CS Divesh Goyal
SHORT SUMMARY
As per recent Notification on 19th August 2021, MCA has issued the Companies (Appointment and Qualification of Directors) Amendment Rules, 2021. These Rules came into effect from 20th August 2021.
Extract of Amendment
Amendment 1: in the first proviso, for clause (B), the following clause shall be substituted, namely:
'(B) in the pay scale of Director or equivalent or above in any Ministry or Department, of the Central Government or any State Government, and having experience in handling, —
(i) the matters relating to commerce, corporate affairs, finance, industry or public enterprises; or
(ii) the affairs related to Government companies or statutory corporations set up under an Act of
Parliament or any State Act and carrying on commercial activities.'.
Amendment 2: (ii) after the second proviso, the following proviso shall be inserted, namely:
'Provided also that the following individuals, who are or have been, for at least ten years:
(A) an advocate of a court; or
(B) in practice as a chartered accountant; or
(C) in practice as a cost accountant; or
(D) in practice as a company secretary,
shall not be required to pass the online proficiency self-assessment test.'.
List of People not required to pass the online proficiency test
An individual shall not be required to pass the online proficiency self-assessment test when he has served for a total period of not less than three years as on the date of inclusion of his name in the data bank as:
1. As a director or key managerial personnel, as on the date of inclusion of his name in the databank, in one or more of the following, namely:-
- listed public company; or
- unlisted public company having a paid-up share capital of rupees ten crore or more; or
- body corporate listed on any recognized stock exchange or in a country which is a member State of the Financial Action Task Force on Money Laundering and the regulator of the securities market in such member State is a member of the International Organization of Securities Commissions; or
- bodies corporate incorporated outside India having a paid-up share capital of US$ 2 million or more; or
- statutory corporations set up under an Act of Parliament or any State Legislature carrying on commercial activities; or
2. in the pay scale of Director or equivalent or above (i.e. not less than 3 years) in any Ministry or Department, of the Central Government or any State Government, and having experience in handling, —
- the matters relating to commerce, corporate affairs, finance, industry or public enterprises; or
- the affairs related to Government companies or statutory corporations set up under an Act of Parliament or any State Act and carrying on commercial activities.'.
3. in the pay scale of Chief General Manager or above in the Securities and Exchange Board or the Reserve Bank of India or the Insurance Regulatory and Exchange Board or the Reserve Bank of India or the Insurance Regulatory and Development Authority of India or the Pension Fund Regulatory and Development Authority and having experience in handling the matters relating to corporate laws or securities laws or economic laws.
4. Following individual having qualification for at least 10 years as
(A) an advocate of a court; or
(B) in practice as a chartered accountant; or
(C) in practice as a cost accountant; or
(D) in practice as a company secretary,
CONCLUSION
Above mentioned list of person on the basis of qualification and experience mentioned above are not required to pass Online Proficiency Test to get his/ her name register with Independent Director Data bank.
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