The Lok Sabha on 17 December 2014 passed the Companies (Amendment) Bill, 2014 to amend the Companies Act, 2013.
The main objective of the bill is to ease the process of doing business in India.
Provisions of the Bill
• The paid-up capital criteria has been scrapped while threshold limits for various transactions for getting shareholders' nod has now been stipulated.
• Specific punishment is prescribed for those raising illegal deposits from the public.
• For meeting a corporate demand, an amendment proposes prohibiting public inspection of Board resolutions filed in the registry.
• Protection of confidentiality of board resolutions, as well as the provision of auditors will be required to report suspected frauds at the companies audited by them.
• The Bill also proposes to exempt corporates from the need to get shareholders' nod in the case of related party transactions valued lower than 100 crore rupees or 10 percent of net worth.
• The bill also exempts related party transactions between holding companies and wholly owned subsidiaries from the requirement of approval of non-related shareholders.
• Inclusion of the provisions for writing off past losses/depreciation before declaring dividend for the year.
• For winding up the cases speedily, now the cases shall be heard by 2-member Bench instead of a 3-member Bench.
• Special Courts will try only those offences that carry imprisonment of two years or more.
Who: Lok Sabha
When: 17 December 2014