{"id":22424,"date":"2019-07-29T18:45:44","date_gmt":"2019-07-29T13:15:44","guid":{"rendered":"https:\/\/enterslice.com\/learning\/?p=22424"},"modified":"2019-09-05T18:18:03","modified_gmt":"2019-09-05T12:48:03","slug":"loksabha-approves-companies-act-amendment-bill-2019","status":"publish","type":"post","link":"https:\/\/enterslice.com\/learning\/loksabha-approves-companies-act-amendment-bill-2019\/","title":{"rendered":"Loksabha Approves Companies Act Amendment Bill 2019"},"content":{"rendered":"<p>The Loksabha passed the Companies Act 2013 <a class=\"glossaryLink\"  aria-describedby=\"tt\"  data-cmtooltip=\"&lt;div class=glossaryItemTitle&gt;Amendment&lt;\/div&gt;&lt;div class=glossaryItemBody&gt;An &amp;quot;amendment&amp;quot; refers to the formal change or correction of a legal document, often involving additions, variations, or deletions to address irregularities or clarify points in an agreement.(...)&lt;\/div&gt;\"  href=\"https:\/\/enterslice.com\/learning\/terms\/amendment\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'>Amendment<\/a> <a href=\"https:\/\/www.prsindia.org\/billtrack\/companies-amendment-bill-2019\"><strong>Bill<\/strong><\/a> 2019. The Bill was introduced by the Finance Minister of India, Mrs Nirmala Sitharaman as on Friday.<\/p>\n\n\n\n<p>The Bill was introduced with a spirit to improve the ease of\ndoing business in India.<\/p>\n\n\n\n<p><strong>The major highlights of\nthe Bill are as follows;<\/strong><\/p>\n\n\n\n<ul><li>Focus on improving the\nease of doing business<\/li><li>Tightened the\nprofessional conduct of auditors<\/li><li>The significant change\nin CSR laws<\/li><\/ul>\n\n\n\n<p><\/p><div class=\"shadow1\"><em>&ldquo;This will ensure\nbetter governance and is company-friendly,&rsquo;&rsquo; <\/em>\n\n\n\n<p><em>&ldquo;The government has so\nfar de-registered four lakh shell companies. Also, companies not spending the\nmandatory 2% profit on CSR activities for a total period of four years will be\nrequired to deposit the amount in a special account,&rdquo;&nbsp; <\/em><\/p>\n\n\n\n<p><em>&nbsp;&ldquo;India has become the first country to make\nCSR spending mandatory through a law. The companies will have one year to firm\nup the CSR proposal and another three years to spend funds. In case money\nremains unspent for one plus three years, it will have to be moved to an escrow\naccount,&rsquo;&rsquo; <\/em><strong>said the Minister.<\/strong><\/p><\/div>\n\n\n\n<p><strong>The Main Amendments that took place are as follows;<\/strong><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Issue of\nDematerialized Shares<\/strong><\/h3>\n\n\n\n<p>AS per the provisions of the Companies Act 2013, the public\ncompanies can issue shares only in electronic form. The Bill proposed that the\nsame should be followed for other classes of companies.<strong><\/strong><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Re-Categorization of\nOffences<\/strong><\/h3>\n\n\n\n<p>As per the new Companies Act Amendment 2019, the various compoundable offences prescribed in the Act are re-categorized. The Bill made 16 of the 81 compoundable offences as civil defaults. Where government-appointed officers will have the discretion to impose penalties.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>New Corporate Social\nResponsibility Law<\/strong><\/h3>\n\n\n\n<p>The amendment brought an important change in the <a href=\"https:\/\/en.wikipedia.org\/wiki\/Corporate_social_responsibility\">CSR laws<\/a> in India. As per the provisions of the Companies Act 2013, the companies were liable for disclosure of reasons if they do not spend their CSR funds.<\/p>\n\n\n\n<p>However, as per the new amendment, any unspent annual CSR\nfunds must be transferred to any of the funds mentioned in schedule 7 of the\ngiven Act. The transfer must occur within six months of the end of the\nfinancial year.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Debarring Auditors<\/strong><\/h3>\n\n\n\n<p>The new amendment introduced strict action against auditors\nwho are caught in the Act of misconduct. As per the amendment, the Financial\nReporting authority can debar a professional or a firm to practice as a\nchartered accountant. The debarring period starts for six months and can extend\nup to 10 years. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Registration Charges<\/strong><\/h3>\n\n\n\n<p>&nbsp;As per the customary\nprovisions of the Companies Act 2013, companies must register their charges\ncreated on their <a class=\"glossaryLink\"  aria-describedby=\"tt\"  data-cmtooltip=\"&lt;div class=glossaryItemTitle&gt;Property&lt;\/div&gt;&lt;div class=glossaryItemBody&gt;Property refers to the legal designation of ownership over valuable items or assets held by an individual or a business. This ownership grants the holder certain legal rights to use, consume,(...)&lt;\/div&gt;\"  href=\"https:\/\/enterslice.com\/learning\/terms\/property\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'>property<\/a> within 30 days of the creation of charge. The\ndeadline for this compliance is 300 days. However, as per the amendment, the\ndeadline has been reduced to 60 days. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Change in Penalty amount in the compounding of offences<\/strong><\/h3>\n\n\n\n<p>As per the companies act, the regional director can settle\noffences with a penalty to Rs 5 lakhs. However, The amendment now raised the\nmaximum amount of penalty to Rs 25 lakhs. <\/p>\n\n\n<a href=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/07\/lok-sabha-approves-new-bill-to-amend-companies-act-2013.pdf\" class=\"pdfemb-viewer\" style=\"width: 767px; \" data-width=\"767\" data-height=\"max\" data-toolbar=\"bottom\" data-toolbar-fixed=\"on\">lok-sabha-approves-new-bill-to-amend-companies-act-2013<br><\/a>\n<p class=\"wp-block-pdfemb-pdf-embedder-viewer\"><\/p>\n\n\n\n<h3><b>Also, Read:<\/b> <mark style=\"background: #fffd03 !important\"><a href=\"https:\/\/enterslice.com\/learning\/web-based-kyc-verification-service-for-directors-by-mca\/\">Web-Based KYC Verification Service for Directors by MCA<\/a><\/mark><\/h3><br><br>\n","protected":false},"excerpt":{"rendered":"<p>The Loksabha passed the Companies Act 2013 Amendment Bill 2019. The Bill was introduced by the Finance Minister of India, Mrs Nirmala Sitharaman as on Friday. The Bill was introduced with a spirit to improve the ease of doing business in India. The major highlights of the Bill are as follows; Focus on improving the [&hellip;]<\/p>\n","protected":false},"author":14,"featured_media":22427,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[2611],"tags":[2616],"acf":{"service_id":"220"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v14.6.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Loksabha Approves Companies Act Amendment Bill 2019 - Read Full Story<\/title>\n<meta name=\"description\" content=\"The Loksabha passed the Amendment Bill 2019. The Bill was introduced by the Finance Minister of India, Mrs Nirmala Sitharaman as on Friday.\" \/>\n<meta name=\"robots\" content=\"index, follow\" \/>\n<meta name=\"googlebot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta name=\"bingbot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/enterslice.com\/learning\/loksabha-approves-companies-act-amendment-bill-2019\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Loksabha Approves Companies Act Amendment Bill 2019 - Read Full Story\" \/>\n<meta property=\"og:description\" content=\"The Loksabha passed the Amendment Bill 2019. The Bill was introduced by the Finance Minister of India, Mrs Nirmala Sitharaman as on Friday.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/enterslice.com\/learning\/loksabha-approves-companies-act-amendment-bill-2019\/\" \/>\n<meta property=\"og:site_name\" content=\"Enterslice\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/enterslice\" \/>\n<meta property=\"article:published_time\" content=\"2019-07-29T13:15:44+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2019-09-05T12:48:03+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/07\/Amendment-in-Companies-Act-2013.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"630\" \/>\n<meta name=\"twitter:card\" content=\"summary\" \/>\n<meta name=\"twitter:creator\" content=\"@enterslice\" \/>\n<meta name=\"twitter:site\" content=\"@enterslice\" \/>\n<!-- \/ Yoast SEO plugin. -->","authorName":"Akash Dubey","authorImageUrl":"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/04\/DSC_04891.jpg","authorDescription":"Akash Dubey is a Law Graduate and works as an\r\nAdvisor at Enterslice. He is proficient in Legal\r\nand Financial Advisory. His expertise in the\r\nskills of Legal and Financial Research is an aid\r\nto his strengths as an Advisor.","postViews":392,"readingTime":2,"nextPost":{"id":22401,"slug":"implications-of-newly-introduced-section-194m"},"prevPost":{"id":22408,"slug":"time-of-supply-under-gst"},"featuredMediaUrl":"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/07\/Amendment-in-Companies-Act-2013.jpg","postTerms":"MCA Notification","_links":{"self":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts\/22424"}],"collection":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/users\/14"}],"replies":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/comments?post=22424"}],"version-history":[{"count":0,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts\/22424\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/media\/22427"}],"wp:attachment":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/media?parent=22424"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/categories?post=22424"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/tags?post=22424"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}