Law and accounts

1. When the signature of the subscibers to memorandum of association has been forged, is a certificate of incorporation issued by the registrar valid?

ANS : NO
2. According 2 revised schedule 6 should the entity provide for proposed dividend?

ANS:NO, as per instruction to rev sch vi it shuld not.

1. When the signature of the subscibers to memorandum of association has been forged, is a certificate of incorporation issued by the registrar valid?

ANS : NO
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  Section 35 of the Act states that the certificate, once issued, is conclusive evidence of the fact that “all the requirements of this Act have been complied with in respect of registration” and that the company is duly registered.
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The words “conclusive evidence” are important. They imply that the Registrar of Companies has examined the documents submitted to him, and the certificate is proof of that.
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Once the certificate of incorporation has been granted, the regularity of incorporation cannot be questioned on any grounds whatsoever. In Peel’s case the court refused to consider that any irregularity had been committed prior to the registration of the company and Lord Cairns observed, “…once the certificate of incorporation is given, nothing is to be inquired into as to the regularity of the prior proceedings.”
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Hence, it may rightly be said that the certificate of incorporation is a conclusive evidence of the company’s existence even if the signatures on the memorandum of association are forged. The company’s position is firmly established and can be terminated not by assailing its incorporation, but only by resorting to the provisions of enactments that provide for winding up of companies.
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Though six out of seven signatures to the Memorandum of Association of a company were forged, the company was registered and the Certificate of Incorporation was issued. Can the registration of the company be challenged subsequently on the ground of forged signatures? (CA PE-II, May 2007)  
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2. According 2 revised schedule 6 should the entity provide for proposed dividend?

ANS:NO, as per instruction to rev sch vi it shuld not.
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Companies should continue to create a Provision for Dividends in respect of the period covered by the Financial Statements and disclose the same as a Provision in the B/Sheet, unless AS–4 is revised. So, Proposed Dividend shall be shown as an –

> Appropriation Items under Reserves and Surplus,

> Provisions in the Balance Sheet,

> Disclosure in the Notes on Accounts.

Accounting Standards will prevail over the Revised Schedule VI.
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Refer to Para 8.8.7.7 of Guidance Note on Revised Schedule VI issued by ICAI.