Hon’ble Prime Min­siter of In­dia, Naren­dra Modi

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Shri P.P. Chaud­hary, Hon’ble Union Min­is­ter of State for Law and Jus­tice & Cor­po­rate Af­fairs, was con­ferred the Honorary Fel­low­ship of In­sti­tute of Com­pany sec­re­taries of In­dia (ICSI) at the head­quar­ters of the in­sti­tute at New Delhi. ICSI pres­i­dent CS (Dr) Shyam Agrawal pre­sented the cer­tifi­cate con­fer­ring honorary mem­ber­ship to Shri Chaud­hary and ad­min­is­tered an oath to him. Shri Chaud­hary has con­ducted around 11,000 cases, mostly Con­sti­tu­tional Lit­i­ga­tions for the last 38 years on mat­ters re­lated to land ac­qui­si­tion, farmer’s grievances, labour & ser­vice, cen­tral ex­cise & cus­toms and PILs re­lated to restora­tion of nat­u­ral wa­ter bod­ies and dams. The Honorary Fel­low Mem­ber­ship is granted to dis­tin­guished per­sons hav­ing made sig­nif­i­cant con­tri­bu­tion to the pro­fes­sion of Com­pany Sec­re­taries. In keep­ing with the best tra­di­tion of a pro­fes­sional In­sti­tu­tion, the In­sti­tute con­fers the Honorary Fel­low Mem­ber­ship in recog­ni­tion of valu­able ser­vices for pro­mot­ing pro­fes­sion­al­ism of man­age­ment and best cor­po­rate gov­er­nance prac­tices. The cer­e­mony was at­tended by the ICSI coun­cil mem­bers, sec­re­tary and heads of the di­rec­torates of the in­sti­tute.

The Cen­tral Gov­ern­ment no­ti­fies the Com­pa­nies (Amend­ment) Act, 2017

The Cen­tral Gov­ern­ment no­ti­fied the Com­pa­nies (Amend­ment) Act, 2017 (Amend­ment Act) on 3rd Jan­uary, 2018. The pro­vi­sions of this Amend­ment Act shall come into force on the date or dates as the Cen­tral Gov­ern­ment may ap­point by no­ti­fi­ca­tion(s) in the Of­fi­cial Gazette. A few pro­vi­sions in the Amend­ment Act have im­por­tant bear­ing on the work­ing of the In­sol­vency and Bank­ruptcy Code, 2016 (Code). Sec­tion 53 of the Com­pa­nies Act, 2013 pro­hib­ited is­suance of shares at a dis­count. The Amend­ment Act now al­lows com­pa­nies to is­sue shares at a dis­count to its cred­i­tors when its debt is con­verted into shares in pur­suance of any statu­tory res­o­lu­tion plan such as res­o­lu­tion plan un­der the Code or debt re­struc­tur­ing scheme. Sec­tion 197 of the Com­pa­nies Act, 2013 re­quired ap­proval of the com­pany in a gen­eral meet­ing for pay­ment of man­age­rial re­mu­ner­a­tion in ex­cess of 11 per­cent of the net prof­its. The Amend­ment Act now re­quires that where a com­pany has de­faulted in pay­ment of dues to any bank or pub­lic fi­nan­cial in­sti­tu­tion or non-con­vert­ible deben­ture hold­ers

or any other se­cured cred­i­tor, the prior ap­proval of the bank or pub­lic fi­nan­cial in­sti­tu­tion con­cerned or the non-con­vert­ible deben­ture hold­ers or other se­cured cred­i­tor, as the case may be, for such pay­ment of man­age­rial re­mu­ner­a­tion shall be ob­tained by the com­pany be­fore ob­tain­ing the ap­proval in the gen­eral meet­ing. Sec­tion 247 of the Com­pa­nies Act, 2013 pro­hib­ited a reg­is­tered val­uer from un­der­tak­ing val­u­a­tion of any as­sets in which he has a di­rect or in­di­rect in­ter­est or be­comes so in­ter­ested at any time dur­ing or af­ter the val­u­a­tion of as­sets. The Amend­ment Act now pro­hibits a reg­is­tered val­uer from un­der­tak­ing val­u­a­tion of any as­set in which he has di­rect or in­di­rect in­ter­est or be­comes so in­ter­ested at any time dur­ing three years prior to his ap­point­ment as val­uer or three years af­ter val­u­a­tion of as­sets was con­ducted by him.

Com­pe­ti­tion Com­mis­sion of In­dia im­poses Penalty on Chemists and Drug­gists As­so­ci­a­tion of Bar­oda and Fed­er­a­tion of Gu­jarat Chemists and Drug­gists As­so­ci­a­tion

The Com­pe­ti­tion Com­mis­sion of In­dia (‘Com­mis­sion’) has found the Chemists and Drug­gists As­so­ci­a­tion of Bar­oda (‘CDAB’) and Fed­er­a­tion of Gu­jarat State Chemists and Drug­gists As­so­ci­a­tion (‘Gu­jarat Fed­er­a­tion’) to be in con­tra­ven­tion of the pro­vi­sions of the Com­pe­ti­tion Act, 2002 (‘Act’). One of the stock­ists based in Vado­dara filed an in­for­ma­tion al­leg­ing that de­spite an ear­lier order of the Com­mis­sion in the year 2012, CDAB, through its prac­tices, has con­tin­ued to limit and con­trol the sup­ply of drugs and medicines in the mar­ket by man­dat­ing ‘No Ob­jec­tion Cer­tifi­cate’ (‘NOC’/‘LOC’) prior to ap­point­ment of stock­ists and pay­ment of ‘Prod­uct In­for­ma­tion Ser­vice’ (‘PIS’) charges prior to in­tro­duc­tion of new prod­ucts in the mar­ket by phar­ma­ceu­ti­cal com­pa­nies. In­ves­ti­ga­tion car­ried-out by the Di­rec­tor Gen­eral (‘DG’) re­vealed in­volve­ment of the State Level As­so­ci­a­tion, i.e. the Gu­jarat Fed­er­a­tion, be­sides CDAB, in the al­leged con­duct. Af­ter de­tailed en­quiry, the Com­mis­sion has found that CDAB and the Gu­jarat Fed­er­a­tion were in­dulging in the anti-com­pet­i­tive prac­tice of in­sist­ing NOC prior to the ap­point­ment of new stock­ists by phar­ma­ceu­ti­cal com­pa­nies. Fur­ther, the Gu­jarat Fed­er­a­tion was found to be car­ry­ing on the prac­tice of mak­ing in­tro­duc­tion of new prod­ucts in the mar­ket sub­ject to pay­ment of PIS charge and its ap­proval. Th­ese prac­tices were held to be lim­it­ing and con­trol­ling sup­plies of drugs/medicines in the mar­ket, in con­tra­ven­tion of Sec­tion 3 (3) (b) read with Sec­tion 3 (1) of the Act. Fur­ther, the Com­mis­sion has held of­fice bear­ers of CDAB and Gu­jarat Fed­er­a­tion, namely Shri V.T. Shah (Pres­i­dent, CDAB), Shri Jash­vant Pa­tel (Pres­i­dent, Gu­jarat Fed­er­a­tion), to be re­spon­si­ble un­der Sec­tion 48 of the Act, for their in­volve­ment in the anti-com­pet­i­tive prac­tices. Ac­cord­ingly, CDAB, Gu­jarat Fed­er­a­tion and their of­fice bear­ers, have been di­rected to cease and de­sist from in­dulging in the afore­said an­ti­com­pet­i­tive prac­tice. Fur­ther, the Com­mis­sion im­posed a mone­tary penalty of Rs. 1,08,588/- and Rs. 11,11,549/-, cal­cu­lated at the rate of 10% of the av­er­age in­come of CDAB and the Gu­jarat Fed­er­a­tion, re­spec­tively, un­der the pro­vi­sions of Sec­tion 27 of the Act. Penal­ties of Rs. 34,048/- and Rs. 62,144/-, cal­cu­lated at the rate of 10% of their re­spec­tive av­er­age in­comes, are also im­posed upon Shri V.T. Shah (Pres­i­dent, CDAB) and Shri Jash­vant Pa­tel (Pres­i­dent, Gu­jarat Fed­er­a­tion). This case is yet another ex­am­ple of how com­pet­i­tive mar­kets and fair­play in the dis­tri­bu­tion of drugs/ medicines are be­ing com­pro­mised by the per­sist­ing anti-com­pet­i­tive be­hav­iour of the chemist and drug­gist as­so­ci­a­tions at the Re­gional as well as State level. It is in­deed a se­ri­ous mat­ter that de­spite var­i­ous or­ders by the Com­mis­sion in sim­i­lar cases and spe­cific di­rec­tions through a press no­tice, chemist and drug­gist as­so­ci­a­tions have not mended their ways and have con­tin­ued to in­dulge in such anti-com­pet­i­tive con­duct. Con­sid­er­ing the larger pub­lic in­ter­est in­volved in the dis­tri­bu­tion of drugs/medicines, the Com­mis­sion dep­re­cates such a con­duct and its per­pe­tra­tion in any form by those re­spon­si­ble, be it the As­so­ci­a­tions, Stock­ists/ Dis­trib­u­tor/ Whole­saler/ Re­tailer and the Phar­ma­ceu­ti­cal Com­pa­nies. Given the wide­spread and con­tin­u­ing in­dul­gence in the An­ti­com­pet­i­tive prac­tices, the Com­pe­ti­tion Com­mis­sion of In­dia will be keep­ing a close watch on the con­duct by all such en­ti­ties in var­i­ous parts of the coun­try and would not hes­i­tate to take ac­tion, wher­ever deemed nec­es­sary.

Hon’ble Prime Min­siter of In­dia, Naren­dra Modi

P.P. Chaud­hary, Hon’ble Union Min­is­ter of State for Law and Jus­tice & Cor­po­rate Af­fairs

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