Teaching Company Law in Law Universities
- Prof. (Dr.) Vijay Kumar Singh, Dean, School of Law UPES University*
Corporate Law is often referred to as the ‘bread and butter’ subject for law students in NLUs. In fact, recently the Hon’ble Chief Justice of India while speaking at a convocation said “NLUs are seen as elitists and detached from social realities as most of the NLU graduates join corporate law firms instead of joining the ranks of lawyers practising in courts.”
However, same is not the situation on the other side of the classroom, as you don’t find enough teachers inclined to teach the subjects of corporate law. Reasons are plenty, however one of the most prominent ones is the complex and dynamic nature of the subject, which constantly keeps changing. A corporate law faculty needs to continuously update themselves with this dynamic change ushered in not only by legislature but also the notifications from the Ministry, judicial pronouncements through National Company Law Tribunal (NCLT), NCLAT (Appellate Tribunal), various High Courts and the Supreme Court of India.
The young generation of corporate law faculty is attuned to the Companies Act, 2013 and the recent Insolvency and Bankruptcy Code 2016, however, the major jurisprudence and case laws still lies under the Companies Act of 1956. Bar Council of India recommends ‘Company Law’ as one core paper to be taught in LLB Program, however, it is generally taught as two papers – Company Law I and II. In addition to this, many universities offer honours in ‘corporate law’ which is quite popular.
Corporate Law is a subject which cuts across many areas. Specialised areas like corporate restructuring, securities regulations, corporate insolvency, law for startups, etc. have emerged over the years into separate elective subjects in their own right. Focus of this Blog is teaching Company Law which essentially means the Companies Act and general principles of company law.
Understanding Business – A teacher of company law has to essentially fully understand the operations of a company starting from its pre-incorporation stage until its dissolution. I always ask my ‘competition law’ students to visit a market before I teach them ‘Porter’s five forces’. I had a good fortune of having witnessed the business operations from very close quarters at my father’s automobile shop in my childhood and later at the APMC Market Yard in Nagpur helping my uncle recover his investments from an ‘aadhati’ (commission agent) business, and now being part of the administration of a not-for-profit university. Understanding of business dynamics, relevance of profit for investors, role of business in society, and role of government machinery vis-à-vis sound business practices would help the faculty to nurture their thoughts better while delivering concepts in the class room. Imagine a faculty teaching about raising of capital without understanding how difficult it is to raise capital from public without an instrument of a ‘corporate form’.
Focus on the Basic Principles – The best approach in teaching company law is to align your lectures around the basic principles of company law. Beginning with the concept of ‘separate legal personality’ with the help of Solomon’s case, the jurisprudence around this concept shall be discussed in few lectures. This may also include the historical background of joint-stock companies, sole proprietorship and other forms of business, including the Hindu Undivided Family (HUF). This sets the context for teaching company law. Some other basic principles to be discussed in class should be (i) incorporation and its effect including the doctrine of constructive notice, doctrine of indoor management and lifting of corporate veil (ii) principles of raising of capital (iii) corporate governance principles which includes the interrelationship between the directors and the shareholders and not to forget the society at large (iv) oppression and mismanagement – protecting rights of minority shareholders (v) corporate dispute resolution (vi) corporate insolvency.
Focus on Learning the Procedure – In a company law class, it is not expected that a student shall become a Company Secretary, however, at least basic procedures shall be known to the students. For example the broad contents of the ‘constitutional documents’ of a company i.e. Memorandum of Association (MOA) and Articles of Association (AOA), relevance of shareholder’s meeting and director’s meeting, procedure involved in corporate insolvency, basics of mergers and amalgamation transactions, etc. This portion of company law teaching becomes a bit technical and dry and hence pedagogy is important. I generally follow the approach of involving students in group exercises to incorporate a company.
Touch base with Social Realities – Companies do not operate in vacuum, they are part and parcel of the society. It is important for a company law faculty to bring this integration very strongly. The concept of corporate liability (civil and criminal) shall be discussed at length. Few lectures shall be spent on the issues of companies’ contribution to the society in the form of CSR investments, corporate frauds and its impact, corporate corruption, and companies’ role in meeting the Sustainable Development Goals (SDGs).
The Regulator and the Tribunals – Company law teaching shall adequately deal with the regulator (the machinery of Registrar of Companies, Regional Director, SFIO etc. under the Ministry of Corporate Affairs) and the specialised tribunals i.e. the National Company Law Tribunal (NCLT) and Appellate Tribunal (NCLAT). Major case laws topic-wise shall be dealt with.
Pedagogy – In the past two years, the forced introduction of ‘online teaching’ into the pedagogy has introduced new possibilities of hybrid learning. The classrooms shall no more be utilised for transmitting information rather it shall be utilised to engage with the class. Faculty may use the ‘flipped classroom’ technique. It is a method wherein the students are asked to go through a concept by way of a reading or a video before coming to the class to discuss a live problem based on the concept. For example, a write-up or a small video on the types of companies may be provided to the students along with a problem to decide which one to go for to be discussed in the class under the supervision of the faculty mentor. Weaving anecdotes and stories into the concepts would make your lectures interesting and memorable for the students.
Teaching the students of Masters – In my experience of teaching one-year LLM for last few years, I found most of the students are not very clear on their Company Law subjects in undergraduate and hence things have to be repeated. Ideally, the teaching at master’s level shall involve debates beyond the basic concepts of company law. At the PG level, critical questions shall be deliberated about the efficacy of systems and procedures, for example, whether the Corporate Insolvency Resolution Process (CIRF) under the Insolvency and Bankruptcy Code (IBC) has served its purpose.
Teaching is a passion and one can contribute the best when they are engaged fully and think about their class like a movie director running the script. An advanced visualisation of the content, pedagogy and outcome is very important to teach company law effectively. It is very satisfying at the end of the day when your students turn to you and say ‘sir, we are grateful to you in lighting the spark for this subject’. I must say, there is an urgent need for more and more faculty showing interest in teaching corporate law subjects which has many takers now and there will be in future as well.
*Dr. Vijay Kumar Singh is a renowned professor of ‘Corporate Law’. Having worked with Competition Commission of India and the Indian Institute of Corporate Affairs, Dr. Singh blends his practical experience in his classroom. Visit for his https://papers.ssrn.com/sol3/cf_dev/AbsByAuth.cfm?per_id=1113018 writings.