Amended and updated notes on section 378ZS of the Companies Act 2013 as amended by the Companies (Amendment) Act, 2020 and Company Rules made there under. Detail discussion on provisions and rules related to Re-conversion of Producer Company to inter-State co-operative society.
Chapter XXIA PART-XII (Section 378ZS to 378ZU) of the Companies Act 2013 (CA 2013) deals with the provisions related to re-conversion of producer company to inter-state co-operative society. Section 378ZS of CA 2013 provides for Application of provisions relating to Re-conversion of Producer Company to inter-State co-operative society.
Recently, we have discussed in detail section 378ZR (Application of provisions relating to private companies) of CA 2013. Today, we learn the provisions of section 378ZS of the Companies Act 2013.
In exercise of the powers conferred by sub-section (2) of section 1 of the Companies (Amendment) Act, 2020 (29 of 2020), the Central Government appoints the 11th February, 2021 as the date on which the provisions of section 52 of the Companies (Amendment) Act, 2020 shall come into force.
Accordingly, the provisions of section 378ZS are effective from 11th February, 2021. You may refer Notification No. S.O. 644(E) dated 11-02-2021. In this article, you will learn detail of the provisions of section 378ZS the Companies Act 2013.
| Name of Act | The Companies Act 2013 |
|---|---|
| Enacted by | Parliament of India |
| Administered by | Ministry of Corporate Affairs (MCA) |
| Number of Chapters | 29 |
| Number of Sections | 484 (470-43+57) |
| Number of Schedules | 7 |
| You are reading: | |
| Chapter No. | XXIA (PART-XII) |
| Chapter Name | Re-conversion of producer company to inter-state co-operative society |
| Section No. | 378ZS |
| Section Name | Re-conversion of Producer Company to inter-State cooperative society |
| Monthly Updated Edition | Company Law PDF |
Section 378ZS: Re-conversion of Producer Company to inter-State co-operative society
Section 378ZS(1) of Companies Act
Any Producer Company, being an erstwhile inter-State co-operative society, formed and registered under this Chapter, may make an application—
(a) after passing a resolution in the general meeting by not less than two thirds of its Members present and voting; or
(b) on request by its creditors representing three-fourths value of its total creditors, to the Tribunal for its re-conversion to the inter-State co-operative society.
Section 378ZS(2) of Companies Act
The Tribunal shall, on the application made under sub-section (1), direct holding meeting of its Members or such creditors, as the case may be, to be conducted in such manner as it may direct.
Section 378ZS(3) of Companies Act
If a majority in number representing three-fourths in value of the creditors, or Members, as the case may be, present and voting in person at the meeting conducted in pursuance of the directions of the Tribunal under sub-section (2), agree for re-conversion, if sanctioned by the Tribunal, be binding on all the Members and all the creditors, as the case may be, and also on the company which is being converted:
Provided that no order sanctioning re-conversion shall be made by the Tribunal unless the Tribunal is satisfied that the company or any other person by whom an application has been made under sub-section (1) has disclosed to the Tribunal, by affidavit or otherwise, all material facts relating to the company, such as the latest financial position of the company, the latest report of the auditor on the accounts of the company, the pendency of any investigation proceedings in relation to the company under Chapter XIV, and the like.
Section 378ZS(4) of Companies Act
An order made by the Tribunal under sub-section (3) shall have no effect until a certified copy of the order has been filed with the Registrar.
Section 378ZS(5) of Companies Act
A copy of every such order shall be annexed to every copy of the memorandum of the company issued after the certified copy of the order has been filed as aforesaid, or in the case of a company not having a memorandum, to every copy so issued of the instrument constituting or defining the constitution of the company.
Section 378ZS(6) of Companies Act
If default is made in complying with sub-section (4), the company, and every officer of the company who is in default, shall be punishable with fine which may extend to one hundred rupees, for each copy in respect of which default is made.
Section 378ZS(7) of Companies Act
The Tribunal may, at any time after an application has been made to it under this section, stay the commencement or continuation of any suit or proceeding against the company on such terms as the Tribunal thinks fit, until the application is finally disposed of.
Section 378ZS(8) of Companies Act
Every Producer Company, which has been sanctioned re-conversion by the Tribunal, shall make an application under the Multi-State Co-operative Societies Act, 2002 or any other law for the time being in force for its registration as multi-State co-operative society or co-operative society, as the case may be, within six months of sanction by the Tribunal and file a report thereof to the Tribunal and the Registrar of Companies and to the Registrar of the Co-operative Societies under which it has been registered as a multi-State co-operative society or co-operative society, as the case may be.