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MISTAKES IN DRAFTING

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MISTAKES IN DRAFTING
By: Mr. M. GOVINDARAJAN
September 18, 2017
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Drafting

Drafting plays an important role in drafting the Act and the rules made there under.  Many of the provisions are made liable for interpretation.  Therefore the drafting is 100% perfect so that no ground leaves for misinterpretation.  The provisions of the Act are enacted by Parliament and State Legislature.   Maximum no mistake could be found in the provisions of the Act.  The rule making powers are given to the Government.  The Government officers/officials are preparing the draft for this purpose.  Many a mistake has been found now-a-days.  Even such mistakes have been unnoticed for a long period.  This will lead not only a problem to the stakeholder but also lead to litigations unnecessary.  Some examples are given in this article.

Regulation for Fast Track insolvency resolution process

Vide Notification No. IBBI/2017-18/GN/REG 012, dated 14.06.2017 the Insolvency and Bankruptcy Board made ‘the Insolvency and Bankruptcy Board of India (Fast Track Insolvency Resolution Process for Corporate Persons) Regulations, 2017 with effect from 14.06.2017.  But in the main heading it is shown as ‘Insolvency and Bankruptcy Board of India (Insolvency Resolution for Corporate Persons) Regulations, 2017.

The heading will create confusion since already there is a regulation entitled ‘Insolvency and Bankruptcy Board of India (Insolvency Resolution for Corporate Persons) Regulations, 2016.

Appeal under the Insolvency and Bankruptcy Code

Section 61(1) of the Code provides for filing appeal against the order of National Company Law Tribunal before the National Company Law Appellate Tribunal.  Section 61 (2) provides – Every appeal under sub-section (1) shall be filed within thirty days before the National Company Law Appellate Tribunal.

The rule fails to provide the computation of thirty days either it is from the date of order or from the date of receipt of the order of the Tribunal.  It is made to be clear.

Form GST REG -13

Vide Notification No.22/2017-Central tax, dated 17.08.2017 the Central Government substituted Form GST REG -13 which is an application/form for grant of Unique Identity Number (UIN) to UN Bodies/Embassies/others.  In Part B of the form after serial no. 4, serial no. 7 is found.  What happened to serial number 5 and 6?  Whether it is a clerical mistake? Or Serial No. 5 and 6 are missing.  The Central Government is to clear this situation.

The said notification is the Central Goods and Services Tax (Fifth Amendment) Rules, 2017.  Clause 2(v) of the said Rules provides that – “in rule 61, with effect from 1st day of July, 2017, in sub-rule (5) for the words ‘specify that’ the words ‘specify the manner and conditions subject to which the’ shall be substituted.

Rule 61(5) is produced as below-

 (5) Where the time limit for furnishing of details in Form GSTR – 1 under section 37 and in Form GSTR – 2 under section 38 has been extended and the circumstances so warrant, return in Form GSTR – 3B, in lieu of Form GSTR – 3, may be furnished in such manner and subject to such conditions as may be notified by the government.

In the said rule there is no word as notified ‘specify that’.  Whether the rule number has wrongly been noted in the notification?  It is not known.

NCLT Rules

The heading for Part – I of the National Company Law Tribunal Rules, 2016 is given as ‘Definitions, forms and etc’, which express no meaning.  This error has been rectified in the Notification No. GST 716 (E), dated 21.07.2016 vide clause 2 and corrected as ‘Definitions and forms etc.,’.

Part XX of National Company Law Tribunal Rules, 2016 (notified vide Notification No. GST 716 (E), dated 21.07.2016)provides schedule of fees.  Sl. No. 10 of the Schedule provides as below-

Sl. No. 9

Section of the Companies Act, 201373(4)

Nature of application/parties – Application by deposition for payment of deposit or interest

Fees – ₹ 500/-

Actually the term ‘depositor’ is to be used but the term ‘deposition’ has been provided.  This error has been corrected only vide Notification No. GST 1159 (E), dated 20.12.2016 vide clause 15 of the National Company Law Tribunal (Amendment) Rules, 2016.

IBBI (Voluntary liquidation process) Regulations, 2017

Regulation 5(2) provides that the resolution passed under regulation 3(2) (c) or under section 59(3)(c), as the case may be, shall contain the terms and conditions of the appointment of the liquidator, including the remuneration payable to him.

There is no sub clause for Regulation 3(2).  Regulation 3(1) has only three sub clauses.  Instead of indicating Regulation 3(1) (c), regulation 3(2) (c) is indicated.  There is no rectification of this mistake till date.

 

By: Mr. M. GOVINDARAJAN - September 18, 2017

 

Discussions to this article

 

Very nice article. Hats off to your writing skills.

By: Ganeshan Kalyani
Dated: 22/09/2017

In respect of mistake pointed out for Regulation for Fast Track Regulation Process, the Insolvency and Bankruptcy Board of India has brought out amendment vide Notification No. IBBI/2017-18/GN/REG017, dated 05.10.2017 and made the correct version.

By: MARIAPPAN GOVINDARAJAN
Dated: 09/10/2017

 

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