Incorporation of a Public Bank

8/8/2019 Incorporation of a Public Bank

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TOPIC: INCORPORATION OF A PUBLIC BANK

M.B.A

Term Paper

2009-2010

MGT-518

Submitted by Guided by

Chandan kumar singh Miss.Maneet Kaur

Section-RT-1902(B)

Roll number A-27

Regi no-10903162

Lovely Professional university


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INDEX

Acknowledgement.

Objective andAIM

Introduction

Conclusion.

Bibliography.

Acknowledgement

I provide full justice to this term paper which is prepared by visiting

various web-sites, magazines, articles etc.

An interesting part of this term paper is research methodology which is

prepared with the help of the formation of a new company.

I would like to take an opportunity to thank all the people in collecting the

necessary information and making of the report. I am grateful to all of

them for their time and wisdom.

My project becomes a reality only due to cooperation of many people who

had helped me in completing this project. I sincerely extend my gratitude

to Mis. MANEET KAUR who has given me this precious opportunity to

have an know about our Indian. And how we start of a new bank in India.


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T E R M P A P E R

CORPORATE BUSINESS LAW

INCORPORATION OF A PUBLIC BANK

INTRODUCTION

A company is an association of a number of persons, formed for some common purpose

and registered according to the law relating to companies. Section 3(1)(i) of the Companies Act,

1956 states that a company means, a company formed and registered under this Act or an

existing company.

According to Lord Justice Lindley, By a company is meant an association of many

persons who contribute money or moneys worth to a common stock and employ it for a

common purpose. The common stock so contributed is denoted in money and is the capital of

the company. The person who contribute it or to whom it belongs are members. The

proportion of capital to which each member is entitled is his share.

A company, formed and registered under the Company Act, is regarded by law as a

single person, having specified rights and obligations. The law confers on a company a distinct

legal personality, with perpetual succession and a common seal.

OBJECTIVE OF THIS PAPER

The objective of this paper is to grasp, assimilate and comprehend the application of the

Corporate Business Law being practiced and its impact on day to day operations of the Business

in respect of the Contract act.


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In this paper we will discuss how to start a new public bank limited company

hypothetically specifying its name, registration procedure in detail, the objectives, and legal

formalities of the forming a company. According to the nature of the business, we will also

have to make an offer and enter into different contracts with any 2 other groups through

invitation following all the essential elements as stipulated under the contract act 1872.

THE ESSENTIAL STEPS FOR THE FORMATION OF A COMPANY

Before a company can be formed the following steps must be taken:

1. The Memo and the Article must be prepared. These two documents must be filed when the

application is made for the registration and incorporation of the company. The Companies Act

lays down rules regarding the preparation of the memorandum. Schedule I to the Act of 1956contains four model forms for use in different cases.

2. If it is proposed to have a paid up capital of more than Rs 3 crores, sanction of the central

Government must be obtained under the capital issue (Control) Act, 1956.

3. If the company to be formed intends to participate in an industry which is included in the

scheduled annexed to the industries (Development and Regulation) Act, 1951, a license must be

obtained under the Act.

4. The company must be registered in accordance with the provision of the companies Act , 1956

and a certificate of incorporation must be obtained.

5. The prospectus or the statement in lieu of prospectus must be issued and registered with the

registrar.

6. The minimum subscription must be raised and therefore the allotment of shares must be made.7. The certificate for the commencement of business must be obtained from the Registrar.

PROCEDURE OF REGISTRATION

For the registration of a company, the following documents, together with the necessary fees,

must be submitted to the registrar of companies of the state in which the registered office of the

company will be situated-Sec 33.

1. Memorandum of Association, prepared in accordance with provision of the Companies Act, and

signed by the least 7 persons in the case of public companies and 2 persons in the case of

private companies.

2. The Articles of Association, in case of unlimited companies, companies limited by guarantee and

private companies limited by shares.

3. A declaration by any of the following persons, stating that all the requirements of the act have

been compiled with an advocate, an attorney a pleader, a chartered accountant, or a person

named in the articles as director, manager, or secretary of the company.


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4. The duly signed list of persons have consented to be directors of the company, their consent in

writing and the signed agreement with every such director to take the number of shares

required to qualify as directors of the company. These are not required in the case of private

companies and the companies not having a share capital.

5. The registration fees of a company is fixed on the graduated scale on the amount of nominal

capital or the number of members. There is also a filing fee per document.If the Registrar is satisfied that all the required documents of the act have been

compiled with, he will register the company and issue a certificate called the Certificate of

Incorporation.

MEMORANDUM OF ASSOCIATION

1.Name Clause: Indian Urban Bank Limited.

2.Registered Office Clause: Gobershai, Muzaffarpur, Bihar

3.Object Clause:

i) Main Object: Banking

ii) Other Objects: Mutual fund and Insurance.

4.Area ofOperation Clause: Meghalaya, Assam, West Bengal,

Bihar, Madhya Pradesh, Delhi, Punjab, Jammu and Kashmir,

Uttar Pradesh, Orissa, Karnataka, Tamil Nadu, Kerala.

5.Liability Clause: Limited by Shares.

6.CapitalClause: Rs 1000, 000,000(Rupees One Hundred

Crore Only.)

7.Association and Subscription Clause :


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ARTICLES OF ASSOCIATION

SHARE CAPITAL AND INCREASE AND REDUCTION OF CAPITAL

The Authorized Share Capital of the company is Rs. 100,00,00,000 (Rupees One hundredCrore only) divided into 10,00,00,000 (Ten Crore) Equity Shares of Rs. 10 each (Rupees tenonly) with powers to increase or reduce the same in accordance with the provisions of the

Companies Act, 1956.

Increase of capital of the companyThe Company in General Meeting, may from time to time, increase its capital by the creation ofnew shares, such increase to be of such aggregate amount and to be divided into shares of such

amounts as the resolution shall prescribe.

Allotment otherwise than for cashSubject to the provisions of the Act and these Articles, the Directors may allot and issue shares in

the capital of the Company as payment or part-payment for any property or assets of any kindwhatsoever, sold or to be sold or transferred or to be transferred or for goods or machinerysupplied or to be supplied or for services rendered or to be

rendered or for technical assistance or know-how made or to be made available to the Companyor the conduct of its business and shares which may be so allotted may be issued as fully or

partly paid-up otherwise than in cash and if so issued, shall be deemed to be fully or partly paidas the case may be.

Additional capital to form part of existing capitalExcept so far as otherwise provided by the conditions of issue or by these presents, any capital

raised by the creation of new shares, shall be considered as part of the existing capital.

Redeemable preference shares

Subject to the provisions of Section 80 of the Act, the Company shall have the power to issuePreferential Shareswhich are or at the option of the Company are to be liable to be redeemed and the resolution

authorising such issueshall prescribe the manner, terms and conditions of redemption.

Reduction of capitalThe Company may (subject to the provisions of Sections 78, 80, 100 to 105 inclusive, of the Act)from time to time by Special Resolution, reduce its capital and any Capital Redemption Reserve

Account or Share Premium Account in any manner for the time being authorised by law, and inparticular, capital may be paid off on the footing that it may be called up again or otherwise

SHARES ANDCERTIFICATESShares to be numbered progressively and no Shares are to be sub-divided. The shares in the

capital shall be numbered progressively according to their several denominations and except in

the manner hereinbefore mentioned no share shall be sub-divided.


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Shares at the disposal of the Directors: Subject to the provisions of these Articles and the Act,

the shares in the capital of the Company for the time being (including any shares forming part of

any increased capital of the Company) shall be under the control of the Directors who may

issue, allot or otherwise dispose of the same or any one of them to such persons in such

proportion and on such terms and conditions. The shares can be issued at a discount and at

such times as they may from time to time think fit and proper and with the sanction of theCompany in General Meeting to give to any person the option to call for or allotted shares of anyclass of the Company either at par or at premium or subject as aforesaid at a discount during such

time and for such consideration and such option being exercisable at such times as the Directorsthink fit; and any shares which may be so allotted may be issued as fully paid-up shares and if so

issued shall be deemed to be fully paid-up shares. The Board shall cause to be filed the returns asto allotment provided for in Section 75 of the Act. Provided that the option or right to call of

shares shall not be given to any person except with the sanction of the company in the GeneralMeeting.

Acceptance of shares

Any application signed by, or on behalf of, an applicant for shares in the Company followed byan allotment of any shares therein, shall be an acceptance of shares within the meaning of theseArticles; and every person who thus or otherwise accepts any shares and whose name is entered

in its Register of Members shall, for the purpose of these Articles, be a member of the Company.

Share CertificateThe share certificates shall be issued in market lots and where share certificates are issued in

either more or less than market lots, sub- division or consolidation of share certificates intomarket lots shall be done free of charge.

Directors may sign a share certificate by affixing their signature thereon by means of anymachine, equipment or other mechanical means, such as engraving in metal or lithography, but

not by means of a rubber stamp, provided that the Director shall be responsible for the safecustody of such machine, equipment or other material used for the purpose.

Renewal of share certificateNo fee shall be charged for issue of new share certificates in replacement of those which are old,decrepit, worn out. If a share certificate is lost or destroyed, a new certificate in lieu thereof shall

be issued only with the prior consent of the Board and on payment of such fee, not exceedingRupees two as the Board may from time to time fix, and on such terms, if any, as to evidence

and indemnity as to payment of such out-of-pocket expenses incurred by the Company ininvestigating evidence, as the Board thinks fit. When a new share certificate has been issued in

pursuance of Clause (c) of this Article, it shall state on the face of it and against the stub orcounterfoil to the effect that it is a duplicate issued in lieu of share certificate No_________.

The word duplicate shall be stamped or punched in bold letters across the face of the sharecertificate.

CALLSDirectors may from time to time, subject to the terms on which any shares may have been issuedand subject to the conditions of allotment, by a resolution passed at a meeting of the Board (andnot by circular resolution) make such calls as it thinks fit upon the Members in respect of all

monies unpaid on the shares held by them respectively and each member shall pay the amount of


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every call so made on him to the person or persons and at the time and place appointed by theBoard. A call may be made payable by installments.

Notice of callsThirty days notice in writing of any call shall be given by the Company specifying the time and

place of payment, and the person or persons to whom such calls shall be made.

Calls to date from resolution.A call shall be deemed to have been made at the time when the resolution authorising such callwas passed at ameeting of the Board.

Call may be revokedA call may be revoked or postponed at the discretion of the Board.

Proof on trial or suit for money on shares

On the trial or hearing of any action or suit brought by the Company against any member or hislegal representativeto recover any moneys claimed to be due to the company for any call orother sum in respect of his shares, it shall be sufficient to prove:

a) that the name of the Member, in respect of whose shares the money is ought to be recovered,appears entered

in the Register of Members as the holder or one of the holders, at or subsequent to the date atwhich the money

sought to be recovered is alleged to have become due, on the said shares andb) that the resolution making the call is duly recorded in the minutes books.

FORFEITURE AND SURRENDER OF AND LIEN ON SHARES

If money payable on share not paid notice to be given to Members.If any Member fails to pay any call or installment of call on or before the day appointed for the

payment of the same or any such extension thereof as aforesaid, the Board may, at any timethereafter, during such time as the call or installment remains unpaid, give notice to him

requiring him to pay the same together with any interest that may have accrued and all expensesthat may have been incurred by the Company by reason of such non-payment.

Terms of noticeThe notice shall name a day (not being earlier than the expiry of fourteen days from the date ofservice of notice) and a place or places on and at which such call or installment and such interest

thereon at such rate as the Directors shall determine from the day on which such call or

installment ought to have been paid and expenses as aforesaid are to be paid. The notice shallalso state that, in the event of the non-payment at or before the time and the place appointed, theshare in respect of which the call was made or installment is payable will be liable to be

forfeited:


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Notice of forfeitureWhen any share shall have been so forfeited, notice of the forfeiture shall be given to the

Member in whose name it stood immediately prior to the forfeiture or to any of his legalrepresentatives, or to any of the persons entitled to the shares by transmission and an entry of the

forfeiture, with the date thereof, shall forthwith be made in the Register of Members but no

forfeiture, shall be in any manner invalidated by any omission or neglect to give such notice or tomake such entry as aforesaid. Forfeited shares to become property of the Company and may be

sold, etc.Any share so forfeited shall be deemed to be the property of the Company and may besold, re-allotted or otherwise disposed of, either to the original holder thereof or to any otherperson, upon such terms and in such manner as the Board shall think fit.

Members still liable to pay money due notwithstanding the forfeiture

Any member whose shares have been forfeited shall, notwithstanding the forfeiture, be liable topay, and shall forthwith pay to the Company on demand all calls, amounts, instalments, interest

and expenses owing upon or in respect of such shares at the time of the forfeiture, together with

interest thereon from the time of the forfeiture until payment, at such rate as the Board maydetermine and the Board may enforce the payment thereof if it thinks fit.

Effect of forfeitureThe forfeiture of a share shall involve extinction, at the time of the forfeiture, of all interest in and of all

claims and demands against the Company, in respect of the share, and all other rights incidental to theshare, except only such of those rights as by these Articles are expressly saved.

Surrender of sharesThe Directors may subject to the provisions of the Act, accept a surrender of any shares from or by any

member

Desirous of surrendering them on such terms as they think fit.

Cancellation of share certificate in respect of forfeited sharesUpon any sale, re-allotment or other disposal under the provisions of the preceding Articles, the

certificate or certificates originally issued in respect of the relative shares shall (unless the same shall on

demand by the Company have been previously surrendered to it by the defaulting Member) standcancelled and become null and void and of no effect, and the Directors shall be entitled to issue a new

certificate or certificates in respect of the said shares to the person or persons entitled thereto.

TRANSFER AND TRANSMISSION OF SHARES

Register of Transfers

The company shall keep a Register of Transfers and shall have recorded therein fairly and distinctlyparticulars of every transfer or transmission of any share held in material form.

Form of transferShares in the Company shall be transferred by an instrument in writing in such form as prescribed underSection 108 of the Companies Act, 1956, or under rules made there under from time to time.

To be executed by Transferor and Transferee


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The instrument of transfer duly stamped and executed by the transferor and the transferee shall be

delivered to the Company in accordance with the provisions of the Act. The instrument of transfer shallbe accompanied by such evidence as the Board may require proving the title of the transferor and his right

to transfer the shares and every registered instrument of transfer shall remain in the custody of theCompany until destroyed by an order of the Board. The transferor shall be deemed to be the holder of

such shares until the name of the transferee shall have been entered in the Register of Members in respect

thereof. Before the registration of a transfer, the certificate or certificates of the shares must be deliveredto the Company.

Title to shares of deceased MemberThe executors or administrators or holders of a Succession Certificate or the legal representatives of a

deceased member shall be the only person recognized by the Company as having any title to the sharesregistered in the name of such Member, and the Company shall not be bound to recognize such executors

or administrators or holders of a Succession Certificate or the legal representatives unless such executorsor administrators or legal representatives shall have first obtained Probate or Letter of Administration orSuccession Certificate, as the case may be, from a duly constituted court in the Union of India provided

that in case where the Board in its absolute discretion think fit, the Board may dispense with production

of Probate or Letters of Administration or Succession Certificate, upon such terms as to indemnity or

otherwise as the Board in its absolute discretion may think necessary and under Article 59 register thename of any person who claims to be absolutely entitled to shares standing in the name of a deceased

Member, as a Member.

BORROWING POWERS

Power to BorrowSubject to the provisions of Sections 58A, 292 and 293 of the Act and of these Articles, the Board may,

from time to time at its discretion, by a resolution passed at a Meeting of the Board accept deposits fromMembers, either in advance of call or otherwise, and generally raise or borrow or secure the payment of

any sum or sums of money for the purposes of the company provided however, where the moneys to beborrowed together with the moneys already borrowed exceed the aggregate of the paid up capital of the

Company and its free reserves the Board shall not borrow such moneys without the consent of theCompany in General Meeting.

The payment or repayment of borrowed moneyThe payment or repayment of moneys borrowed as aforesaid may be secured in such manner and uponsuch terms and conditions in all respects as the Board may think fit.

Terms of issue of debenturesAny debentures, debenture-stock or other securities may be issued at a discount, premium or otherwiseand maybe issued on condition that they or any part of them shall be convertible into shares of anydenomination, and with any privileges and conditions as to redemption, surrender, drawing, allotment of

shares and attending General Meetings, appointment of Directors and otherwise. Debentures with a right

to conversion or allotment of shares shall be issued only with the consent of the Company in GeneralMeeting.

SHARE WARRANTPower to issue share warrants

The Company may issue share warrants subject to, and in accordance with the provisions of sections 114

and 115, and accordingly the Board may in its discretion, with respect to any share which is fully paid-up

on application in writing signed by the persons registered as holder of the share, and authenticated, bysuch evidence (if any) as the Board may, from time to time, require as to the identity of the person signing


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the application, and on receiving the certificate (if any) of the share, and the amount of the stamp duty on

the warrant and such fee as the Board may from time to time require, issue a share warrant.

Deposit of share warrant

The bearer of a share warrant may at any time deposit the warrant at the office of the Company, and solong asthe warrant remains so deposited, the depositor shall have the same right of signing a requisitionfor calling a meeting of the Company, and of attending, and voting and exercising the other privileges of aMember at anymeeting held after the expiry of two clear days from the time of deposit as if his namewere inserted in theRegister of Members as the holder of the share included in the deposited warrant.The bearer of a share warrant shall be entitled in all other respects to the same privileges and advantages

as if he was named in the Register of Members as the holder of the share included in the warrant, and

shall be a Member of the Company.

Issue of new Share Warrant or CouponThe Board may, from time to time, make rules as to the terms on which (if it shall think fit) a new sharewarrant or coupon may be issued by way of renewal in case of defacement, loss or destruction.

CONVERSION OF SHARE INTO STOCK AND RECONVERSION

Shares may be converted into stockThe Company in General Meeting may convert any paid-up shares into stock; and when any shares have

been converted into stock, the several holders of such stock may thenceforth transfer their respective

interest therein, or any part of such interest, in the said manner and subject to the same Regulations as,and subject to which shares from which the stock arose might have been transferred if no such conversion

had taken place, or as near thereto as circumstance will admit. The Company may at any time reconvert

any stock into paid-up shares of any denomination.

Right of stockholdersThe holders of stock shall, according to the amount of stock held by them, have the same rights,

privileges and advantages as regards dividends, voting at meetings of the Company, and other matters, asif they held the shares from which the stock arose, but no such privilege advantage (except participationin the dividends and profits of the Company and in the assets on winding-up) shall be conferred by an

amount of stock which would not, if existing in shares, have conferred that privilege or advantage.

MEMBERS MEETINGS

Annual General MeetingAnnual General Meeting of the company may be convened subject to Section 166 and Section 210 of the

Act bygiving not less than 21 days notice in writing. Subject to the provisions of Section 171 (2) a meeting may

be convened after giving a shorter notice.

Extra ordinary General MeetingThe Board may, whenever it thinks fit, call an Extraordinary General Meeting and it shall do so upon a

requisition in writing by any Member or Members holding in the aggregate not less than one tenth of suchof the paid-up capital; as at that date carried the right of voting in regard to the matter in respect of whichthe requisition has been made.


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Quorum at General Meeting:Five members present in person shall be a quorum for a General Meeting.A body corporate being a member shall be deemed to be personally present if it is represented in

accordance with Section 187 of the Act.If, at the expiration of half an hour from the time appointed for holding a meeting of the Company, aquorum shall not be present, the meeting it convened by or upon the requisition of Members, shall stand

dissolved, but in any other case the meeting shall stand adjourned to the same day in the next week or ifthat day is a public holiday until the next succeeding day which is not a public holiday at the same timeand place or to such other day at such other time and place within the city or town in which the Office ofthe Company is situate as the Board may determine, and if at such adjourned meeting a quorum is not

present at the expiration of half an hour from the time appointed for holding the meeting, the Members

present shall be a quorum, and may transact, the business for which the meeting was called.The Chairman (if any) of the Directors shall be entitled to take the chair at every General Meeting,

whether Annual or Extraordinary. If there be no such Chairman of the Directors, or if at any meeting heshall not be present within fifteen minutes of the time appointed for holding such meeting then themembers present shall elect another Director as Chairman and if no Director be present or if all Directors

present decline to take the Chair, then the members present shall elect one of their members to be the

Chairman.

Question at General Meeting how decidedAt any General Meeting a resolution put to the vote of the meeting shall be decided on a show of hands

unless a poll is (before or on the declaration of the result of the show of hands) demanded by a member ormembers present in person or by proxy and holding shares in the Company

Number of votes to which member entitledSubject to the provisions of these Articles and without prejudice to any special privileges or restrictions as

to voting for the time being attached to any class of shares for the time being forming part of the capital of

the Company, every member, not disqualified by the last preceding Article shall be entitled to be presentand to speak and vote at such meeting, and on a show of hands every member present in person shall have

one vote and upon a poll the voting rights of every member whether present in person or by proxy, shall

be in proportion to his share of the paid-up equity capital of the Company.

DIRECTORSNumber of DirectorsUntil otherwise determined by the company in a General Meeting and subject to the provisions of Section

252 of the Act, the number of directors (excluding Debenture Directors and Directors appointed underArticle 111 hereof and Alternate Directors) shall not be less than three nor more than Eighteen.The Board may appoint, from time to time, one or more of their members to be the Managing Director or

JointManaging Director or Wholetime Director or Deputy Managing Director or Manager of the Company on

such terms and on such remuneration whether by way of salary or commission, or partly in one and partly

in another as they may think fit

Appointment of special DirectorsOn behalf of the Company, whenever Directors enter into a contract with any Government, Central, Stateor Local, any Bank or Financial institution or any person or persons (hereinafter referred to as the

appointer) for borrowing any money or for providing any guarantee or security or for technicalcollaboration or assistance or for underwriting or entering into any other arrangement whatsoever the

Directors shall have, subject to the provisions of Section 255 of the Act, the power to agree that suchappointer shall have right to appoint or nominate by notice in writing addressed to the Company one or


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more Directors on the Board for such period and upon such conditions as may be mentioned in the

agreement and that such Director or Directors may not be liable to retire by rotation nor be required tohold any qualification shares. The Directors may also agree that any such Director or Directors may be

removed from time to time by the appointer entitled to appoint or nominate them and the appointer mayappoint another or others in his or their place and also fill in any vacancy which may occur as a result of

any such Director or Directors ceasing to hold that office for any reason whatsoever. The Directors

appointed or nominated under this Article shall be entitled to exercise and enjoy all or any of the rightsand privileges exercised and enjoyed by the Directors of the Company including payment of remunerationand travelling expenses to such Director or Directors as may be agreed by the Company with theappointer.

Removal of Directors:The Company may (subject to the provisions of Section 284 of the Act) remove any Director before the

expiration of his period of office and appoint another person in his stead.

PROCEEDINGS OF THE BOARD OF DIRECTORS

Meeting of DirectorsThe Directors may meet together as a Board for the dispatch of business from time to time and shall so

meet at least once in every three calendar months and at least four such meetings shall be held in everyyear. The Directors may adjourn and otherwise regulate their meetings as they may think fit.

Notice of Board MeetingsNotice of every meeting of the Board shall be given in writing to every Director for the time being in

India and at his address in India to every other Director.

QuorumSubject to Section 287 of the Act, the quorum for a meeting of the Board shall be one-third of its totalstrength(excluding Directors, if any, whose places may be vacant at the time. and any fraction contained in that

one-third being rounded off as one), or two Directors whichever is higher. Provided that where at any

time the number of interested Directors exceeds or is equal to two- thirds of the total strength, the numberof the remaining Directors, that is to say, the number of the Directors who are not interested present at themeeting being not less than two, shall be the quorum during such meeting.

Powers of DirectorsThe business of the Company shall be managed by the Board of Directors, who may exercise all such

powers of the Company and do all such acts and things as are not, by the Act, or any other Act or by theMemorandum or by the Articles of the Company required to be exercised by the Company in GeneralMeeting, subject nevertheless to the Regulations of these Articles to the provisions of the Act, or any

other Act and to such Regulations being not inconsistent with the aforesaid Regulations or provisions as

may be prescribed by the Company in General Meeting but no Regulation made by the Company in

General Meeting shall invalidate any prior act of the Board which would have been valid if thatRegulation had not been made.

Division of profitsThe profits of the Company, subject to any special rights relating thereto created or authorised to becreated by these Articles, shall be divisible among the Members in proportion to the amount of capital

paid-up or credited as paid-up and to the period during the year for which the capital is paid-up on theshares held by them respectively.


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The Company in general meeting may declare dividendsSubject to the provisions of Section 205 of the Companies Act, 1956 the Company in General Meeting

may declare dividends, to be paid to its Members according to their respective rights but no dividendsshall exceed the amount recommended by the Board, but the Company in General Meeting may declare asmaller dividend.

Interim DividendThe Board may, from time to time, pay to the members such interim dividend as in their judgement the

position of the Company justifies.

Capital paid-up in advance carrying interest not to earn dividendWhere capital is paid in advance of calls, such capital may carry interest but shall not be in respect thereofconfer a right to dividend or participate in profits.

Dividend to be paid pro-rata

Subject to the rights of persons, if any, entitled to shares with special rights as to dividends, all dividendsshall be declared and paid according to the amounts paid or credited as paid on the shares in respectwhereof dividend is paid.

Retention of Dividends until completion of transfer under Article 62The Board may retain the dividends payable upon shares in respect of which any person is, under Article

62 entitled to become a Member, which any person under that Article is entitled to transfer, until suchperson shall become a member in respect of such shares or shall duly transfer the same.

Board ReportThere shall be attached to every such balance sheet a report of the Board as to the state of the Companys

affairs and as to the amounts, if any, which it proposes to carry to any reserves in such balance sheet andthe amount, if any, which it recommends should be paid by way of dividend; and material changes andcommitments, if any, affecting the financial position of the Company which have occurred between the

end of the financial year of the company to which the balance sheet relates and the date of the report. The

Boards report shall so far as is material for the appreciation of the state of the Companys affairs by itsmembers and will not in the Boards opinion be harmful to the business of the company or any of its

subsidiaries, deal with any changes which have occurred during the financial year in the nature of theCompanys business, in the Companys subsidiaries or in the nature of the business carried on by them

and generally in the classes of business in which the company has an interest and any other information asmay be required by Section 217 of the Act. The Board shall also give the fullest information and

explanations in its report aforesaid or in an addendum to that report, on every reservation, qualification oradverse remark contained in the auditors report. The Boards report and any addendum thereto shall be

signed by its Chairman if he is authorized in that behalf by the Board; and when he is not so authorised,shall be signed by not less than two Directors.

.

WINDING UPDistribution of AssetsThe Liquidator on any winding up (whether voluntary and supervision or compulsory) may with the

sanction of a Special Resolution, but subject to the rights attached to any preference share capital, divideamong the contributories in specie any part of the assets of the Company and may, with the like sanction,


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vest any part of the assets of the Company in trustees upon such trusts for the benefit of the contributors,

as the liquidator, with the like sanction shall think fit.

Registration with the Registrar of Companies toget the bank incorporated

1. SELECTION OF A NAME:We have to select, in order of preference, at least one suitable name upto a

maximum of six names, indicative of the main objects of the company. The following are

the names which we want to name our bank:

1. Indian Urban Bank Limited.2.National Urban Bank Limited.

3.Urban Bank of India Limited.4.Royal Bank of India Limited.5.Royal Urban Bank of India Limited.6.Royal Urban Bank Limited.

We have to ensure that the name does not resemble the name of any other alreadyregistered bank or company and also does not violate the provisions of emblems and

names (Prevention of Improper Use Act, 1950) by availing the services of checking nameavailability on the portal.

2. APPLICATIONOFTHENAME:

We have to apply to the concerned RoC to ascertain the availability of name ineForm1A[Pursuant to sections 20 and 21 of the Companies Act, 1956] by logging in to

the portal. A fee of Rs. 500/- has to be paid alongside and the digital signature of theapplicant proposing the company has to be attached in the form. If proposed name is not

available, the user has apply for a fresh name on the same application. Form 1A isattached and filled.

3. GRANTINGOFTHENAME BY THER.O.C.:

The first name, i.e. Indian Urban Bank Limited is assumed to have been selected andthe letter of incorporation has been received.4

4. FILLINGOFTHEFORMTOGETTHECOMPANY REGISTERED:


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The form is filled giving the following information:

A. The application is for incorporating of a new bankingcompany, The Indian Urban Bank Limited.

B. The proposed company is a Public company.

C. The Category of the Proposed company is a companylimited by shares.D. The company is having Share Capital.E. The state will be registered in the state ofMeghalaya.F. The number of promoters is 7.G. The main object of the company is Banking.H. Proposed authorized capital is Rs 1000,000,000 (One

Hundred Crore Only)

Along with the form we have to arrange for the drafting of the memorandum and articlesof association by the solicitors, vetting of the same by RoC and printing of the same. The

memorandum and article must be arranged for stamping of the memorandum and articleswith the appropriate stamp duty.

We have to get the Memorandum and the Articles signed by at least two subscribers inown hand, father's name, occupation, address and the number of shares subscribed for

and witnessed by at least one person.

We have to ensure that the Memorandum and Article is dated on a date after the date ofstamping.

Login to the portal and fill the following forms and attach the mandatory documents

listed in the eForm

Declaration of compliance - Form-1Notice of situation of registered office of the company - Form-18.

Particulars of the Director's, Manager or Secretary - Form-32.

We have to submit the following eForms after attaching the digital signature, pay the

requisite filing and registration fees and send the physical copy of Memorandum andArticle of Association to the RoC

After processing of the Form is complete and Corporate Identity is generated obtain

Certificate of Incorporation from RoC.

ADDITIONAL STEPS T O BE T A KEN F OR F ORMATION OF A PUBL IC L IMITED C O MPANY:To obtain Commencement of Business Certificate after incorporation of the companythe public company has to make following compliance


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File a declaration in eForm 20 and attach the statement in lieu of the prospectus(scheduleIII) OR

File a declaration in eForm 19 and attach the prospectus (Schedule II) to it.

Obtain the Certificate of Commencement of Business.

RERGISTRAR OF COMPANIES

C E R T I F I C A T E O F C O M M E N C E M E N T O F

B U S I N E S S

This is to certify that The IndianUrban Bank Limited filed for incorporation

was granted on the 30th

November 2009. This proved that the company has

performed all the requirements and fulfilled the legal procedures of the

incorporation of the company and all the documents were found legal and

satisfactory. From this day forward the company is capable of undertaking its

normal business operation.

C O N T RA C T

This is to certify that The Indian Urban Bank Limited has given a loan to Gandhi Telecom Limited,

a sum of Rs 20,00000.00 (Rupees Twenty Lakhs) at a 9.5 % interest on the 2nd

November, 2009.

Royal . Vincent. Sham. Sunder.

Managing Director Managing Director

Indian Urban Bank Ltd Gandhi Telecom Limited


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FORM NO. 1

Registration No. of Company .......... Nominal Capital : Rs.

................

THE COMPANIES ACT, 1956

Declaration of compliance with the requirements of the Companies Act, 1956 on

application for registration of a company

[Pursuant to section 33(2)]

Name of Company Limited/Private Limited

Presented by..

I, ., of do solemnly and

sincerely

Declare that I am [1] who is engaged in the formation of the

company, or a person

Named in the articles as a director/manager/secretary of the

Limited/Private

Limited.

And that all the requirements of the Companies Act, 1956, and the rules thereunder in

respect of matters precedent to the registration of the said company and incidental

thereto have been complied with.


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And make this solemn declaration conscientiously believing the same to be

true.

Date

Place Signature

Witness

Designation

1. An advocate of the Supreme Court of the ...................... High Court, an attorney or apleader entitled to appear before the ........................... High Court or a charteredaccountant practising in India.

2. State whether director, manager / secretary /advocate/ chartered account.

FORM NO. 18

Registration No. of the Company Nominal Capital: Rs


Notice ofthe situation/change ofsituation ofregistered office

[pursuant to section 146]

Name of the company

Notice is hereby given that ----

1. (a) the registered office of the company is situated .with effect from

[date]


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(b) the situation of the registered office of the company of was changed from to

with effect form .

[date]

2. Situation of registered office falls under the jurisdiction of

(name of the police station).*Dated this Day of 19

Signature

Name

(In Block Capitals)

Designation

*State address of nearest police station with district and tehsil.

FORM NO29

Registration No. of Company ........................ Nominal Capital Rs. ...................................


Consent to act as director ofa company and/or undertaking to take and pay for qualification shares

[pursuant to section 264(2)/266(I)(a) and 266(1)(b)(iii)]

Name of company .............................................. Limited ..........................................

Presented by ..................................................................................................................

To the Registrar of Companies .......................................................................

I, the undersigned, hereby testify my consent to act as director of the .......................... limited,

................................ pursuant to section 264(2)/266(1)(a) of the Companies Act, 1956 and certify that Ihave not been disqualified to act as a director under sections 267 and/or 274 of the Companies Act,

1956.

I, the undersigned having consented to act as director of the .............................. Limited, also

hereby undertake to take from the said company and pay for .................... shares of Rs. . ................ each,

being the number/value of the shares prescribed as the qualification shares for the office of director of

the said company.


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Name and

surname in full

and fathers

names

Address Occupation Date of birth Nationality Signature

1 2 3 4 5 6

Signature ..............................

Designation ...........................

Dated the ........................... day of .................... 19

Notes: (1) Delete the portion not applicable.

(2) If a director signs through his agent authorised in writing, the authority must be produced

before the Registrar.

(3) In case of undertaking to take and pay for qualification shares, the from should be

accompanied by the necessary stamp duty.

FORM NO. 32

Registration No. of Company .......................... Nominal Capital Rs. ...................................


Particulars ofappointment ofdirectors and manager and changes among them

[Pursuant to section 303(2)]

Name of Company ......................................... Presented by ...............................................

Note : --- If a company has no particulars to be included in one or two of the headings A B and

C the parts containing those headings (in respect of which the company has no particulars to beincluded) need not be filed.

A. Appointment of and changes among directors.

Name or

names and

surname in

Fathers/

husbands

Usual

residential

Nationality Date of

appointment

Brief

particulars of


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full name address or change changes

1 2 3 4 5 6

Notes: (1) A note of changes should be made in column 6 e.g. by inserting against the name of new

director, etc. the words in place of ........................ and by indicating against the name of the

former director, the cause for the change, e.g. by death, resignation, retirement by rotation,

disqualification etc.

(2) In case of managing director, his designation should be stated with his name in columan1.

B. [***]

C. Appointment of and changes in managership and secretaryship.

Name or

names and

surname in

full

Fathers/

husbands

name

Usual

residential

address

Nationality Date of

appointment

or change

Brief

particulars of

changes

1 2 3 4 5 6

Dated the .......................................... day of ..............19

Signature ............................................

Designation............................................

Notes: (1) For the purposes of this form, particulars of a person appointed as manager within the

meaning of section 2(24) of the Companies Act, 1956 need be given.

(2) A note of change as also the cause of change e,g, by death, resignation, removal,

disqualification, etc. should be stated in column 6.


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Conclusion:when we study to how to start or procedure to start a new bank in India. We very

well know about the our country law and rule or relegation. India is a big develop

country and every person wants to start a business in India . so it is the procedure

to start a bank in India.

Bibliography.

Books:-Mercantile law (ND kapoor)

Mercatile law (KC gerg)

Company law (Avatar singh)

Websiteswww.britannica.com/EBchecked/topic/86266/business-law

www.jstor.org/stable/4503875www.mca.gov.in

www.indialegalservice.com

www.indiagoverment.in


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Incorporation of a Public Bank

Documents

Transcript of Incorporation of a Public Bank