MCA Notifies 183 New Sections of Companies Act,2013 wef 1st April

MCA notifies 183 new sections of Companies Act 2013 in Phase IV

1) The Ministry of Corporate Affairs has notified 183 new sections of the Companies Act 2013 and some sub- sections of 13 sections which were already notified by notification dated 12th September 2013 and remaining schedule, in the fourth phase today, by way of notification dated 26th March 2014. 

2) These sections have been notified to come into effect from 1st April 2014. 

3) With the notification of these sections, now a total of 283 sections of the new Act stand notified.

4) With the notification of aforesaid sections, it can be assumed that relevant rules will also be notified shortly as most of them are dependent on rules.

5) The sections remaining to be notified are related to National Financial Reporting Authority, Investor and Education Protection Fund, Compromise and arrangement, oppression and mismanagement, winding up, sick companies ,special courts, national company law tribunal. Majority of these sections are not notified due to pending case in Supreme court with respect to the National Company Law Tribunal.

Status as on date:

The list of sections notified under Phase III along with title is given below:

Chapter 1 - Preliminary

• Section 2 – Definitions

• Clause (2) - Accounting Standards

• Clause (7) - Auditing Standards

• Clause (13) - Books of Accounts

• Clause (31) - Deposits

• Clause (41) - Financial year

• Clause (42) - Foreign company

• Clause (47) - Independent Director

• Clause (48) - Indian Depository Receipt

• Clause (62) - One Person Company

• Clause (83) - Serious Fraud Investigation Office

• Clause (85) - Small Company

• Explanation (d) of clause (87)

MCA issues clarification with regard to section 180 of the Companies Act, 2013.

MCA vide circular no 04/2014 dated 25th March 2014 has clarified that the resolution passed under section 293 (Restrictions on powers of Board ) of the Companies Act, 1956 prior to 12.09.2013 with reference to borrowings (subject to the limits prescribed) and / or creation of security on assets of the company will be regarded as sufficient compliance of the requirements of section 180 (Restrictions on powers of Board) of the Companies Act, 2013 for a period of one year from the date of notification of section 180 of the Act.

The clarification has been issued since Ministry has received many representations regarding various difficulties arising out of implementation of section 180 of the Companies Act, 2013 with reference to borrowings and/or creation of security, based on the basis of ordinary resolution.