Become a Govt. Certified GST Practitioner. Batch begins 18th Nov. Register Now!

Clause 49 of Listing Agreement

CA Prashant Gupta (DGM (F & A)) (14068 Points)

05 February 2010

Dear all

A company is listed since 1990. It share capital is 80 Lacs and net worth is about 10 crore.

My question is whether clause 49 of listing agreement is applicable on it.

by my point of view when revised clause 49 was inserted it was mentioned it will be applicable

on already listed companies if there share capital is more than 3 Crore and net worth more than 25 crore.

Please guide me.

Reply
Follow
Share

5 Replies

Jagruti (CS) (Service) (1953 Points)
Replied 06 February 2010

I think as on todays date is applicable to all listed Company irrespective of paid up capital or networth

Upgrade to CAclubindia Pro. Subscribe Now!

CS Ankur Srivastava (Company Secretary & Compliance Officer) (17853 Points)
Replied 06 February 2010

Dear Prashant,

SEBI vide its circular no. SEBI/CFD/DIL/2004/12/10 dated October 29, 2004 has directed amendment to Clause 49 of the Listing Agreement. The entire clause has been replaced.

Applicability:

The revised clause 49 shall apply to all the listed companies, in accordance with the schedule of implementation given in the revised clause 49. However for other listed entities, which are not companies, but body corporates (e.g. private and public sector banks, financial institutions, insurance companies etc.) incorporated under other statutes, the revised clause will apply to the extent that it does not violate their respective statutes, and guidelines or directives issued by the relevant regulatory authorities. The revised clause is not applicable to the Mutual Fund Schemes. Also the Stock Exchange shall ensure that a company seeking listing complies with Clause 49 before seeking in-principle approval for listing. The requirements of the revised Clause 49 shall be first applicable from the quarter ending June 2005.

CA Prashant Gupta (DGM (F & A)) (14068 Points)
Replied 07 February 2010

But Mr. Srivastava see the language "in accordance with the schedule of implementation given in the revised clause 49" what is schedule? if you see this the conditions which I mentioned in question is provided i.e. on already listed companies if there share capital is more than 3 Crore and net worth more than 25 crore

Avika, ACS (HR Legal and Management Consultant) (172 Points)
Replied 08 February 2010

As per my experience, Clause 49 is applicable to all the listed Companies, irrespective of their paid up capital or net worth, as it forms part of the Listing Agreement with the respective Stock Exchange.

CS Ankur Srivastava (Company Secretary & Compliance Officer) (17853 Points)
Replied 08 February 2010

Dear Prashant,

As your company is a existing listed company and paid up capital and turnover does not exceed Rs. 3 Crores Rs. 25 Crores respectively. Clause 49 does not apply in your case.

However, all new companies (i.e. listed after this notification) are required to comply with clause 49 of the listing agreement as per schedule of implementation.

Further, in good Corporate Governance your Company should also comply with Clause 49 of the Listing Agreement.