Companies Act Section 393 — Company’s failure to comply with provisions of this Chapter not to affect validity of contracts, etc

CHAPTER XXII COMPANIES INCORPORATED OUTSIDE INDIA

Commercial / Corporate

Summary

If a company fails to follow the rules in this Chapter, that failure does not make any contract, deal, or transaction it entered into invalid, and it does not stop the company from being sued over that contract, deal, or transaction.

However, until the company has complied with the provisions of this Act that apply to it, the company is not allowed to start a lawsuit, claim a set-off, make a counter-claim, or begin any legal proceeding in relation to that contract, deal, or transaction.

Official Text

Any failure by a company to comply with the provisions of this Chapter shall not affect the validity of any contract, dealing or transaction entered into by the company or its liability to be sued in respect thereof, but the company shall not be entitled to bring any suit, claim any set-off, make any counter-claim or institute any legal proceeding in respect of any such contract, dealing or transaction, until the company has complied with the provisions of this Act applicable to it.