Can I be arrested for non-payment of a personal loan in India? No, simple inability to repay a personal loan cannot result in arrest. Loan defaults are civil matters, not criminal cases under Indian law. However, if fraud was involved when obtaining the loan, criminal charges might apply

Send a legal notice to the illegal occupant demanding they vacate the premises. - Lodge FIR under IPC sections related to trespass and intimidation. - File a suit for possession, injunction, or eviction depending on the nature of occupancy. - If police do not take action, file a private complaint under CrPC

Managerial remuneration under Indian corporate law is regulated primarily by the **Companies Act, 2013**, along with the rules and schedules prescribed under it. The law sets limits on the amount of remuneration that can be paid to **directors, managing directors, whole-time directors, and managers** of a company, especially in public companies, to ensure fairness, transparency, and protection of shareholder interests.

The key provisions are laid out in **Section 197** of the Act, and **Schedule V** provides detailed guidelines for companies that have inadequate or no profits.

In a financial year, the **total managerial remuneration** payable by a public company to its directors, including managing director and whole-time director, and its manager, **shall not exceed 11%** of the **net profits** of the company, calculated as per Section 198 of the Act. However, this limit can be exceeded with the approval of shareholders through a **special resolution** and subject to compliance with Schedule V.

There are further caps within this overall limit:

* **Managing director or whole-time director or manager**: remuneration shall not exceed **5%** of the net profits, if there is only one such person.
* If there is more than one such director or manager, the remuneration shall not exceed **10%** of net profits to all such persons combined.
* **Non-executive directors**, including independent directors, may be paid remuneration not exceeding **1%** of net profits if there is a managing or whole-time director, or **3%** if there is none.

In case a company has **no profits or inadequate profits**, remuneration can be paid in accordance with **Schedule V**, which specifies the maximum limits based on the company’s effective capital. If a company wishes to pay beyond these limits, it must obtain **Central Government approval**.

All payments must be approved by the **board of directors**, and in most cases, also by the **shareholders** in a general meeting. Detailed **disclosure requirements** regarding managerial remuneration are also enforced in the annual financial statements and board reports.

These regulations aim to prevent excessive payouts, ensure accountability, and align the interests of management with the long-term goals of the company and its stakeholders.

**Independent directors** are members of a company’s board who do not have any direct or material relationship with the company, its promoters, or its management that may affect their ability to make unbiased decisions. Their role is to provide an objective and impartial perspective in boardroom discussions and corporate governance.

According to the Companies Act, 2013, an independent director must not be a promoter or related to promoters or directors of the company, must not have any pecuniary relationship with the company apart from receiving director’s remuneration, and should not have been an employee or key managerial personnel of the company in the recent past. The law mandates the appointment of a certain number of independent directors, especially in listed companies and large public companies.

Independent directors are important for several reasons. They enhance the credibility and transparency of the board's decision-making by bringing in an outside and neutral viewpoint. They help protect the interests of minority shareholders and ensure that the board acts in the best interest of the company as a whole, rather than being influenced by internal interests or promoters.

They also play a crucial role in committees like the audit committee, nomination and remuneration committee, and risk management committee, where unbiased oversight is essential. By acting as watchdogs over management decisions, independent directors help strengthen investor confidence, ensure regulatory compliance, and support ethical corporate governance.

Their presence contributes significantly to balancing power within the board, improving accountability, and promoting long-term sustainability of the company.

Under the Companies Act, 2013, the directors of a company are entrusted with significant responsibilities to ensure good governance, legal compliance, and protection of the interests of stakeholders. Their duties are both statutory and fiduciary in nature and are clearly outlined in **Section 166** of the Act. The key duties of a director include the following:

A director must act **in accordance with the articles of association** of the company. They are bound to operate within the framework laid out in the company’s internal rules and cannot act beyond the powers given to them.

Directors have a duty to act **in good faith**, in order to promote the objectives of the company for the benefit of its members as a whole. They must also consider the interests of employees, shareholders, the community, and the environment while making decisions.

They are required to act with **due care, skill, and diligence** and exercise **independent judgment** in the performance of their functions. This means directors must make informed decisions and not merely rely on others’ opinions or act under influence.

A director must **avoid situations involving direct or indirect conflicts of interest** with the company. If any conflict arises, it must be disclosed fully and honestly.

They should **not gain any undue advantage** or profit for themselves or others through their position. If a director is found to have obtained any unfair gain, he or she may be liable to pay an equivalent amount back to the company.

A director must **not assign his office** to another person. Such an assignment is void, as the position of a director is based on personal trust and responsibility.

In case of a **breach of these duties**, the director can be held liable and may face penalties, including fines and disqualification. The Companies Act, 2013 emphasizes transparency, accountability, and ethical conduct, making directors central to the health and governance of the company.

The **Memorandum of Association (MoA)** is a fundamental legal document required for the incorporation of a company under the Companies Act, 2013. It defines the **constitution, scope, and powers** of the company and sets out the framework within which the company can operate. The MoA acts as a **charter of the company**, establishing its relationship with the outside world by specifying its objectives and limitations.

The MoA contains the following **six main clauses**:

1. **Name Clause**: This states the name of the company. For a private limited company, the name must end with “Private Limited,” and for a public limited company, it must end with “Limited.” The name must not be identical or similar to an existing company or trademark.

2. **Registered Office Clause**: It mentions the name of the state in which the company’s registered office will be situated. This determines the jurisdiction of the Registrar of Companies (ROC) under which the company will fall.

3. **Objects Clause**: This is one of the most important clauses. It specifies the **main objectives** for which the company is formed and also lists **ancillary or incidental objects** that support the main business. A company can only engage in activities mentioned in this clause.

4. **Liability Clause**: This clause defines the liability of the members. It states whether the liability of the members is limited by shares or by guarantee, or is unlimited.

5. **Capital Clause**: It states the **authorized share capital** of the company and how it is divided into shares of a fixed amount. It also mentions the types of shares and their value.

6. **Subscriber Clause**: This contains the details of the subscribers (initial shareholders) who agree to form the company and take up the shares. It includes their names, addresses, occupations, number of shares subscribed, and their signatures.

The MoA is a **public document**, and any person dealing with the company is presumed to have knowledge of its contents. It cannot be altered easily and any change in its clauses generally requires special procedures, including approval from the shareholders and, in some cases, the government.

The incorporation of a company under the Companies Act, 2013 involves several stages that ensure the company is legally formed and recognized as a separate legal entity. These stages are as follows:

The first stage is the **promotion** of the company. This involves the initial planning and decision-making by the promoters, who take the initiative to set up the business. They identify the business opportunity, gather resources, choose the type of company, and make arrangements for its formation.

The next stage is the **name approval**. An application must be submitted to the Ministry of Corporate Affairs (MCA) for reserving the company’s name through the RUN (Reserve Unique Name) service or during the SPICe+ (Simplified Proforma for Incorporating Company Electronically Plus) application process. The proposed name should comply with the naming guidelines and must not be identical or similar to any existing company or trademark.

Following name approval, the **preparation and filing of incorporation documents** takes place. This includes drafting the Memorandum of Association (MOA) and Articles of Association (AOA), which define the company’s objectives and rules of operation. Other necessary documents, such as the declaration by directors, proof of registered office, identity and address proofs of subscribers, and the consent of directors, must also be prepared.

All these documents are then submitted online through the **SPICe+ form** on the MCA portal. This integrated form allows for multiple services such as DIN (Director Identification Number) allotment, PAN and TAN application, EPFO and ESIC registration, and GST registration.

Once the Registrar of Companies (ROC) examines and verifies the documents and is satisfied with the application, the **Certificate of Incorporation (COI)** is issued. This certificate acts as conclusive proof of the existence of the company. It includes the Corporate Identity Number (CIN), date of incorporation, and the name of the company.

After incorporation, the company must fulfill post-incorporation requirements such as opening a bank account, issuing shares to subscribers, and filing declarations for commencement of business.

These stages ensure that the company is legally registered and ready to operate within the framework of Indian corporate laws.

A One Person Company (OPC) is a unique concept introduced under the Companies Act, 2013, to encourage individual entrepreneurs to enter the corporate framework. As the name suggests, an OPC is a company that can be formed with just one person as its sole member and shareholder. Unlike a sole proprietorship, which is not a separate legal entity, an OPC enjoys a distinct legal identity, limited liability, and perpetual succession.

The concept is significant because it provides a simple and structured way for a single individual to operate a business with the benefits of a company. It reduces the burden of compliance compared to private or public companies and is especially beneficial for startups and small entrepreneurs who wish to avoid the complexities of having multiple promoters or shareholders. The limited liability protection ensures that the personal assets of the individual are not at risk in case of business losses or debts.

Additionally, the OPC structure allows access to funding, credibility, and legal recognition while retaining full control in the hands of the single owner. It serves as a bridge between a sole proprietorship and a full-fledged private limited company, making it a valuable tool for fostering entrepreneurship in India.

Under the Companies Act, 2013, a company is recognized as a legal entity distinct from its members. One of its most significant features is that it enjoys a separate legal identity, meaning it can own property, enter into contracts, sue, and be sued in its own name. Another key characteristic is limited liability, where the liability of the shareholders is restricted to the amount unpaid on their shares, protecting their personal assets.

A company also enjoys perpetual succession, meaning its existence is not affected by the death, insolvency, or resignation of its members; it continues to exist irrespective of changes in ownership or management. It owns its property independently, and the shareholders have no direct rights over the company’s assets.

Shares of a public company are freely transferable, allowing shareholders to transfer ownership without affecting the company’s existence. While the use of a common seal has become optional under the 2013 Act, it still acts as an official signature if adopted by the company.

Being an artificial legal person created by law, a company cannot act on its own and must operate through human agents like directors and officers. It is governed by a detailed legal and regulatory framework that includes maintaining statutory records, holding meetings, filing returns, and complying with audit requirements. These features collectively define the structure and identity of a company under the Act.

Before serving notice to the government or a public authority in a Public Interest Litigation (PIL), the petitioner must ensure that the issue raised genuinely concerns public interest and not personal gain. The petition should be carefully drafted with proper facts, legal grounds, and supporting documents, and filed under Article 226 in the High Court or Article 32 in the Supreme Court. In some cases, court rules or practices may require the petitioner to serve an advance copy of the petition to the concerned authority. However, formal notice to the government or public authority is issued only after the court has reviewed the petition and found it fit for admission.