ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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From 50 Years Ago: The Corporate Sector.

Official Papers from Volume XIII, No. 15, April 15, 1961. 

The Corporate Sector When the Companies Bill was being debated in Parliament in 1955 and earlier, several mem-bers were keen to know if the Bill was to be one of the instruments for achieving a socialist pattern of society. The then Finance Minister, Shri Chintaman Deshmukh, replied that the Bill was concerned merely with codifying and improving Company Law and practices and that the achievement of a socialist pattern of society depended upon other instruments. The Companies Act [1956], in other words, was looked upon as an instrument of correction and regulation mainly through disclosure of certain essential information and prior approval from [the] Government for certain contracts. ...[T]he Act has succeeded in eliminating some malpractices in corporate management. Most abuse of corporate management arises, however, not so much out of the desire to evade the Companies Act as to avoid or evade taxa-tion. So long as avoidance or evasion of taxes continues to be widespread, and what is worse, no social opprobrium attaches to such practices and known tax-evaders are openly patronised by Government in various ways, the abuses of corporate management are bound to remain and continue to flourish. The more serious of these abuses occur in, or through companies which are not public companies. Under the present provisions of the Companies Act, the Department of Company Law Administration cannot gener-ally take action against them on the ground that public interest is involved.

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