A Question arises whether the powers of NCLT are more than the powers of a civil court?
The Answer to the above question is the powers of civil court have been kept at par with the powers of the NCLT, it is however debatable because under the company law a special court is appointed to adjudicate the matters relating to the companies and furthermore any appeal against the order of NCLT/NCLAT shall be filed in High Court, this automatically ousts the jurisdiction of civil courts over the matters relating to Companies.
How to exempt a Private company from CARO 2020?
Answer to the above question is
The Guidance note on CARO 2020 issued by ICAI states that a company which is covered under defination of 'Small Company' under section 2(85) is exempted from applicability of CARO.
The point to ponder is if a private company has a PSC 1 Crore or more; or borrowings exceeding 1 crore or Turnover exceeding 10 crore, should it be considered for applicability of CARO 2020? (By ignoring the fact that it is covered under the definition of Small company under section 2(85)).
The Answer is definitely 'NO'
Because the guidance note of CARO 2020 specifically states that a Company which is cover under definition of small company is completely exempted from the definition of CARO 2020, irrespective of the fact that it has PSC or borrowing or Turnover exceeding the general limits of CARO.
You have reached your daily limit of 2 Free Articles
Subscribe to CCI PRO for unlimited access
Why Upgrade to CCI PRO?
- No Ads
- WhatsApp Community
- Daily E-Newsletter
- Unlimited Articles Access
- Profile Visitors
- Link Social Profiles
- Featured Job Posts
- Pro Badge
- Expert GST Guidance
- Unlimited Forum Replies
- Download Content in PDF
Already a PRO member? Login here for an ad-free experience. 07941056694
CAclubindia
