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Saturday, 22 September 2018

Government Company : Companies Act 2013

Government Company Sec 2(45) of Companies Act 2013

Government company as per companies act 2013
Government Companies

According to section 2(45) of Companies act 2013, Government Company is a company in which at least 51℅ paid-up share capital is held by

     Central Government or
     State Government or
     Central government and state government jointly 

If any company is a subsidiary of a government company then such subsidiary company shall be considered a government company.

Although there is pervasive control of the government, Government Company is neither a government department nor a government establishment. According to this employees of a government company shall not be considered as civil servants.

Employees of the Government Company cannot claim government for their salaries and pay scale. It is the prime duty of only Government Company to pay salaries to its employees. It was decided in the case, Click to read A.K. Bindal v. Union of India (2003) 114 Com Cases 590 (SC).

Government Company shall operate according to companies act 2013 but central government has power under section 462(1) to issue notification that

     Any of the provisions of Companies act 2013 shall not apply to such class of companies  or

     Any of the provisions of Companies act 2013 shall apply to such class of companies with exceptions, modifications and adaptations as may be specified in the notification.

In this regard central government has been notified some provisions vide notification no 463(E) dated 5th June, 2015 which shall not apply or shall apply with exceptions, modifications and adaptations to government companies. 
Click here to know about exemptions -  Notification 463(E) for Government Companies

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