Govt. constitutes Committee for further amending Companies Act, 2013
Gaurav Pingle
Practising Company Secretary | Consulting Editor | Author of Books on Related Party Transactions, Securities Laws | Faculty for Corporate Laws | Interests: ESG, Corp. Governance
The Govt. constituted Committee for examining & making recommendations on various provisions of Cos. Act. I really hope some meaningful amendments are introduced which have impact in day to day functioning and strategic-decision making of the company.
According to PIB Press Release, the Committee has been formed “In line with the Government’s objective of promoting Ease of Living in the country by providing Ease of Doing Business to law abiding corporates,…..” . The Committee needs to first define ‘ease of doing business’ & ‘ease of living’.
As a part of terms of reference of the Committee, reviewing LLP Act is quite interesting. Whether Committee aligns some provisions of Cos. Act with LLP is important? Whether restrictions are introduced on Cos. for transactions by LLP for inter-corporate deposit, transactions with related party, etc.?
NCLT can be further de-clogged, wherein Registrar of Cos. may initiate adjudication (by issuance of show cause notice) for some more non-compliances.
‘Settlement Mechanism’ & ‘Deferred Prosecution Agreement’ are quite sophisticated (proposed) provisions in Indian Company Law. Will be interesting to see the observations in Committee Report and whether such provisions would be part of Amendment Bill.
What actually needs to be addressed is: (i) Provisions of SBO, apparent conflict of Sec. 90 with SBO Rules, (ii) Schedule V, Part II – redrafting it or eliminating it, (iii) Easing compliances for Pvt. Placement of securities, (iv) Disclosure of interest by directors (Section 184 of Cos. Act, 2013) shall be aligned with Section 299 of Cos. Act, 1956, (v) Clarity on ‘ordinary course of business’ for RPTs, (vi) Guidance for ‘principal business activity’ for ‘loans to directors’, (vii) Clarity on exemptions to Pvt. Cos. (given by MCA by June 5, 2015 Notification read with Cos. (Amendment) Act, 2017 , (viii) Apparent conflict in Rules & Act, at several occasions.
-Gaurav Pingle, Practising Company Secretary.
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Diretore, divine justice law firm. India. Researchers in Crypto Cross Border, and C. B. D cs. DPDPA and GDPR. A I Regulatory. Bsc. ((Hon) L. LB., M. B. A. Block Chain, D. E. and B. L. ***********
5 年Carry on Dr.
Director at HRCare Foundation
5 年I thought the Companies' Act was amended recently. Why form committees and spend a lot when all you need is to hire an expert who can be paid to do such revisions on a time based project and the person made liable for any bad fallout from the amended Act.
Diretore, divine justice law firm. India. Researchers in Crypto Cross Border, and C. B. D cs. DPDPA and GDPR. A I Regulatory. Bsc. ((Hon) L. LB., M. B. A. Block Chain, D. E. and B. L. ***********
5 年Fantastic post!! Question roming in brain, can Govtvernment make ammendments at once? Consistency is required. Frequent ammendments makes it troublesome to keep track, so far Compliences concerned. Trial and error approach matter of concern.