Section 391(2) closure of place of business by a Foreign Company.-(General Circular No. 01/2017)

General Circular No. 01/2017

F. No. 1/23/2013-CL-V

Government of India

Ministry of Corporate Affairs 

"A" Wing, 5th Floor, Shastri Bhawan

Dr. R.P. Road, New Delhi 110001

Date: 22nd February, 2017

To

All Regional Directors, 

All Registrar of Companies,

All Stakeholders

Sub: Section 391(2) closure of place of business by a Foreign Company.

Sir,

Sub-Section (2) of Section 391 of the Companies Act, 2013, states that the provisions of Chapter XX shall apply mutatis mutandis for closure of the place of business of a foreign company in India as if it were a company incorporated in India.

These provisions have been brought into force on 15th December, 2016. Stakeholders have sought clarification with regard to scope of application of the said sub-section.

2. The matter has been examined in the Ministry and it has been noted that subsection (1) and sub-section (2) of section 391 needs to be read harmoniously. Accordingly, it is clarified that provisions of sub-section (2) of Section 391 of the Companies Act, 2013 would apply only in case of a foreign company which has issued prospectus or IDRs pursuant to provisions of Chapter XXII of Companies Act, 2013.

3. This issues with the approval of Competent Authority.

Yours faithfully.

(Sudhir Kapoor)

Deputy Director

Copy to:

1. Guard File

2. E-Governance Section and Web Contents Manager to place this circular on the Ministry website.