Companies (Specification of Definition details) Amendment Rules 2021

Last updated: 03 February 2021

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The Ministry of Corporate Affairs has introduced the Companies (Specification of Definitions Details) Amendment Rules, 2021, effective from 1st April 2021. These rules amend the 2014 definitions for small companies. Specifically, the paid-up capital and turnover thresholds have been updated. For the purposes of sub-clauses (i) and (ii) of clause (85) of section 2 of the Act, a small company will now have a paid-up capital not exceeding two crore rupees and a turnover not exceeding twenty crore rupees.

MINISTRY OF CORPORATE AFFAIRS
NOTIFICATION
New Delhi, the 1st February, 2021

G.S.R. 92(E). - In exercise of the powers conferred by sub-sections (1) and (2) of section 469 of the Companies Act, 2013 (18 of 2013), the Central Government hereby makes the following rules further to amend the Companies (Specification of Definitions Details) Rules, 2014, namely: -

1. Short title and commencement: -

(1) These rules may be called the Companies (Specification of Definitions Details) Amendment Rules, 2021.
(2) They shall come into force on the 1st day April, 2021.

2. In the Companies (Specification of Definitions Details) Rules, 2014, in the rule 2, in sub-rule (1), after clause (s), the following clause shall be inserted, namely:-

“(t) For the purposes of sub-clause (i) and sub-clause (ii) of clause (85) of section 2 of the Act, paid up capital and
turnover of the small company shall not exceed rupees two crores and rupees twenty crores respectively.”.

[F. No. 1/13/2013 CL-V, Part I]
K. V. R. MURTY, Jt. Secy.

Note: The principal rules were published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 238(E), dated 31st March, 2014 and was last amended vide number G.S.R. 433(E) dated the 7th May, 2018

FAQ :

These are new rules introduced by the Ministry of Corporate Affairs to amend the existing Companies (Specification of Definitions Details) Rules, 2014, specifically concerning the definition of a 'small company'.

The Companies (Specification of Definitions Details) Amendment Rules, 2021, come into force on the 1st of April, 2021.

A small company will now have a paid-up capital not exceeding rupees two crores and a turnover not exceeding rupees twenty crores.

These changes relate to sub-clause (i) and sub-clause (ii) of clause (85) of section 2 of the Companies Act, 2013.

The provided notification does not specify the previous definition, only the updated thresholds.

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Notification No : F. No. 1/13/2013 CL-V, Part I
Published in Corporate Law
Source : http://www.mca.gov.in/Ministry/pdf/SpecificationAmndtRules_02022021.pdf

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