The new Companies Bill, which seeks to replace a 50-year-old Act, will come up for consideration and passage in the Monsoon Session of Parliament. “The Companies Bill will come in for discussion in Parliament in the Monsoon Session,” the Corporate Affairs Minister, Mr Murli Deora, told reporters on the sidelines of a FICCI event here today.
The new Companies Bill, which was tabled in the backdrop of the Rs 14,000-crore Satyam fraud, promises greater shareholder democracy and stricter corporate governance norms.
The Bill proposes to introduce the concept of class action suits for the first time in India, which would empower investors to sue a company for “oppression and mismanagement’’ and claim damages.
Among other things, it also proposes to tighten the laws for raising money from the public.
The Bill also seeks to prohibit insider trading by company directors or key managerial personnel by treating such activities as a criminal offence.
The Bill could not be taken up for consideration and passage in the Budget Session of Parliament, which was cut short on account of the Assembly elections in four states and one Union Territory.