This Article provides an insight over recent changes brought in by Companies (Amendment) Act, 2017. The article starts with the background and the introduction followed by the definitions which are amended under the Act. The article also provides the gist the sections which are amended, inserted, substituted, or omitted under the Companies (Amendment) Act 2017. The last section of this article brings out the positive impact of the amendments across the industry.



The Companies Act, 2013 was introduced more than three years now. Since then there have been number of amendments made through different circulars, notifications, rules and likewise to make it simpler. But still there were some practical difficulties, complexity in some of the provisions, which felt the need for Companies (Amendment) Act, 2017.The Companies (Amendment) Bill 2017 was introduced on 16th March 2016 in Lok Sabha. Thereafter, the Bill was presented to standing committee for its report. The Standing Committee submitted its report on 30th November 2016 after taking into consideration different views. The Companies (Amendment) Bill, 2017 passed by Lok Sabha on July 27, 2017, received the assent of Rajya Sabha on December 19, 2017. The Bill received President’s assent on 03rd January 2018. Thus, Companies (Amendment) Act, 2017 was born.


The Companies (Amendment) Act, 2017 brings with it many changes including in the areas of Preferential Allotment, Related Party Transactions, Financial Reporting, Managerial Remuneration, Corporate Social Responsibility (CSR), Boards’ Report, Definitions, Deposits and other matters. The Companies (Amendment) Act, 2017 harmonizes with other statutes and facilitates to the more ease of doing business. Till date Section 1 and 4 of the said act have been notified.



Sr.No Particulars Section Amendment
1 Members severally liable in certain cases 3A This is new section wherein the members of any company are reduced below statutory minimum (2 in Private Limited Company or 7 in Public Limited Company) for more than six months; and are continuing business, with the members being cognizant of the fact, then in such cases, those continuing members will be liable for the payment of whole debts of the company during that time and such members can be severally sued.
2 Proposed Name Reservation 4 (5)(i) ⇒ The period of an application for reservation of new name by a proposed company has been reduced from sixty days to twenty days.

⇒ The period of an application for reservation of new name by an existing company is sixty days only.

Incorporation of Company 7(1)(c ) The word ‘Affidavit’ while filing INC-9 for an incorporation of any company is substituted with the word ‘Declaration’.
3 Registered Office 12 The period of having a registered office for a new company and thereafter change of registered office in case of an existing company has been increased from fifteen days to thirty days
4 Authentication of documents, proceedings or contracts 21 In this section, now even any employee duly authorized by Board of Directors can authenticate any documents, proceedings or contracts by or on behalf of the company.
5 Matters to be stated in Prospectus 26 This section is modified to state such information and set out such reports on financial information as may be specified by the Securities & Exchange Board in consultation with Central Government. Clauses (a),(b) and (d) are deleted. This is to bring in harmonization between Companies Act and SEBI.
6 Civil liability for mis-representation in prospectus 35 This section is amended under the 35(2)(c) to include the cases where an professional or an expert can plead innocence for this liability.
7 Offer or invitation for subscription of securities on private  placement 42 Key takeaways from the amendment

⇒ Private Placement offer and application will not carry any right of renunciation

⇒ Company shall not utilise monies raised through private placement unless allotment is made and the return of allotment is filed with the Registrar.

⇒ Return of allotment to be filled within 15 days of allotment.

8 Voting Rights 47(1) The provisions of this section were earlier subject to Section 43 and 50(2). Now it is subjected to 188(1) also.
9 Prohibition on issue of shares at discount 53(2)A The amended provision has introduced the issue of shares at discount to creditors in case of conversion of debt into equity in pursuance to any statutory resolution plan or debt restructuring in accordance with Reserve Bank of India Act, 1934 of Banking (Regulation) Act, 1949.
10 Issue of Sweat Equity Shares 54(1)(c ) This clause is now omitted.
11 Further Issue of Capital 62 ⇒ While issuing shares 62(1)(c),in addition to the  valuation report by a registered valuer, the conditions of Chapter III and other conditions are required to be followed.

⇒ The notice under 62(2) can now be sent through courier also. Proof of delivery of notice is required to be maintained.

12 Prohibition on acceptance of deposits from public 73 ⇒ Section 73(2) specifying the conditions to be fulfilled to issue deposits has been modified.

⇒ Section 73(2)(c), wherein the company is required to deposit on or before 30th April each year, a sum equal to twenty percent of deposit to be matured during the financial year (as compared to fifteen percent for financial year and next following financial year in corresponding previous Act.)

⇒ Section 73(2)(d) is omitted.

⇒ Certification area is widened under Section 73(2)(e), where the company is required to certify that there are no defaults in repayment of deposits and if there, the company have made them good and period of five years have been elapsed.

13 Repayment of Deposits etc accepted before commencement of this Act 74(1)(b) The amended act states the company will repay such deposits within three years from the commencement of this Act or before the expiry of period for which deposits were accepted whichever is earlier.

Such deposits can be renewed subject to conditions prescribed in Chapter V and rules.

14 Punishment for contravention of Section 73 or 76 76A ⇒ Under Section 76A(a), the amount of penalty for contravention of section 73 or 76 has been modified as one crore rupees or twice the amount of deposit accepted by the company whichever is lower (Previously it was not less than one  crores and extending to ten crores)

⇒ Under Section 76A(b), every officer who is in default will be punishable with imprisonment upto seven years and fine both.(previously it was either imprisonment or fine)

15 Duty to Register Charges etc 77(1) Under  Section 77(1) after third proviso, this Section will not apply to charges prescribed in consultation with RBI
16 Application for registration of charge 78 The amended section gives more clarity in respect of time period, as it now reads “register the charge within the period of thirty days referred to in sub-section (1) of section 77″ (previously just reference of Section 77)
17 Company to report satisfaction of charge 82 Under this section, the satisfaction of charge can be reported to Registrar beyond the period of thirty days but within three hundred days of such satisfaction or payment, with payment of additional fees.
18 Declaration in respect of beneficial interest in any share 89 The term ‘beneficial interest’ is defined now. Beneficial interest in share includes, directly or indirectly, through any contract, arrangement, or otherwise, the right or entitlement of a person alone or together with  any other person to

(i) exercise or cause to be exercised any or all of the rights attached to such share or

(ii) receive or participate in any dividend or other distribution in respect of such share.

19 Register of significant beneficial owners in a company 90 This is altogether new section introduced. It deals with significant beneficial owners. The term significant beneficial owner means holding of beneficial interest of not less than twenty five percent or such other as defined for significant influence or control in section 2(27). This section prescribes the provisions for maintenance of register of significant beneficial owners, filing of prescribed returns, inspection, notices, power of tribunal, penalties for non– compliance and likewise..
20 Annual Return 92 ⇒ The Amendment Act, 2017 has omitted sub-clause (c) of Section 92 regarding indebtedness of the company. Clause (j) is modified where shares held by foreign institutional investors are required. Their further details like name, address, country, registration etc have been omitted.

⇒ Also, the proviso is added where there is a provision of abridged form of annual return for one person company, small company or such other company is introduced.

⇒ The companies to give web-link of annual return in Board’s report and shall place the same on website, if any.

21 Return to be filed with Registrar in case of promoters’ stake changes 93 This Section is now omitted.
22 Place of keeping and inspection of registers, returns etc 94 ⇒ In case of keeping returns, registers other than registered office, the copy of the proposed resolution is not required to be given to registrar {Section94(1)}.

⇒ Under Section 94(3), a proviso is inserted which prescribes conditions where inspection, copies, extract will not be available, when they are closed as per Section 94(2).

23 Annual General Meeting 96 The Annual General Meeting of a unlisted company can be held at any place in India with prior consent (either electronically or writing) of all the members is taken.
24 Calling of Extra Ordinary General Meeting 100 ⇒ The extra ordinary general meeting of a company can be held at any place within India.

⇒ The extra ordinary general meeting of a company which is wholly owned subsidiary of a company incorporated outside India can be held in or outside India.

25 Notice of meeting 101 The meeting on shorter notice can be conducted:

⇒ In case of AGM, consent of at least 95 percent of members entitled to vote thereat.

⇒ In case of EoGM, a company having share capital majority in number of members holding at least 95 percent of paid share capital.

⇒ In case of EOGM, a company not having share capital, 95 percent of total voting power.

26 Postal Ballot 110 The items which are required to be transacted though postal ballot, can be transacted through, by convening Extra Ordinary General Meeting by giving facility to members to vote by electronic means.
27 Resolutions and Agreements to be filled 117 ⇒ In Section 117(1), reference of time specified under section 403 is now omitted.

⇒ In Section 117(2), reference of section 403 is substituted with ‘therein’. The penalty for failure to file the resolution(s) is reduced.

a) For company: not less than one lakhs (previously five lakhs)

b)For Officer in default: not less than fifty-thousand (previously one lakhs)

Under Section 117(3) applicability of this section:

  • Clause (e) is now omitted
  • A proviso is added to clause (g) wherein the clause will not be applicable to banking company in the ordinary course of its business
28 Report on Annual General Meeting 121 ⇒ Under Section 121(2), reference of time specified under Section 403 is omitted.

⇒ Under Section 121(3) reference of section 403 is substituted with ‘therein’

29 Declaration of Dividend 123 ⇒ Under this amendment, the profit (inclusive or exclusive) for payment of dividend is modified. In order to carry the profit & loss account for payment of dividend, unrealized gains, notional profit, revaluation of assets, any change in value or asset or liability on their measurement at fair value is excluded.

⇒ The interim dividend provisions are modified. Interim dividend can be declared during the financial year or at any during from the closure of financial year till holding of annual general meeting. Interim Dividend can be paid out of current year’s profit, surplus in profit and loss account or profits from the financial year till the quarter preceding the date of dividend.

⇒ In case of losses during the current financial year up to the end of quarter immediately preceding the date of declaration of interim dividend, then the rate of interim dividend shall not be more than average of dividend during the last three financial years.

30 Financial Statement 129 The Section 129(3) is modified to include associate companies along with subsidiary companies to be consolidated with the financials of the company. The same form, manner and applicable accounting standards to be followed and the same is required to be placed before the annual general meeting.AOC-1 now also includes associate companies details.
31 Re-opening of accounts on court’s or Tribunal’s order 130 The accounts for a period of not more than eight years can be re-opened except in cases where they are required to be preserved for more than eight years
32 Constitution of National Financial Reporting Authorty 132 ⇒ The penalty under section 132(4)(c)(A)(II) for professional or other misconduct in case of firms is reduced “not less than five lakhs” (previously not less than ten lakhs).

⇒ An appeal can be made to Appellate Tribunal under Section 134(5) against order of NFRA.

⇒ Section 134(6) to 9 are now omitted.

33 Financial Statements Board’s Report etc 134 ⇒ Section 134(1) is amended wherein Chief Executive Officer (CEO), whether director or not is required to sign the financial statements including consolidated financial statements.

⇒ Section 134(3)(a) is modified to the extent that extract of annual return (MGT-9) is to be placed on the company’s website and only link is to be given in Boards’  Report.

⇒ Section 134(3)(p) is modified to annual evaluation of performance of the Board , its committees, and individual Directors has been made.

⇒ Proviso to clause 134(3)(q), wherein the information or disclosure is already made in financial statements, such disclosures shall only be referred to in Directors’ Report

⇒ Also, the different policies referred are to be put on company’s website and only its salient features and changes are included in Board’s Report giving the web-link.

⇒Section 134(3A) is inserted in view of abridged Board’s Report for One Person Company or Small Company.

34 Corporate Social Responsibility (CSR) 135 ⇒ This section has undergone many changes which has brought clarity in understanding it.

⇒ Section 135(1) To invoke CSR provision, one of the condition is net profit of five crores or more in the immediately preceding financial year (previously it was during any financial year).

⇒ Proviso to Section 135(1) is inserted in cases where an independent director is not required to be appointed, Corporate Social Responsibility (CSR) committee will have two or more directors.

⇒ Section 135(3)(a) is modified to include areas or subject as specified in Schedule VII (previously it was as specified in Schedule VII). The scope of areas or activities of CSR has now widened.

⇒ The explanation to 135(5) is modified whereby while, calculating the net profit, managerial remuneration under section 198 is excluded.

35 Right of member to copies of audited financial statement 136 The important amendment in this section is proviso to Section 136(1), whereby notice is sent less than 21 days before the meeting, the same shall be treated as duly sent if agreed by in case of company having share capital by majority of members entitled to vote holding not less than 95 percent of paid-up share capital; in case of no share capital not less than 95 percent of total voting power.
36 Copy of financial statement to be filed with Registrar 137 ⇒ References of within the time specified under section 403 are omitted accordingly.

⇒ There is a proviso after fourth proviso, wherein exemption is provided to holding company from attaching audited financials of its foreign subsidiary,  in case if foreign subsidiary is not required to prepare audited financials as per rules of  the country of incorporation. Attaching unaudited financials will be sufficient compliance. If not in English language, to be translated accordingly.

37 Appointment of Auditors 139 Ratification of statutory auditors in annual general meeting is now omitted.
38 Removal, Resignation of auditor and giving special notice 140 The penalty for non compliance of Section 140(2) is now substituted with not less than fifty thousand rupees or remuneration of auditor whichever is less
39 Eligibility, qualifications, and disqualification of auditors 141 The eligibility condition for appointment as a statutory auditor is modified to include an additional condition that, a person who directly or indirectly, renders any service referred to in section 144 to the company or its holding or its subsidiary will not be appointed.
40 Powers and Duties of auditors and auditing standards 143 ⇒ The auditor will have access to records of associate companies also while preparing financial statements (standalone of consolidated ) of holding company

⇒ The auditor to comment on internal financial control with reference to financial statement.

41 Punishment for contravention 147 ⇒ The penalty for contravention is changed under the Companies Amendment Act, 2017, Where the Auditor contravenes the provision for Section 139, 143, 144 and 145 the penalty of not less than twenty-five thousand rupees or four times of remuneration will be levied.

⇒ The penalty for contravention of the proviso, penalty of of not less than fifty thousand rupees which may extend to twenty-five lakhs or or eight times the remuneration of auditor whichever is less are introduced.

⇒ Section 147(5), In case of criminal liability of an audit firm, the concerned partner or partners who acted in fraudulent manner or abetted, colluded in any fraud will only be liable.

42 Company to have Board of Directors 149 ⇒ Section 149(3), In every company, at least one director who has stayed in India for a Minimum  period of 182 days during the financial year (previously calendar year). In case of newly incorporated company, the period will be calculated accordingly.

⇒ The section 149(6) relation to meaning of an Independent Director is substituted with additional provisions.

43 Appointment of Directors 152 In Section 152 (3) and (4), any other number as may be prescribed under Section 153 is inserted.
44 Application for Allotment of Director Identification Number 153 A proviso is added under this section wherein the Central Government can prescribed any other identification number as DIN, and in that case if any individual holds such number, the requirement of applying DIN will not apply.
45 Company to inform Director Identification Number to Registrar 157 The reference of within the time specified under section 403 or before the expiry of the period under section 403 is now omitted.
46 Right of other person other than retiring directors to stand for directorship 160 The deposit of amount One Lakhs for any Director other than retiring director will not be applicable to Independent Director or director recommended by Nomination and Reumeration Committee, or recommended by Board of Directors where committee is not applicable.
47 Appointment of Additional director, alternate director and nominee director 161 A person will also not be appointed as an alternate director, if he/she is already an alternate director in that company.{Section 161(2)}.

Section 161(4) is now applicable to all companies {Being the words ‘In case of Public Company’ is now omitted}, wherein any casual vacancy is to be filled and Board and subsequently will be approved in the immediate next general meeting.

48 Disqualification for appointment of Directors 164 Where a person is appointed as Director in a company which is in default of Section 164(2), that person will not incur disqualification for a period of six months from date of his appointment.
49 Number of Directorship 165 Dormant company is excluded while calculating the limits of twenty companies
50 Vacation of office of Director 167 Where the director incurs any disqualification under 164(2), his office of director in other companies except the one in default will be vacated automatically.
51 Resignation of Director 168 Filling of DIR-11 is optional in case of resignation of Director.
52 Meetings of the Board 173 A proviso to proviso to Section 173(2) is added whereby, if a proper quorum is there in a meeting through physical presence of Directors, then any other director can participate through video conferencing or audio-visual means on matters including the restricted ones.
53 Audit Committee 177 ⇒ Under Section 177(1),the modification in this section is that it’s now applicable to listed public company (earlier listed company).

⇒ Under 177(4)(iv) after the proviso, the following has been inserted

  • Transactions which are not covered under Section 188 and not approved by Audit Committee, it can make recommendations to Board and the Board will consider and approve such transactions.
  • A Director can enter into related party transactions for an amount not exceeding one crores without prior approval of audit committee but needs to get it ratified within a period of three months. In absence of ratification, contract is voidable at the option of audit committee. In case contract is with related party to any director or under an authority of any director, such director is liable to indemnify the company against any loss.
  • Transactions between Holding Company and Wholly owned subsidiary will not require the approval of audit committee.
54 Nomination, and Remuneration Committee and Stakeholders Committee 178 ⇒ The section is now applicable to every listed public company(previously listed company){178(1)}

⇒ The Committee to provide the manner of evaluation of Board, Committees, individual director. The evaluation can be carried by Board, Committee or external party. The Committee to review its implementation and compliance.  {178(2)}.

⇒ The changes in respect of Board’s Report are already discussed above in section 134.

⇒ Inability to resolve or consider any grievance will not be considered as contravention of this section. {Proviso to 178(8)}.

55 Restrictions on Powers of Board 180 While calculating the borrowing limits under section 180(1)(c), in addition to paid up share capital, free reserves, now securities premium will also be considered.
56 Disclosure of interest by Director 184 ⇒ The penalty for contravention of section 184(1) and 2 is now increased it may extend to one lakhs rupees (earlier fifty thousand rupees)

⇒ Section 184(5)(b) is now substituted. :

This section will not be applicable to any contracts or arrangement between two companies or one company and another body corporate and where any Director or body corporate or two holds not more than two percent of paid-up share capital in other company or body corporate.

57 Loan to Director 185 This entire section 185 is now substituted:

⇒ A company will not provide any loan or guarantee or security for loan to any director, holding company, any partner or relative of such director.

⇒ The company can advance loan represented by a book debt or give any guarantee, or provide any security in connection with loan, taken by a any person in whom director of the company is interested subject to

i) special resolution is passed with the requisite explanatory statement

ii) loans are utilized by borrowing company for its principal business activities

⇒ the expression “any person in whom any of the director of the company is interested” means—

(a) any private company of which any such director is a director or member; (b) any body corporate at a general meeting of which not less than twenty-five per cent. of the total voting power may be exercised or controlled by any such director,or by two or more such directors, together; or (c) any body corporate, the Board of directors, managing director or manager, whereof is accustomed to act in accordance with the directions

58 Loan and Investment by company 186 The section 186 provides for special resolution in general meeting, if in case the loan, guarantee or security for loan , acquisition of securities exceeds the sixty percent of paid –up capital, free reserves, securities premium. This approval has to be prior approval. The Companies Amendment Act, 2017 provides for exemption if such loan, guarantee, security for loan, acquisition through subscription, acquisition of securities is from holding company to wholly owned subsidiary. The company will disclose the same in financial statements.
59 Related Party transactions 188 The section provides that no member (in case of public company) will vote in general meeting if that member is interested in related party contract or arrangement. This was of practical issue in many closely held public companies. The Amendment Act, of 2017 has exempted those companies from this restriction in which more than ninety percent of members, in number are relatives of promoter or related party. Such members can now vote on the resolution.
60 Forward Dealing in securities and Insider Trading 194 and 195 Both the sections are now omitted
61 Appointment of Whole Time Director, Managing Director or Manager 196 The Companies Act, 2013, provided that person above seventy years of age can be appointed as MD, WTD, or Manager, if special resolution is passed in this regard and explanatory statement provides  the justification for it. The amendment provides that in case no special resolution is passed, but votes casted in favor are more than votes cast against it and Central Government is satisfied on justification of appointment, Such person can be appointed as MD or WTD or Manager.
62 Managerial Remuneration 197 The major changes in this section are that’

⇒ Approval of central government for remuneration in excess of limits prescribed has been done away. The company now with special resolution can pay remuneration as per the limits prescribed in the section and rules and schedule V.

⇒ Any excess paid directly or indirectly by way remuneration under this section will be refunded. Such Director will refund the amount within two year or lesser period.

⇒ Prior consent of non-convertible debenture holders, bank, financial institution, or secured creditor in case the company has defaulted in payment of dues.

⇒ The excess remuneration can be waived by passing a special resolution and with prior approval of any secured creditor in (c) above

⇒ The auditor in his report under section 143 to comment whether company is paying remuneration within the limit laid down under this section.

63 Computation of Profits 198 ⇒ The profits from sale or issue of shares and debentures by any investing company as per section 186 will be taken while computing profits under this section.

⇒ Any amount representing unrealized gains, notional gains or revaluation of assets will not be taken while computing profits.

64 Central Government or company to fix limit with regard to remuneration 200 ⇒ The word Central Government or appearing twice is now omitted.
65 Forms or and procedure in relation to , certain applications 201 The section has been more clearly worded to include the reference of Section 196 in case of any application to Central Government.{Section 201(1) and Section 201(2)(a)}
66 Investigation of Ownership of the company 216 An additional condition is added for the purpose of determining true owner under section 216(1)(c);

Person having or had beneficial interest or have /had been holding beneficial shares significant beneficial shares in the company

67 Inspectors’ Report 223 A copy of Inspectors Report can now be obtained by members, creditors whose interest may get affected.
68 Purchase of Minority Shareholding 236 The term ‘transferor company’ used in 236(4) to (6) now substituted with ‘company whose shares are being transferred’
69 Valuation by registered valuer 247 The point of amendment in this section 247(2)(d) is that registered valuer will not undertake valuation of any assets in which he has direct or indirect interest during the period of three years prior to his appointment as valuer or three years after the valuation of assets was conducted by him.
70 Companies Capable of being registered 366 Minimum two or more members (previously seven or more) are required for conversion of any company formed under any act or Parliament other than this act or under any other law into a company under this Act. This will ease the conversions any LLP, OPC, Partnership Firm, Society into a  Private Company

A company with less than seven members will be register as a Private Company

71 Obligations of companies registering under this part 374 Upon conversion of a LLP into a company, such LLP will be automatically dissolved without any further act or deed.
72 Application of Act to foreign companies 379 The present section is renumbered as sub-section (2). Section 380 to Section 386 (both inclusive) and 392,393 apply to foreign company.
73 Debentures, annual return, registration of charges, books of accounts and their inspection 384 The Section 135 in respect of Corporate Social Responsibility will also be applicable to foreign company subject to such exemptions, modifications as may be made under rules there under.
74 Application of Section 34 to 36 and Chapter XX 391 The section is modified, subject to Section 376; the provisions of winding up Chapter XX of company will be applicable to a foreign company, if such foreign company has raised money through offer or issue of securities under this Act and which have not been repaid.
75 Fee for filing etc 403 The Companies Amendment Act, 2017 has increased the fee in delay in filling forms, returns, documents, information under section 92 (Annual Return), and section 137(financial statements). The additional fees will be note less than hundred rupees per day. It will differ from class of companies.

⇒ If there is delay in filling forms, returns, documents, information in other sections, then the company will without prejudice to any legal action in that section will file , submit such forms, returns, documents with additional fees.

⇒ If there is default in filling aforesaid, on two or more occasions, then higher additional fees will be prescribed which will not be less than twice the additional fees.

⇒ Where a company fails or commits any default under section 403(1) before the expiry of the period specified in the relevant section, the company and the officers of the company who are in default, shall, without prejudice to the liability for the payment of fee and additional fee, be liable for the penalty or punishment provided under this Act.

76 Power to modify act in its application to Nidhis 406 The new section is substituted governing the provisions relating to Nidhis, notification, application etc.
77 Qualification of President and Members of Tribunal 409 The qualification(s) to become a Technical Member is now revised.
78 Constitution of Appellate Tribunal 410 Appellate Tribunal will hear appeals for orders against Tribunal and National Financial Reporting Authority.
79 Qualification of Chairperson and Members of Appellate Tribunal 411 The qualifications of technical member are now revised.
80 Selection of Members of Tribunal and Appellate Tribunal 412 The Secretary in the Department of Financial Services in the Ministry of Finance is now a member of Selection Committee. Chairperson will have right of casting vote in case of equality of votes.
81 Establishment of Special Courts 435 The existing section is substituted with wherein the compositions of its members, coverage of offences of Special Courts have been modified.
82 Application of Code to proceedings before Special Court 438 In cases of proceeding of Code of Criminal Procedure, the Special Court will be deemed to be Court of Session or the court of Metropolitan Magistrate or a Judicial Magistrate of the First Class
83 Offences to be non-cognizable 439 The word ‘shareholder’ in section 439(2) is substituted with word’ member’
84 Transitional Provisions 440 The section is amended in line with Section 438. Court of Session or the Court of Metropolitan Magistrate or a Judicial Magistrate of the First Class, is inserted.
85 Compounding of Certain offences 441 Under the section, 441(1), offences punishable with imprisonment  only or punishable with fine or imprisonment will not be compounded
86 Factors determining level of punishment 446A Under this new section , the court or special court will consider, factors like size of company, nature of business, injury to public, nature and repittion of default to be consider before levying any punishment.
87 Lesser Penalties for One Person Company or Small Company 446B Not more than half of penalties as originally mentioned in respect of  failure to comply with the provisions of Sections 92(5), 117(2), 137(3) in terms of imprisonment, fine, or both will be levied on one person company or small company
88 Punishment for Fraud 447 ⇒ Frauds involving an amount of at least ten lakh rupees or one per cent. of the turnover of the company, whichever is lower will be punishable with imprisonment for a term not less than six months  but which may extend to ten years and will also be liable for fine which will be not less than amount of fraud and may extend to three times the amount involved in fraud. This will carry higher punishments.

⇒ Fraud involves an amount less than ten lakh rupees or one per cent. of the turnover of the company, whichever is lower,and does not involve public interest, any person guilty of such fraud shall be

⇒ punishable with imprisonment for a term which may extend to five years or with fine which may extend to twenty lakh rupees or with both.

89 Delegation by Central Government or its powers and functions 448 The proviso to Section 448(1) is now omitted.


The Companies (Amendment), 2017 is definitely an act which has in many ways tried to reduce the challenges, practical issues, complex areas which were there in the Companies Act, 2013. It has also directed for heavy penalties in terms of non-compliance of some of the sections of the Act and Frauds which will definitely increased the importance of compliance in corporate overall. Similarly, the approach for ease in doing business, harmonization with other acts will show its results soon. The article encompasses the overview of key changes brought by the Amendment Act 2017. The entire contents of this article are solely for information purpose and have been prepared on the basis of relevant provisions. This is not an exhaustive list. For more detailed understanding, Please refer the Companies (Amendment) Act, 2017..


Companies Act 2013 and Companies (Amendment) Act, 2017, Google images.

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