Myth‑Busting Company Law for CUET PG Aspirants

Interviewer (I): What’s the biggest myth students have about the Companies Act 2013?

Student Advocate (S): That filing the annual return is a one‑off. In reality, the return is a continuous obligation. Every year, you must file Form 12A and Form 29/30, or else the Registrar can strike off the company.

I: How about directors’ duties? Many think it’s just a list.

S: Section 166 is a buffet, not a menu. Directors must act in the company’s best interest, exercise care, skill, and diligence, avoid conflicts of interest, and keep the books in order. The Supreme Court in State of Rajasthan vs. M/s. V.P. & Sons made it crystal: a breach can lead to personal liability.

I: Corporate governance seems intimidating. Any shortcut?

S: Think of it like a chess game. The Companies (Amendment) Act, 2019, introduced the mandatory board of directors with at least one woman and one independent director for listed companies. Skipping these roles isn’t just a violation—it’s a strategic blunder.

I: What’s the deal with share capital and debentures?

S: Section 2(29) defines a debenture as a debt instrument, but remember Section 25(1) requires that no debenture be issued in the absence of a debenture policy. The landmark H.K. Laxman vs. State case taught us that ignoring a policy can trigger a winding‑up petition.

I: How do shareholders protect themselves?

S: By understanding the rights under Sections 168–170.