 blu no r of 1$ tim companies-(amendment) bill, 1963 a billfu:rtke7 '0 amend the compg",ie act, 1956, be it enacted by parliament in the fourteenth year of the republic of india as follows:-1 (1) this act may be called the companies (amej:ldment) act, short title 1963 dd com-djedcemedt s (2) it shall come into force on such date as the ·central government may, by notification in the oftlcial gazette, appoint, and different dates may be appointed for different provisions of this ac', lofj9s6-2 in section 2 of the companies act, 1956 (hereinafter referred ameddment 10 to as the principal act),-ofaec:ti0d2 (a) atter ~lause (10), the following clause shall be inserted, namely:~ - (loa) "company law board" means the board of company law administration constituted under section 15 loe;'; (b) a£ler clause (49), the following clause oa11 be inserted namely:-- (49a) "tribunal" means the tribunal constituted under section loa;' 20 3 after section 10 of the principal act, the following sections iaaertiod of shall be inserted in part i, namely:-:gr~': to idpart i 'ya (1) tile cent gover_ent ida, j t, botlftattion in cooititution 6e eftirial gueuie, constitute - trd8aal ~,of 5 many of tribunal membns 88 it! diidb fit, to exercise  di8c1uwp- 25 (a) the powers and functions conferred on such tribunal by or under this act; 1401 (b) ls-1 (b) the powers and functions conferred on the court by or under section 203 in so far as it relates to the granting of leave under that section and sections 397 to 407; and (c) such other powers and functions conferred on the court by or under this act as the central government may, s by notification in the official gazette, specify: provided that where any powers and functions are or become exercisable by the tribunal by virtue of this section, the court shall not exercise those powers and functions and any reference to the court in any of the s,ections, powers and functions of the 10 court whereunder have been conferred on the tribunal, shall be construed as a reference to the tribunal (2) the members of the tribunal 'shall be persons who appear to the central government to have adequate knowledge of, and experience in,-is (a) law, or (b) matters of accountancy, or (c) administration or management of companies and law relating thereto (3) the central government shall ordinarily appoint one 20 of the members of tribunal having knowledge of, and experience  in law, who-(a) is or has been a judge of a high court; or is qualified for appointment as judge of a high 25 (b) court; to be the chairman of the tribunal (4) the chairman and other members of the trlbunallhall receive from the central government lueh remudel'8tion, and shall be ifovemed by sueh conditions of service, as the central government may determine: 30 provided that the remuneration of the chairman or any other member shall not be varied to his disadvantage after his appointment (5) nothing in this section shall derogate from the powers and functions of the court in relation to any proceeding pending 3s before the court immediately before such powers and functions are or become exercisable by the tribunal by virtue of this section and the court shall dispose of such proceeding according ly  tothe companies (amendm~nt) bill,1963 (to be/as introduced 4n lok sabha) 1 page 2, line 27,-for "chairman" read "chainman" 2 page 4, line 33,-for "panel" ~ "penal" 3 page 5, line 8,-for "prefering" ~ "preferringll 4 page 6, line 3,-for "loan" read "loans" --5 page 6, line 38,-after "and" insert " " , 6 page 6, 11ne,38,-)  :,~ after "~rt1cu1ar" inseifrt 11 " , 7 page 7, line 31,-before "holds" omit -" " , - 8 page 8, lines 13 and 14,-for "mange-ment" ~ "manage-ment" 9 page 12, in clause 13,-for the marginal heading to new section-63sa, -read--"protection of acts done in good faith" 10 page 12,-for the marginal heading to clause 14,~a4 - if amendment of section 637 11 11 page 12, line 13,-after "conditions" f2!: "" ~ " " , 12 page 12, line 25,-after "347 (2)" insert " " , 13 page 15, line 22," for " nd" read " and" -14 page 15, line :2~,  for "say" read "s ay" 15 page 1:5, line 3 from bottom,-omit ii a" -16 page 17, line 7  , for "of" read "or" 17 correct line numbers on pages, 7, 10, 11 and 12 ',-,r • ;-\ (c) compelling the production of documents, (d) examining witnesses on oath, (e) granting adjournments, (i) reception of evidence taken on affidavit, (9) issuing commissions for the examination of wit-5 ne&aeb, and summoning and examining no mgltu afty penon whose evidence appears to the tribunal to be material (2) where the tribunal has reason to believe that tany place is used for the deposit or custody of any dqc1uqeni or thing which may be material for the purposes of any proceeding be- 10 foi!e it, the tribunal may by its'warrant authorise ad di1"ect any police oftlcer above the rank of a constab~ (a) to ~nter that place with such assistance as may be required, (b) to search the same in the manner specified in tlle is warrant, (c) to take possession of any documents or things therejn found and to ~epare a list of the same and te dispclsle them of in accordance with the pro\lisions hereinafter contained 20 (3) when in the execution of a search w,"rra:nt uadu subsection (2) any document~ or things for whkh search is made are fou~d, such documents or things, togetber with the list of t~e same, shall immediately be taken before the tribunal (f) the p:r<wisions- of the code of crimin-al proc'!dur-, 1898 25' of 1898· shall, so tar as lilay be, awly to a seuch d;rected, and a search warrant issued, under sub-section (2) as they 8ljply to a search and a search warrant under sectlon 98 of that c04e (5) 'nw 'pribudal sha-tl be deemed te be a eim court for the ptq>oses of aecuon 195 and chapter xxxv of the corle of crimi- 30 nal procedure, l898 and evprv pl'oceedin~ before the tribadei shall be deemed to be a judicial proceedinj! within tjae meailli:tg of sections 193 and 228 of the indian panel code and for the purof' of 1860 pose of section 19ft of that code ion (l) save as otherwj~p orovined in this act an li1'liteal 35 shall lie only on questions of law arising out of any decision, = decision of the tribunal findin~ or order of t~ tribunal to the hhzh court havinj! iurisdiction in relation to t~ place at wlw:h the· register'" ofllce of the company concerned is situate (2) every such' appeal shall be heard by a bench of not less than two judges of the high court (3) every such appeal shall be filed within the period of sixty days from the date of the decision, finding or order of the s tribunal: provided that the appeal may be admitted after the expiry of the aforesaid period if the appellant satisfies the high court that he had bufticient cause for not prefering the appeal within that period' 10 4 in the principal act, after part i, the following part and sec- insertion of tion shall be inserted, namely: -:f:r~ ii~  'part ia", $ is 20 board of company law administration 10e (1) as soon as may be after the eommercement of the constitution companies (amendment) act~ 1963 the central gov8l'bment ~a;:: of shall by notificatioll in the official gazette, coastitute a board law ad~i­to be called the board of company law adrninistratien te exercise niatration and tlischarge such powers and fuadieds cenferred 8r the central goyel'lulaellt by or under this ad or any ether law _ may be edtrusted to it by that govenll  t (2) the company law board shall consillt of such number of members, not exceeding five, as the central govenmient deems fit, to be appointed by that government by notification in the official ga2:ette (3) one of the members shall be appointed by the central gowrnment to be the chairman of the company law board (4) no act done by the c(}mnffnv law board shall be called in question on the ground only of any defect in the constitution of, or the existence of any vacancy in, the company law board 30 (5)· the procedure of the company law &ani &hell be such _ rlay be prhcribed (6) in the exercise of its powers and discharge of its funct;on8, the company law board shall be subject to the control of the central government' 5 in section 81 of the principal act,-3s amend meat of sectioil 81 (a) for the proviso to sub-section (3), the foriowing proviso small de substituted, namely:-40 "provided that the terms of issue of su£h debentures or the terms of such loans inelude a term providing for such optioq and such term-(a) either has been approved' by the central government before the issue of debentures or the ,raising of the loan, or is in confonnity with the rules, if any, made by that government in this behalf; and (b) in the case of debentures or loans other than s debentures issued to, or loans obtained from, the government or any institution specified by the central government in this behalf, has also been approved by a special resolution passed by the company in general meeting before the issue of the debentures or the raising 10 of the loans"; (b) after sub-section (3), the following sub-sections shall be inserted, namely:-" ( 4) notwithstanding anything contained in the foregoing provisions of this section, where any debentures have is been issued to, or loans have been obtained from, the government by a company, whether such debentures have been i~ued or loans have been obtained before or after the commencement of the companies (amendment) act, 1963, the central government may, by order, direct that such deben- 20 tures or loans or any part thereof shall be converted into shares in the company on such terms and conditions as appear to the government to be reasonable in the circumstances of the case, even if the terms of issue of such debentures or the terms of such loans do not include a term 2s providing for an option for such conversion:  provided that if the terms and conditions of such conversion are not acceptable to the company, the company may, within thirty days of the communication to it of such order or within such further time as may be granted by the 30 high court, prefer an appeal to the high court in regard to such terms and conditions and the decision of the high court on such appeal and, subject only to such decision, the order of the central government under this sub-section shall be final and conclusive 3s (5) in issuing any order under sub-section (4), the central govertlment shall have due regard to the financial position of the company, and in particular to the terms of issue of the debentures or the terms of the loans, as the case may be, and the rate of interest payable on the debentures 40 or loans, the subscribed capital of the company and its loan liabilities, its reserves, its profits durin~ the preceding flve years and the current market price of the shares of the company" • after section 153 of the principal act, the following section insertiod of new sechon shall be inserted, namely:-ls3a after icction is3 "153a (1) where any shares in, or debentures of, a com- dcclaretion pany are held in trust by any person (hereinafter referred to as :~o ~:~ the trustee), the trustee shall, within such time and in such form tures held in as may be prescribed, make a declaration to the registrar trust (2) a copy of the declaration made under sub-section (1) shall be sent by the trustee to the company concerned, as soon as may be, after the declaration has been sent to the registrar 10 (3) if a trustee contravenes any provision of this section or makes any statement in the declaration which is false and which he either knows or believes to be false or does not believe to be true, he shall be punishable with imprisonment for a term which may extend to three years and also with fine (4) the provisions of this section and section 187b shall not apply in relation to a trust-(a) where the trust is not created by instrument in writing; or 20 (b) even if the trust is created by instrument in writing, where the trust money invested in shares in, or debentures of, a company-(i) does not exceed one lakh of rupees, or (ii) exceeds one lakh of rupees but does not exceed either five lakhs of rupees or twenty-five per cent of the paid-up share capital of the company" 25 7 after section 187a of the principal act, the following section lnaertion of shall be inserted, namely: -~;b ~~ section 187a 35 ""1878 (1) notwithstanding anything contained in this act e&crc:isc of or any other law or any contract, memorandum or articles, yotinl ri1htfl in reapect 0 where a member or debenture-holder of a eompany (hereinafter sharea and referred to as a truste";), holds shares in, or debentures of, the ~:~:='t company for the benefit of any other person, the central government may, if it considers necessary so to do in the public interest, appoint such person, as it thinks fit, to exercise at any meeting of the company or at any meeting of any class of members of the company or at any meeting of the debenture-holders of the company, as the case may be, the same rights and powers (including the right to vote by proxy) as the trustee would exercise as a member or debenture-holder at such meeting and thereupon the trustee shall not exercise any such rhts and powers as aforesaid (z) in order to enable the persod appointed by the central government under sub-,section (1) to exercise the rights and powers as aforesaid, that person i;ball alllo be entitled to raeeive an books and papers under this act as if he were a member or - debenture-holder" 5 8 in the principal act, in part vi, after chapter iv, the following chapter and sections shall be inserted, namely:- "chapter iv a-powers of central government to remove managebial personnel from ofji'lce on the recommehdation ofthj: tjwmnal 10 388b (1) w~re in the opinion of the central government there are circ:\hilstances suggesting-idlcrtion of dew chapter &ad sections in part vi (a) that any person concerned in the conduct and mangement of the affairs of a company is or has been in connection therewith guilty of fraud, misfeasance, negligedce or default is in carrying out his obligations and functions under the law, or breach of trust; or reference to tribunal of ciiei llainst idild8&erial personnel (b) that the business of a company is not or has not been conducted and managed by such person in accordance with sound business principles or prudent commercial prac- 20 tices; or (c) that a company is or has been conducted and managed by such person in a manner which is likely to eauae, or has caused, serious injury or damage to the interest of the trade, industry or business to which such company pertains; 25 or (d) that the business of a company is or has been conducted and managed by such person with intent to defraud its creditors, members or any other persons or otherwise for a fraudulent or unlawful purpose or in a manner prejudi- 30 cial to public interest, the central government may state a case against tbe person aforesaid and refer the same to the tribunal with a req1lest that the tribunal may inquire into the case and record a ftrdi  as to whether such person is a fit and proper pefson to hold 1ihe office 35 of director or any other office connected with the coftduet and management of any company (2) every case under sub-section (1) shall be stated ja the ~rm of an applfcation which shall be presented to the tribunal  61" such officer thereof as it may appoint in this behah (3) the per,n· against whom a case is reft!rred to the tribu-s nal under this section shall be joined as a respondent to the ·ppllcaucin~ (4) every such application-1'0 (a) shall contain' a concise statement of such circumstanees :anli materials as the central go'v'etntrient m:ay ebnsider necessary for the purpose of the inquiry, and (b) shall be signed and verified in the manner laid down in the code ()f civil procedure, 1908, for the signature and verification of a plaint in a ,guit by the central government (5) the tribunal may at any stage of the proeeedift'gs allow the central government to alter or amend the application in such manner and on such terms as may be just, and all sueh' amendments shall be made as may be necessary for the purpose of 20 25 4~~rmintng the real questions in the inquiry  388c (1) where during the pendency of a case before the !~~" tribunal it appears necessary to the tribunal so to do in the ~  interest of the members or creditors of the company or in the' public interest, the tribunal may on the application of the central government or on its own motion, by an order-(4) diteet that the respondent shall 'nbt discharge any of the duties of his obice uhtil further orden of the tti·bunai, and (b) appoint a suitable person in place of the respondent to discharge the duties of the oidce held by the  respondent subject to such terms and conditions as the tribunal may' specify in the order 450f r,6o (2) every perlon appointed under clause (-b) of sub-section (1) shall bedeemed to be a public servant within the meaning of section 21 of the indian penal code 35 -388d at the conclusion of the hearing of the case, the tribu-~ec:ili0d of nal shall record its findi"s stating therein speciftcally if the ~~buaal tribunal considers the respondent as being not a fit and proper personto hold ~he office of director or any o~her office connected ~th tlie conduct and management of any company 888e (l) an appeal shalllieqlftly oil quefltions of law «riling appeal to 'out ef ,the·· ftncungs of the tri-bunal to the ,high court withia the ifjjh court od quatiodi oflaw local limits of whose jurisdiction the place at which the tribunal has held its sittings for the purpose of the inquiry under section 388b, is situate and every such appeal shall be heard by a bench  of not less than two judges of the high court : provided that where the tribunal hal held its sittinp at s more places than one and such places are situate within the local limits f the jurisdiction of different high courts, the appeal shall lie to the high c011rt within the local limits of whose jurisdiction the appel~nt at the time of the flung of the appeal ordinarily resides 10 (2) every such appeal shall be filed within a period of sixty days from the date of the finding of the tribunal: provided that the appeal may be admitted after the expiry of the aforesaid period if the appellant satisfies the high court that he had sufticient cause for not preferring the appeal within 15 that period power of centralgov'-ernmedt to remov, iijadiiuial ~rsoadcl od the bai,of tribunal', tia4ijiia 388f (1) notwithstanding any other provision contained in this act, the central government may, by order, remove from ofbce any director, or any other person concerned in the conduct and management of the affairs, of a compay, against whom there 20 is a finding of the tribunal or a decision of a high court under this chapter: provided that where a firm or a body corporate is concerned in the conduct and management of the afta!rs of a company as its managing a~nt or secretaries and treasurers, and the finding 2, of the tribunal or the decision of a high court is aealnst any partner in such firm, or any director of, or any person holding a general power of attorney from, such body corporate, the central government may also remove from the offtce of managing agent or secretaries and treasurers such firm or body corporate 30 (2) no order under this section shall be made against any person unless he has been given a reasonable opportunity to show cause against the same: provided that no matter shall be raised by such person before the central government ii such matter has been decided 35 by the tribunal or the high court (3) the person against whom an order of removal from office is made under this section shall not hold the oftlce of a director or any other office connected with the conduct and management of the affairs of any company during a period of 40 five years from the date of the (lrder of removal, (4) notwithstanding anything contained in any other provi lion of this act, or any other law or any contract, memorandum or articles, on the removal of a person from the office of a direc· tor or, as the cue may be, any other oftice connected with the conduct and management of the affairs of the company, that person shall not be entitled to claim any compensation for the l)ss or termination of office 10 (5) on the removal of a person from the office of a director or, as the case may be, any other oftice connected with the conduct and management of the affairs of the company, the company may, with the previous approval of the central gov· ernment, appoint another person to that office in accordance with tl1e provisions of this act" i' t in section 397 of the principal act-(0) in sub-section (1), for the words "are being conducted", 397· the words "are being conducted in a manner prejudicial to 'pub lie interest or" shan be substituted; (b) in sub1ection (2), in clause (a), for the words "are being conducted", the words "are being conducted in a manner prejudicial to public interelt or" shall be substituted 20 10 in sub-section (1) of section 398 of the principal actr-(4) in clause (4), for the words "are being conducted", the 398 words "are being conducted in a manner prejudicial to public intereat or" shall be substituted; (b) in clause (b), for the words "will be conducted", the words "will be conducted in a manner prejudicial to public in· terest or" shall be lubstituted 30 11 in 8ub-eection (1) of section 408-(0) after the words "if the central government", the words "of its own motion or" shall be inserted (b) after the words "interests of the company", the words "01' to public interest" shall be insened 35 u in part vi of the principal act, in chapter vii, after section iasertion of '1' the following section shall be inserted, namely:-"41 sa the provisions of this chapter shall apply in rela prov~odt of tion to the company law board as they apply in relation to the ~:ppl' ~ central government in respect of any matter in relation to ~ wb,tch, the powers and functions of the' central ~vernment uader'sections 410 a1)d 411 have been delegated to t4~: c()~pany iaa,w board under section 637 fl '  13 after se~tion ~5 of the princ:ipal act, the fouowmg section ijbell be illsened, namely:-5 lliienion of new eection 63sa after scctioll 635· protection of acta doae in ,ood faith cc635a no suit, prosecution or othe~ 1"al p~pc~ng shall lie against officers of government for ajlyt~g vihiqp ~, ~good faith done or inten~d to be done in pw:-s'a~c, at uu ~t or any rules made thereunder" " i f~r sab-sections (1) and (2) of s~ti~ 637 0( ~9:~ pii~ipal 10 act, the following sub-sections shall be substituted, namely:-amendment ur section 637· cc (1) the central g9ver~ent may, by noti8cation in the official gazette and subject to such conditions restrictions and  liljdtati01;ls as may be specified therein, delegate- (a) any of its powe~s o~ func~o~ ~ ~ act (pther is than the power to make rules) to the company law board; (b) any of its powers or functions un4er this act • other than those' specitl~ in bub-section (2), to s,!c~ ()~~:r • »thorit)r or such oft!eer as may be specified in the notification ~} 'die powers and functions which cannot be delegated 20 muier clause (b) of sup-s~ti9n (1) aj;e th~ c:o¢e~~~d by or mentiqneci in the fo1l9'wing pfovisions ~ this act, n~y  sections 10, 89(4), 211 (3) iwq, (4), 212, 2~a,2~~,·3ia 241, 242, 243, 244, 245, 247, 248, 249, 250, 259, 268, 2~9, 274 (2) , 29i, aoo 310, su, s24, 328 328, 329, 332, 343, m5, '346, 347 (2)  2s me 352 88&, &72, 396, 399(4) and (5), 4(}1,408, ~,410, 4t-~(b), 448, 609, 613, 620,638,641 and·-m2!' ~ ~ ~ ~~~a~ quick action against persons involved in cases of fraud, misfeasance and other such malpractices and irregularities in the management of companies, it is considered necessary to set up a tribunal whose findings would enable the central government to remove such persons from positions of managerial authority in any company this tribunal will also be empowered to hear certain applications under section 203 and sections 397 and 398 of the companies act, as these relate to matters of a similar nature the scope of sections 397 and 398 and other related sections is being enlargec:l to provide for the entertainment of applications on grounds of public interest as well besides those stated therein this tribunal will also be empowered to exercise the powers and functions of the court under such sections of the companies act as the central government may, from time to time, notify in order to prevent the use of voting rights attached to shares held by trusts for the advancement of personal interests of the donol's, it is considered necessary to regulate the exercise of such rights in suitable cases for this purpose, it is proposed to empower the central government to appoint a person to exercise voting rights in respect of trusts with significant share holding, when necessary, with a view to securing proper management of the company in the interests of the shareholders in cases where government has advanced a loan to a company, it is considered necessary that government should have the power to direct the conversion of such a loan into shares of that company on fair and equitable terms where the loan agreement provides for such conversion, it is proposed to dispense with the procedure prescribed under section 81: of the companies act in regard to such conversion of loans given by government and specified financial institutions section 81 is proposed to be amended accordingly further, it is considered desirable, for the better and convenient administration of the companies act, to set up a board to which w1ll be entrusted most of the powers and functions of the central government under the companies act or other laws the board will function subject to the control of the central government in all matters the bill seeks to amend the companies act to give e1!ect to the above proposals t t krishnamachari new delm; the 14th november, id63 the bill aeeks inter alia to set up a tribunal to enquire into c of m1i-conduct of various types en the part of company managements and an administrative board to exercise such powera and functions of the central government under the companies act or under any other law, as may be assigned to that board by that government the provision for the setting up of a tribunal will necessitate the appointment of chairman and members of the tribunal and some additional taft as far as can be anticipated at present, the expenditure on this account together with incidental expenses on administration to be met out of the gonsolidated fund of india is estimated at - about ri 1,50,000 per annum as indicated below: | r -               |  "",          ||-------------------|----------------|| of                |                || "11",""           |                || rt4              |                || ~                 |                || i                |                || ojflem            |                || j1te             |                || 1                 |                || a                 |                || ual               |                || coni              |              || ,""",,"      |                || ra               |                || x                 |                || ,,2,000           | 04;1,000       || 3                 |                || i                 |                || x                 |                || 27,000            |                || 54               |                || 000               |                || x                 |                || 9,000             |                || 9°°0             |                || chairan          | of             || memben            | of             || 2                 |                || reaitrar         |                || company           |                || accowltidt        |                || 1                 |                || x                 |                || 7,300             |                || 7,200             |                || a                | """"           || conaist:q         | of             || stedoif&phen      |                || nc!               | lower diviaion || clerk,            |                || 1303              |                || 00                |                || 3                |                || r                 |              || ddi               |              || ,al               | "''''''"       || includiq          |                || clan              |                || iv                | ad,            || allowances       |                || liccoiiudodation, |                || furniture        |                || etc              |                || 25000            |                |,,, total 1,50>400 or say 150 ,000 -----------------------------------------------------------------------------the provision for the setting up of a board may not involve any fresh expenditure from the consolidated fund as it is expected that the board would be able to function with the help of the officers and a stafj who are now borne on the strength of the department of revenue for dealing with the administration of the companies act clauses 3, 4 and 60f the bui empower the central government to make rules in respect of matters which, inter :alia, relate to the strength of every bench of the tribunal, the procedure o1llii i'rib\hlal and 'benches thereof, the procedure to he followed 'bftbe proposed board of company law administration, and the form in which a declaration may be made under subsection (1) of the proposed s~ction 153a ' the matters in respect of which rules may be made 'are' jdattert of proeedure at adl'ilinijtnttft ctetatl the dele«tiofl,'of ~ive power f1f, tmrefore, 6f a normal cibaraem (1 of 1958) - - - - pallt iii prospectus and allotment, and other matl'ers relating to issue of shajlj!'s 'of debbntuus - - - - fv:rthe,' issue of capital m 0) - - (3) nothing in this section shall apply-- - folrthr issue of capital  (a) to a private company; or (b) to the increase of the subscribed capital of a public company caused by the exercise of an option attached to debentures issued or loans raised by the· company-(i) to ooilvert such debentur~ or loans into shares in the company, or (ii) to subscribe for shares in the company: provided that the terms of isaue of such debentures or the terms of such loans include a term provdding for such option and such term-(a) has been approved by a special resolution passed by the company in general meeting ·before the issue of the debentures or the raising of the loans; and also (b) either has been approved by the central government before the issue of the debentures or the nlisidg of the loans, or is in conformity with the rules, if any, madeby that government in this behalf - - - - part vi  - managduht and administration - • - chaptbr vi-pu:vl:ntion of oppression and mismanagemfont a powera of courta~tlon 387 (1) any members of a company who eomp1ain that the aftairs :uef jut for of the company are being condueted in a manner opprehive to any cueao~ member or members (including anyone or more ofthemle}ves) may oppre88l0n apply to the court for an order under thia hctiol1, provicled euch members have a ri~t 10 to apply in virtue of aacbiad • (2) if, on any application under su~tion (1), the court is of opinion-(a) that the company's affairs are beinl conducted in a manner oppressive to any member or members; and (b) that to wind up the company would unfairly prejudice such member or members, but that otherwise the facts would justify the making of a wind!ng-up order on the ground that it was just and equitable that the company should be wound up; te court may, with a view to bringing to an end the matters complained of, make such order as it thinks fit 398 (1) any members of a company who complain-application  to court for () ha h _111' f th b  d ted' relief in a t t t e auali's 0 e company are mng cod uc in eases of a manner prejudicial to the interests of the company; or misman8lement • (b) that a material change (not being a change brought about by, or in the interests of, any creditors including debenture holders, or any 'class of shareholders, of the company) has taken place in the management or control of the company, whe-,ther by an alteration in its board of directors, or of its managing agent or secretaries and treasurers or manager, or in the constitution or control of the firm or body corporate acting as its managing agent or secretarie6 and treasurers, or in the ownership of the company's shares, or if ijt has no share capital, in its membership, or in any other manner whatsoever, and that by - reason of such change, it is likely that the affairs of the company will be conducted in a manner prejudicial to the interests of the company; may apply to the court for an _o~r under this section provided such members have a right so to apply in virtue of section 399  - - - - b powers of central g01'emment 408 (1) notwithstanding anything contained in this act, the powers of central government may appoint not more than two persons to hold ~o;:e~~~dt office as directors thereof for such period, not exceeding three years opprcsfod on anyone occasion, as it may think fit, if the central government, ~nt on the application of not less than one hundred members of the company or of members of the company holding not less than one-tentli of the total voting power therein, is satisfied, after such inquiry as it deems fit ~o make, that it is necessary to make the ,appointment or appointments in order to prevent the affairs of the company i;>eing conducted either in a manner which is oppressive to any members of the company or in 8 manner which is prejudicial to 'the interests of the company: - - - provided that in lieu of passing an order as aforesaid, the central government may, if the company has not availed itself of the option given to it under section 265, direct the, company to amend its articles in the manner provided in that section and make fresh appointments of directors in pursuance of the articles as so amended, within such time as may be specified in that behalf by the central government  -  part xiii general - • - • delegation of powers and junctions of cemral government~e~gatio~ 637 (1) the central government may, by notification in the jov:~~ent official gazette, delegate any of its powers or functions under thjb ofjt~power8 act, other than those specified in sub-section (2), to such authority ~ron9 ':';ier or officer, and subject to such conditions, restrictions and limitations, act as may be specified in the notification (2) the central government shall not delegate its powers or functions under the following provisions of this act, namely, sections 10, 89 (4), 211 (3) and (4), 212, 213, 235, 237, 239, 241, 242, 243, 244, 245, 247, 248, 249, 250, 259, 268, 269, 274 (2), 295, 300, 310, 311, 324, 326, 328, 329, 332, 343, 345, 346, 347 (2), 349, 352, 369, 372, 396, 1399 (4) and (5), 401, 408, 409, 410, 411 fb), 448 609, 613, 620, 638, q641 and 642 ' - - - a biu further to amend the companies act, 1956 (shri t t ktishnamtjdjari, minister of findrtc,) 