The Ministry of Corporate Affairs (MCA) vide its notification dated 18th December 2020 amended few provisions of the Companies (Appointment and Qualification of Directors) Rules, 2014 vide Companies (Appointment and Qualification of Directors) fifth Amendment Rules, 2020 With effect from December 18, 2020.

Summary of Companies (Appointment and Qualification of Directors) fifth Amendment Rules, 2020

  • MCA has given relief in the time period to pass the online proficiency exam. Now, an individual shall pass the online proficiency exam within a period of two years from the date of inclusion of his/ her name in the database.
  • MCA has given relief to Foreign Directors who are also now eligible for exemption for writing the test. This will enable Indian Companies to retain and attract high calibre professionals as Directors.
  • MCA has given relief to Bureaucrat/ Public officials who are also now eligible for exemption for writing the test. This will enable Indian Companies to retain and attract high calibre public officials as Directors.
  • Exemption from passing the online proficiency test is given to an individual who has served for a total period of not less than 3 years in any of the designations and organizations specified by the Central Government as against the earlier specified period of 10 years.
  • As per the amendment, only 50% mark is sufficient to pass the online proficiency test.

Important Points of Companies (Appointment and Qualification of Directors) fifth Amendment Rules, 2020

  • An Independent Director has to mandatorily get himself registered in the database on or before 31st December 2020
  • Online proficiency test needs to be completed within 2 years from the date of inclusion of his name in the database.
  • An individual who obtain a score of 50 or more shall be deemed to have passed such test.
  • Exemption from passing the online proficiency test is given to an individual who has served for a total period of not less than 3 years as KMP in public Companies/Body corporates or holding a Designation in organizations specified by the Central Government.

Disclaimer: This note has been prepared for general guidance on matters of interest only and does not constitute a professional advice. In no Event the author/Firm shall be liable for any direct, indirect, special or Incidental damage resulting from or arising out of or in connection with the use of this information.

Author Bio

Qualification: CS
Company: Mohit Patel & Associates
Location: Mumbai, Maharashtra, IN
Member Since: 29 Jul 2019 | Total Posts: 17
Mr. Mohit Patel who is an Associate Member of the Institute of Company Secretaries of India, Registered Trade Mark Agent & has done his graduation in commerce from Mumbai University. He has been known for his analytical & unique thought process even in pre-qualification stage. He is known fo View Full Profile

My Published Posts

More Under Company Law

3 Comments

  1. MURTHY HVG says:

    I have one query, can any expert resolve please..

    i have become member to housing society, and credited amount since 2005 to till 2018. i have been alloted site in 2020 and i have sold the same in 2020 only.
    it has to be indexed since 2005 for the money paid.
    Some say it is stcg, and i bound pay tax.

    Pl clarify at the earliest.

Leave a Comment

Your email address will not be published. Required fields are marked *

Search Posts by Date

February 2021
M T W T F S S
1234567
891011121314
15161718192021
22232425262728