Corporate and Economic Laws

Corporate and Economic Laws

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Corporate and Economic Laws

Corporate and Economic Laws

This Study Material has been prepared by the faculty of the Board of Studies. The objective of the Study Material is to provide teaching material to the students to enable them to obtain knowledge in the subject. In case students need any clarification or have any suggestion for further improvement of the material contained herein, they may write to the Director of Studies.

All care has been taken to provide interpretations and discussions in a manner useful for the students. However, the Study Material has not been specifically discussed by the Council of the Institute or any of its Committees and the views expressed herein may not be taken to necessarily represent the views of the Council or any of its Committees.

Permission of the Institute is essential for reproduction of any portion of this material.

Corporate and Economic Laws

© The Institute of Chartered Accountants of India

All rights reserved. No part of this book may be reproduced, stored in a retrieval system, or transmitted, in any form, or by any means, electronic, mechanical, photocopying, recording, or otherwise, without prior permission, in writing, from the publisher.

Edition:August 2017


:Board of Studies


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The Publication Department on behalf of The Institute of Chartered Accountants of India, ICAI Bhawan, Post Box No. 7100, Indraprastha Marg, New Delhi 110 002, India.

Sahitya Bhawan Publications, Hospital Road, Agra -282 003 August/2017/P2147 (New)

© The Institute of Chartered Accountants of India


Revised Scheme of Education and Training: Bridging the competence gap

The role of a chartered accountant is evolving continually to assume newer responsibilities in a dynamic environment.  There has been a notable shift towards strategic decision making and entrepreneurial roles that add value beyond traditional accounting and auditing.   The causative factors for the change include globalization leading to increasing in cross-border transactions and consequent business complexities, significant developments in information and technology and financial scams underlining the need for a stringent regulatory setup.  These factors necessitate an increase in the competence level of chartered accountants to bridge the gap in competence acquired and competence expected from stakeholders.  Towards this end, the scheme of education and training is being continuously reviewed so that it is in sync with the requisites of the dynamic global business environment; the competence requirements are being stepped up to enable aspiring chartered accountants to acquire the requisite professional competence to take on new roles.

Concurrent Practical Training along with academic education: Key to achieving the desired level of Professional Competence

Under the Revised Scheme of Education and Training, at the Final Level, you are expected to apply the professional knowledge acquired through academic education and the practical exposure gained during articleship training in addressing issues and solving practical problems.  The integrated process of learning through academic education and practical training should also help you inculcate the requisite technical competence, professional skills, and professional values, ethics and attitudes necessary for achieving the desired level of professional competence.

Corporate and Economic Laws: Dynamic Subject Area

Corporate and Economic Laws is one of the dynamic subjects of the Chartered Accountancy course. This subject at the Final level is divided into two parts, namely, Part I: Corporate Laws for 70 marks and Part II: Economic Laws for 30 marks.

Part I: Corporate Laws comprises of the law and procedures under the Companies Act, 2013 and the Securities Laws covering significant provisions of Securities Contract (Regulation) Act, 1956 read with the Securities Contract (Regulation) Rules, 1957 and the Securities Exchange Board of India Act, 1992 read with SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 and SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015.

Part II: Economic Laws comprises significant provisions of select economic laws namely, the Foreign Exchange Management Act, 1999, the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, the Prevention of Money Laundering Act, 2002, the Foreign Contribution Regulation Act, 2010, the Insolvency and Bankruptcy Code, 2016, the Arbitration and Conciliation Act, 1996.

The liberalization and globalization of our economic policies to be in tune with the global changes bring in several reforms in the Corporate and Economic Laws of our country one a day to today basis. These laws are being amended and fine-tuned to be more dynamic, vibrant for corporate growth, infusing more capital into the country and at the same time protecting and safeguarding the interests of various stakeholders. The statutory authority in charge with the administration of these laws, clarify various issues through the notification, clarifications and through the legislative amendments the meaning and scope of certain provisions to implement the provisions of the Act…

The inclusion of significant and relevant amendments

This Study Material is based on the provisions of Company law, Securities Laws, and the Economic Laws which are amended by the concerned authorities vide significant notifications and circulars issued to 30th April 2017. The Study Material is, therefore, relevant for May 2018 and November 2018 examinations.

Further, if any legislative amendments are notified for the period 1st May 2017 till 30th October 2017, students would be informed about the developments through revision test paper (RTP) for May 2018 examination. Similarly, for amendments notified for the period 1st November 2017 to 30th April 2018 students would be informed through revision test paper (RTP) for November 2018

Moreover, students are advised to check the Board of Studies Knowledge Portal regularly for further developments.

The framework of Chapters: Uniform Structure comprising of specific components

Efforts have been made to present the laws in a lucid manner. Care has been taken to present the chapters in a logical sequence to facilitate easy understanding by the students. The Study Material has been divided into three modules for ease of handling by students. The first two modules are on Corporate Laws comprising of Company Law and the Securities laws and the third module is on Economic Laws.

Each chapter of the Study Material has been structured uniformly and comprises of the following components:

Components of

each Chapter

About the component
1.Learning OutcomesLearning outcomes which you need to demonstrate after learning

each topic have been detailed in the first page of each chapter.

Demonstration of these learning outcomes would help you to

achieve the desired level of technical competence

2.ContentThe concepts and provisions of Corporate and Economic Laws

are explained in a student-friendly manner with the aid of

examples/ diagrams /flowcharts wherever possible. Diagrams

and Flowcharts would help you understand and retain the

concept/provision learned in a better manner. Examples would help you understand the application of concepts/provisions.

These value additions would, thus, help you develop conceptual

clarity and get a good grasp of the topic.

3.Exercise Questions

with Answers

The exercise questions and answers would help you to analyze

the provisions of Corporate and Economic Laws and apply them

same in problem-solving, thus, sharpening your application skills.

In effect, these questions would test your ability to analyze,

interpret and apply the concepts/provisions learned in solving

problems and addressing issues. Small case scenarios have

also been given to test your analytical ability and interpretational


We hope that these student-friendly features in the Study Material improve your learning curve and
sharpens your analytical and interpretational skills.