Union Cabinet has approved further amendments in Companies Act 2013.
In order to cut down the steps for formation of Company, cabinet has on 29th April, 2015, gave nod to the following amendments;
- The requirement for filing declaration by a company before commencement of Business or exercising its borrowing powers under Section 11 of Companies Act 2013 will be dispensed off
It was important to file Declaration for Commencement of Business within 180 days of Registration in order to start the operations. Now, after Cabinet approval, this is dispensed off
_ The procedure for laying out draft notifications granting exemptions to various classes of companies or modifying provisions of the Act in Parliament under Section 462 of Companies Act 2013 is rationalised.
Section 462 empowers Central Government to exempt certain class or classes of companies from complying with any of the provisions of Companies Act 2013. In order to put in place a speedier process for approval of draft notifications for providing exemptions etc. from specific provisions of the Act to a class of companies, it is proposed to rationalize the procedure for laying draft notifications granting exemptions.
Please note that the Companies (Amendment) Bill 2014 has been passed by Lok Sabha but is pending at Rajya Sabha.
In order to cut down the steps for formation of Company, cabinet has on 29th April, 2015, gave nod to the following amendments;
- The requirement for filing declaration by a company before commencement of Business or exercising its borrowing powers under Section 11 of Companies Act 2013 will be dispensed off
It was important to file Declaration for Commencement of Business within 180 days of Registration in order to start the operations. Now, after Cabinet approval, this is dispensed off
Section 11(1) (a) of the Companies Act 2013 states that a company having a share capital shall not commence any business or exercise any borrowing powers unless a declaration is filed by a director in such form and verified in such manner as may be prescribed, with the Registrar that every subscriber to the memorandum has paid the value of the shares agreed to be taken by him and the paid-up share capital of the company is not less than five lakh rupees in case of a public company and not less than one lakh rupees in case of a private company on the date of making of this declaration;
Requirement for minimum paid- up share capital for private and public companies was proposed to be omitted vide Companies (Amendment) Bill, 2014 as passed in Lok Sabha. Accordingly an amendment was proposed in Section 11(1)(a) which has reference to Minimum Paid up capital for private and public limited companies, by omission of the words “and the paid-up share capital of the company is not less than five lakh rupees in case of a public company and not less than one lakh rupees in case of a private company”
It is now proposed in the amendment to Companies (Amendment) Bill 2014 to do away with the requirement for filing a declaration by a company before commencement of business or exercising its borrowing powers as provided in section 11 of the Companies Act, 2013.
_ The procedure for laying out draft notifications granting exemptions to various classes of companies or modifying provisions of the Act in Parliament under Section 462 of Companies Act 2013 is rationalised.
Section 462 empowers Central Government to exempt certain class or classes of companies from complying with any of the provisions of Companies Act 2013. In order to put in place a speedier process for approval of draft notifications for providing exemptions etc. from specific provisions of the Act to a class of companies, it is proposed to rationalize the procedure for laying draft notifications granting exemptions.
Please note that the Companies (Amendment) Bill 2014 has been passed by Lok Sabha but is pending at Rajya Sabha.
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