Companies Act, 2013 (Act) was notified on 29th August, 2013.
The government has moved amendments to the Companies Act in the Lok Sabha. The bill seeks to amend seven key provisions. Finance Minister Arun Jaitley said, “After a detailed consideration, some minor amendments are required in the principal act. Now, most of them are indented for one purpose – the ease of doing business and in some cases, they were oversight which were left out. Now it is only to rectify those and in rectification of those mistakes provision in the Bill itself. The advice of the law ministry was that these changes could not be covered and therefore, these small consequential amendments have arisen because of that.” As a part of the amendments, related party transactions (RPT) are set to get simpler, as companies will only need an ordinary resolution and not a special resolution. In addition, auditors will have to report on fraud to the government, which are only above a particular threshold. Any fraud below the threshold can be reported only to the audit committee of the company. The threshold will depend on profit or turnover of the company. Meanwhile, the government is also looking to strengthen the National Companies Law Tribunal to speed up winding up of companies. These will be the key changes to the Companies Act