.
A nomination deposit is required from any person other than a retiring director proposing himself, or any member proposing such person; the deposit is refundable only if the person is elected as director and is forfeited to the company if the person is not elected.

Perquisites ceiling and gratuity treatment clarified for director remuneration, with non taxable retirement contributions excluded from the ceiling.
The amended Schedule XIII prescribes location-based ceilings on perquisites payable in addition to salary and/or commission, excludes non-taxable provident fund, superannuation or annuity contributions from the perquisites ceiling, and treats gratuity as payable over and above perquisites while limiting gratuity to a prescribed amount per completed year of service subject to an overall ceiling.

Compulsory repayment enforcement: Company Law Board can order deposit repayment and punish non compliance with imprisonment and fine.
Amendment to section 58A empowers the Company Law Board to direct repayment of matured deposits and to impose conditions and time for repayment; non compliance attracts imprisonment and a daily fine. Depositors may apply in the prescribed form (in triplicate) with the application fee to the relevant regional bench or the Board may proceed on its own motion; the amendment covers matured deposits unpaid before commencement.

Disclosure of particulars in board report: rules apply to companies with annual accounts closing on or after effective commencement.
The Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are operative from April 1, 1989 and apply to companies whose annual accounts have closed on or after that date, establishing the required disclosure regime for the Board of Directors' report.

Application of Section 370 to section 25 companies: loans and guarantees governed by subscribed capital and free reserves.
The limits of section 370 apply to companies limited by guarantee: if the company has share capital, compute ceilings by reference to subscribed capital and free reserves; if it lacks share capital, compute ceilings by reference to free reserves alone; guarantees and security attract section 370 regardless of share capital. The provision applies unless an exemption under subsection (2) is available.

Remuneration disclosure threshold clarified: annual threshold applies for full year employees and prorates for non standard financial years.
Disclosure obligations require prescribed particulars for employees meeting the remuneration thresholds: an annual threshold for those employed throughout the financial year and a monthly threshold for part year employees, with the annual threshold to be applied on a pro rata basis where the company's financial year is shorter or longer than 12 months.

Deemed public company status arises when private firms invite and accept deposits by advertisement, effecting conversion on acceptance or renewal.
A private company that invites and accepts deposits from the public by advertisement is deemed to have become a public company upon such acceptance; acceptance by other means does not cause conversion. The circular dated 13 4 1989 clarifies that deposits accepted after an advertisement prior to 15 June 1988 will render the company deemed public only when any such deposit is renewed, the deemed conversion taking effect from the renewal date.

Conditions for appointment of managing directors determine when government approval is required based on profit adequacy.
Conditions for appointment of managing or whole-time directors are required to be satisfied only at the time of appointment; subsequent non compliance during tenure does not necessitate Central Government approval. Profit-related eligibility under clause (f) requires adequate net profits computed under sections 349-351 in the immediately preceding year or in any three of the four years prior; if profits are inadequate or cannot be computed, Central Government approval is required. Depreciation for profit computation is determined by the written down value method at Schedule XIV rates, applied to assets as shown in the books at year end.

Managerial remuneration: increases compliant with prescribed Schedule terms require no government sanction and no fresh shareholder filings.
Increase in managerial remuneration need not obtain Central Government sanction if it conforms to the terms in Part II read with Part III of Schedule XIII; where an earlier shareholders' resolution already covers the proposed increase or the comparable reduction requirement in Part III, no further resolution need be passed and no return need be filed with the Registrar of Companies.

Deemed public company rules: private firms exceeding the turnover threshold convert to public status after a three year period.
Private companies whose average annual turnover over the relevant period of three consecutive financial years equals or exceeds Rs. 5 crores will be covered by the Explanation to section 43A and shall become public companies by virtue of section 43(1A) upon expiry of three months from the last date of the third financial year of that relevant period.

Managerial remuneration approval exemption when profits are absent; Schedule XIII compliance and salary cut condition allow payment without approval.
Central Government approval is unnecessary for managerial remuneration during loss or inadequate profits if the appointment adheres to Schedule XIII and the general meeting resolution provides for the salary cut required by paragraph 2 of Part III of Schedule XIII; if remuneration is commission only under paragraph 2(ii) of Part II (Commission) of Schedule XIII, no remuneration is payable in case of loss.

Government approval for managerial appointments unnecessary where appointment complies with statutory appointment provision under companies law.
Where a managing or whole time director is appointed or re appointed in accordance with the statutory appointment provision, no Central Government approval under section 268 is required; compliance with the procedural and substantive requirements of the statutory appointment provision dispenses with separate sanction under the separate approval provision for managerial personnel.

Balance-sheet technical scrutiny checklist requires companies to annex a detailed compliance proforma when filing with the Registrar.
Proposes a standardised proforma to be annexed to company balance-sheets filed with the Registrar under section 220 to enable technical scrutiny and ensure compliance with the Companies Act and Schedule VI. The checklist requires confirmations and particulars on register closures and advertisements, Directors' Report disclosures, auditors' reports and qualifications, borrowings and secured loans compliance, investments and related party transactions, loans to affiliates and directors including statutory limits and approvals, dividend treatment and unpaid dividends, asset registration and disposals, managerial appointments and approvals, meeting and record compliance, and specified operational break ups per Schedule VI.

Unpaid dividend transfer procedures: companies must follow rules, assist claimants and update processes to facilitate recovery.
Amounts unclaimed for three years must be transferred to the General Revenue Account and claims processed under the Companies Unpaid Dividend Rules. Companies should enable survivorship transmission by article amendment, publicise dividend payment authorisation to nominees or bankers, promptly update shareholder addresses, assist claimants, display the prescribed rules and claim formats at the registered office, discontinue redundant endorsements on account payee warrants, consider extending warrant validity, notify particulars of transferred dividends in AGM notices, and apply the revised indemnity bond threshold for larger claims.

Name reservation criteria: use of restricted words requires prescribed authorised capital and placement conditions for company name allotment.
Guidelines tie permissibility of specified key words in proposed company names under sections 20 and 21 to prescribed minimum authorised capital levels and to whether the word is the first word of the name or appears elsewhere; separate authorised capital thresholds are specified for categories such as "Corporation," international descriptors, national identifiers, "Industries/Udyog," and commercial designations, with the latter contemplated for companies carrying on multiple activities or changing their name.

Name availability application requirements: full promoter signing, matching subscriber details, registrar to obtain no objection letters and act promptly.
Applications for name availability must be fully completed and signed by one or more promoters, including names and addresses of prospective directors/promoters and applicants. Registrars must verify that subscribers to the memorandum and articles match the promoters/first directors listed in the application and obtain a No objection Letter from any promoter who later declines participation, while disposing of applications within the prescribed timely period and corresponding with applicant promoter(s).