Companies Act 2013
|Companies Act 2013|
|An Act to consolidate and amend the law relating to companies.|
|Citation||Act No. 18 of 2013|
|Enacted by||Parliament of India|
|Date assented to||29 August 2013|
|Date signed||29 August 2013|
12 September 2013 (98 sections)
|Bill||The Companies Bill, 2012|
|Bill citation||Bill No. 121-C of 2011|
|The Companies Act 1956|
|Status: In force|
The Companies Act 2013 is an Act of the Parliament of India on Indian company law which regulates incorporation of a company, responsibilities of a company, directors, dissolution of a company. The 2013 Act is divided into 29 chapters containing 470 sections as against 658 Sections in the Companies Act, 1956 and has 7 schedules.The Act has replaced The Companies Act, 1956 (in a partial manner) after receiving the assent of the President of India on 29 August 2013. The Act came into force on 12 September 2013 with few changes like earlier private companies maximum number of member was 50 and now it will be 200. A new term of "one person company" is included in this act that will be a private company and with only 98 provisions of the Act notified. A total of another 184 sections came into force from 1 April 2014.
The Ministry of Company Affairs thereafter published a notification for exempting private companies from the ambit of various sections under the Companies Act.
Companies Act 1956 was an Act of the Parliament of India, enacted in 1956, which enabled companies to be formed by registration, sets out the responsibilities of companies, their directors and secretaries and also provides for the procedures for its winding.
- One Person Companies (OPC)sec 2(62)
- Women Directors (second proviso to sec 149(1) or 149 subsection read with rule 3 of companies (appointment and qualifications of directors rules, 2014)
- Corporate Social Responsibility
- Registered Valuers
- Rotation of Auditors
- Class Action
- Dormant Company sec 455(1)
- Fast Track Mergers
- Serious Fraud Investigation Office
Brief description of new concepts
- One Person Company is a company with only one person as a member. That one person will be the shareholder of the company. It avails all the benefits of a private limited company such as separate legal entity, protecting personal assets from business liability, and perpetual succession. One Person Company (OPC) is a Company registered with ONLY ONE PERSON as its shareholder. The Nominee shall act as the deemed director on the death or incapacity of the One Person. An OPC is classified as a private company under Companies Act.
- Woman Director: Every Listed Company and Public Company with paid up capital of Rs 100 Crores or more / Public Company with turnover of Rs 300 Crores or more shall have at least one Woman Director, in accordance with the Rule 3 to the Companies (Appointment of directors) Rules, 2014.
- Corporate Social Responsibility Clause (135) Every company having net worth of rupees five hundred crore or more, or turnover of rupees one thousand crore or more or a net profit of rupees five crore or more during any financial year shall constitute a Corporate Social Responsibility Committee of the Board consisting of three or more directors, out of which at least one director shall be an independent director.
- Registered Valuers - Valuation by registered valuers. Clause (247) (1) Where a valuation is required to be made in respect of any property, stocks, shares, debentures, securities or goodwill or any other assets (herein referred to as the assets) or net worth of a company or its liabilities under the provision of this Act, it shall be valued by a person having such qualifications and experience and registered as a valuer in such manner, on such terms and conditions as may be prescribed and appointed by the audit committee or in its absence by the Board of Directors of that company.
- Class action suits (clause 245) For the first time, a provision has been made for class action suits. It is provided that specified number of member(s), depositor(s) or any class of them, may, if they are of the opinion that the management or control of the affairs of the company are being conducted in a manner prejudicial to the interests of the company or its members or depositors, file an application before the Tribunal on behalf of the members or depositors. Where the members or depositors seek any damages or compensation or demand any other suitable action from or against an audit firm, the liability shall be of the firm as well as of each partner who was involved in making any improper or misleading statement of particulars in the audit report or who acted in a fraudulent, unlawful or wrongful manner. The order passed by the Tribunal shall be binding on the company and all its members, depositors and auditors including audit firm or expert or consultant or advisor or any other person associated with the company.
- Dormant Company - Where a company is formed and registered under this Act for a future project or to hold an asset or intellectual property and has no significant accounting transaction, such a company or an inactive company may make an application to the Registrar for obtaining the status of a dormant company(inactive company)
- Serious Fraud Investigation Office (clause 211) Statutory status to SFIO has been proposed. Investigation report of SFIO filed with the Court for framing of charges shall be treated as a report filed by a Police Officer. SFIO shall have power to arrest in respect of certain offences of the Bill which attract the punishment for fraud. Those offences shall be cognizable and the person accused of any such offence shall be released on bail subject to certain conditions provided in the relevant clause of the Bill.
- Fast Track Mergers : The Companies Act, 2013 has separate provisions of fast track merger under Section 233 of Companies Act, 2013. These provisions are notwithstanding with the normal provisions of merger under Section 230 and 232 of this Act. Under fast track merger processes Central Government has the power to sanction all such scheme and there will be no requirement to approach National Company Law Tribunal .
- Prasad, Suresh. "Complete list of Sections of Companies Act, 2013". AUBSP. Retrieved August 7, 2016.
- "Commencement Notification Of Companies Act 2013" (PDF). Ministry of Corporate Affairs, India. Retrieved 11 January 2014.
- Varma, Sindhu. "India: New Companies Act, 2013 – The Cat Is Finally Out". Mondaq. Retrieved 27 March 2014.
- "MCA notifies 183 sections of Companies Act 2013". Business Standards. 26 March 2014. Retrieved 27 March 2014.
- "Business Portal of India : Starting a Business : Regulatory Requirements : Companies Act". National Portal of India. Government of India.
- Prasad, Suresh. "Section 135 - Corporate Social Responsibility Committee". AUBSP. Retrieved September 4, 2015.
- Notified sections of Companies Act, 2013
- Act No. 1 of 1956
- Text of the Companies Act, 1956