Following
are the major initiatives and achievements of the Ministry of Corporate Affairs
in the last one year.
·
Furthering
ease of doing business - Companies Act, 2013:
o 16 amendments in the
Companies Act, 2013 approved by the Parliament – these amendments
are aimed at facilitating business and addressing concerns raised by
stakeholders. A summary of the amendments is enclosed at Annexure-1.
o A new integrated
e-Form INC-29 has been made available w.e.f 1st May, 2015 for
companies. The Form does away with filing multiple applications/forms saving
time and payable fees. Detail may be seen at Annexure-2.
o 24 amendments in
Rules under the Companies Act, 2013, 8 Removal of Difficulty Orders as well as many
clarifications were also issued.
o Certain prescribed
forms were discontinued or merged with existing forms. Other Forms were also
simplified.
·
Setting
up of a Committee to look into further modifications required in the Companies
Act, 2013.
o A broad based
Committee consisting of representatives of the Institute of Company Secretaries
of India, the Institute of Chartered Accountants of India or some industry chambers
and from the Ministry is being constituted to look into requirement for further
changes in the Companies Act, 2013.
·
Notification
of Indian Accounting Standards (Ind AS):
o Consequent to
announcement in the budget of Financial Year 2014-15 (para 128), accounting
standards converged with global standards, namely, International Financial
Reporting Standards (IFRS) were framed in consultation with the Institute of
Chartered Accountants of India and National Advisory Committee on Accounting
Standards. These thirty nine standards, called Indian Accounting standards
(Ind AS) have been notified on 16.02.2015 as Companies (Indian Accounting
Standards) Rules, 2015. These accounting standards are significantly congruent
with the global standards, with minimum carve-outs and are expected to boost
investor confidence.
·
Constitution
of NCLT and NCLAT
o The Constitution
Bench delivered its final order on the long standing litigation. The
constitution of the NCLT is being taken up in an expeditious manner.
*****
DSM/KA
ANNEXURE 1
Companies (Amendment) Bill, 2015
SUMMARY OF AMENDMENTS AND THE
OFFICIAL AMENDMENTS
1.
Omitting requirement for minimum paid up share capital, and
consequential changes. (For ease of doing business) -[section 2(68)/2(71)
of the Companies Act, 2013 (Act)].
2.
Making common seal optional, and consequential changes for
authorization for execution of documents. (For ease of doing business) -[sections
9, 12, 22, 46 and 223 of the Act].
3. Doing
away with the requirement for filing a declaration by a company before
commencement of business or exercising its borrowing powers. (For ease of
doing business) -[Omission of section 11 of the Act and consequential
change in section 248]
4.
Prescribing specific punishment for deposits accepted under the new Act. To
deal with defaults in repayment of depositor. (For protection of depositors'
interests) – [New Section 76A of the Act]
5.
Prohibiting public inspection of Board resolutions filed in the Registry. (To
provide for confidentiality of commercial interests discussed in resolutions)
-[section 117(3) of the Act].
6.
Including provision for setting off past losses/depreciation before declaring
dividend for the year- (Standard prudential clause).[ section 123(1) of
the Act]
7.
Rectifying the requirement of transferring equity shares for which unclaimed/
unpaid dividend has been transferred to the Investor
Education and Protection Fund (IEPF) even though subsequent dividend(s) has
been claimed -[section 124(6) of the Act].
8.
Enabling provisions to prescribe thresholds beyond which fraud shall be
reported to the Central Government (below the threshold, it will be reported to
the Audit Committee/ Board). Disclosures for the latter category also to be
made in the Board’s Report. [ section 143(12) and 134(3) of the Act].
9.
Empowering Audit Committee to give omnibus approvals for related party
transactions on annual basis. (Align with SEBI policy and increase ease of
doing business)– [section 177(4) of the Act].
10.
Exemption u/s 185 (Loans to Directors) provided for loans to wholly owned
subsidiaries and guarantees/securities on loans taken from banks by
subsidiaries. (This was provided under the Rules but being included in the Act
as a matter of abundant caution).[ section 185(1) of the Act].
11.
Replacing ‘special resolution’ with ‘resolution’ for approval of related party
transactions by non-related shareholders. (Balance the process for majority
supported genuine commercial decisions) -[section 188(1) of the Act].
12.
Related party transactions between holding companies and wholly owned
subsidiaries exempted from the requirement of approval of non-related
shareholders. -[section 188(1) of the Act].
13.
Bail restrictions to apply only for offences relating to fraud u/s 447. [section
212(6) of the Act].
14.
Winding up cases to be heard by 2-member Bench instead of a 3-member Bench. - [section
419 of the Act].
15.
Special Courts to try only those offences carrying imprisonment of two years or
more. (Rationalization of jurisdiction, to let magistrates try minor
violations, with the objective of speeding up disposal).[section 435 and
436 of the Act].
16. Rationalizing
the procedure for laying draft notifications granting exemptions to various
classes of companies or modifying provisions of the Act in Parliament, in order
to ensure speedier issue of final notifications. (For a faster process of
giving exemptions to classes of companies). [section 462 of the Act].
****
ANNEXURE
2
NEW FORM
INC-29
1)
The integrated e-Form INC-29 is available with effect from
01.05.2015 for One Person Company, Private Company, Public Company and Producer
Company.
2)
INC-29 does away with filing of multiple applications/forms saving
time and payable fees. It combines the processes relating to:-
i.
Allotment
of Director Identification Number (DIN) (up to three Directors),
ii.
Incorporation
of a company, and
iii.
Appointment
of first Directors of the company.
3)
The
new e-Form does away with the need for reserving a name for the company prior
to applying for its incorporation.
4)
Declarations are in-built in the e-Form. Separate attachments
containing such declarations are not required.
5)
The e-Form is enabled for future integration with e-Biz platform
of DIPP for generating applications for PAN, ESIC and EPFO numbers on the
platform and therefore provide a single interface for these applications also.
*****
DSM/KA