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CMA Foundation · Fundamentals of Business Laws and Business Communication · Primary and Subordinate Legislation

The Companies Act, 2013 empowers the Central Government to frame the Companies (Incorporation) Rules. These Rules are best classified as:

The Rules are subordinate legislation because they are framed by the Central Government under authority delegated by the Companies Act, 2013. Gazette publication does not turn them into primary legislation, and they must stay within the limits set by the parent Act.

  1. APrimary legislation, because they are published in the Gazette
  2. BSubordinate legislation, because they are made under power delegated by the ActCorrect
  3. CA constitutional amendment, because the Centre made them
  4. DCustomary law, because companies follow them in practice

Explanation

Rules made by the Government under authority conferred by a parent Act are delegated or subordinate legislation. Publication in the Gazette does not make them primary; they must remain within the scope of the parent Act and can be struck down if they exceed it.

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