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The Central Government has amended Rule 84 of the National Company Law Tribunal Rules, 2016 to further specify the thresholds required for filing Class Action Suits.
The National Company Law Tribunal (Second Amendment) Rules, 2019 (Amendment Rules) have been notified by the Ministry of Corporate Affairs while exercising its powers under Section 469 of the Companies Act, 2013 (Act). The Amendment Rules came into force on May 8, 2019.
Rule 84 deals with the right to apply under Section 245 of the Act for Class Action Suits. Prior to the enforcement of the Amendment Rules, Rule 84 only provided for the requirement of filing Form NCLT-9 for filing an application and the requirement for serving of copies. While Section 245 in the Act stipulates the absolute number of members or depositors required for filing an application, the Amendment Rules fill the gap insofar as the percentage of members or depositors that is required.
The Amendment Rules provide specific percentage thresholds required for filing an application, in case of listed and unlisted companies. Pursuant to the amendment, the following sub-rules (3) and (4) have been inserted in Rule 84, after sub-rule (2):
“(3) In case of a company having a share capital, the requisite number of member or members to file an application under sub-section (1) of section 245 shall be –
(i) (a) at least five per cent. of the total number of members of the company; or
(b) one hundred members of the company, whichever is less; or
(ii) (a) member or members holding not less than five per cent. of the issued share capital of the company, in case of an unlisted company;
(b) member or members holding not less than two per cent. of the issued share capital of the company, in case of a listed company.
(4) The requisite number of depositor or depositors to file an application under sub-section (1) of section 245 shall be –
(i) (a) at least five per cent. of the total number of depositors of the company; or
(b) one hundred depositors of the company, whichever is less; or;
(ii) depositor or depositors to whom the company owes five per cent. of total deposits of the company.”
The amendment has also omitted serial No. 28 in the Schedule of Fees, which deals with the application for compounding of certain offences in terms of Section 441 of the Companies Act.
[Read the Amendment Notification]