Brief bullet points on Companies (Amendment) Bill, 2020, As introduced in Lok Sabha on 17th March 2020
- This is 4th amendment after 2015,2017 & 2019.
- 66 sections has been proposed to be Amended.
- Out of 66 amendments, 45 amendments are for Di-criminalization of penalty provisions as companies act is a civil law . Some penalty has been removed, Many places Imprisonment has been replaced with penalty, some areas the penalty /fine has been reduced.
- A new section 129A has been inserted
- Amendment made in section 62,135,149,197
- Rest in most of the sections, the penalty provisions is amended .
- Separate Chapter on 'Producer Company' is proposed to be introduced in the Act.
- Setting up of Benches of the National Company Law Appellate Tribunal (NCLAT),
- Relaxing the provisions relating to charging of higher additional fees for default on 2 or more occasions in submitting, filing, registering or recording any document, fact or information as provided in section 403 of the Act;
|
Section |
Old Provisions |
New /Amended Provisions |
Remarks |
|
62 |
Minimum time period of 15 days for subscribe to Right issue (Issue open time ) |
Now this 15 days will be reduced . The word “or such lesser number of days as may be prescribed" shall be inserted . |
This will help the company close the period at the early once all the shares are subscribed and speed up the process. |
|
129A |
New Section |
|
This is like and at par with Listed companies as per LODR. MCA will bring some private companies as well based on TO/Paid up share capital within this new provisions to track & monitor them. |
|
135 |
New set off provisions and no requirement to constitute CSR committee |
|
This is a new provisions to give a relief to a company who spends more amount voluntarily . The provision of transfer of unspent amount is yet to be effective .(section 135-6) |
|
149 |
Independent Director gets sitting Fees and profit related commission . |
Now Independent Director will gets remuneration evenif there is no profit /inadequate profit as per Sch V apart from sitting fees . |
This is a good move since there is stringent compliance for Independent Director , they should be treated at par with other Managerial Persons |
|
197 |
Payment of Remuneration only to MD, WTD or MGR in case there is no profit or inadequate profit as per SCH-V |
Now this privilege of payment of remuneration during the No profit /inadequate profit also to cover “ Non –Executive Directors & Independent Directors as well. |
This is a good move by MCA since Other directors are also part of the management team . This will enhance the productivity of such non-executive directors because of their increased remuneration . |
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