THE COMPANIES (AMENDMENT) ACT, 2017 received the assent of the Hon’ble President of India on the 3rd January, 2018 which is an An Act to further amend the Companies Act, 2013. By this act 93 amendments been carried out in Companies Act, 2013 to provide relief to stakeholders and to provide more clarity on some of the provisions of Companies Act, 2013.
MCA has so far issued Notification S.O. 351(E) dated: 23/01/2018, S.O. 630(E) dated: 09/02/2018 and S.O. 1833(E) dated: 07/05/2018 by which various provisions of Companies (Amendment) Act, 2017 is been made effective. This Article discusses Provisions of Companies (Amendment) Act, 2017 which are not yet enforced-
|Sr. No||Companies (Amendment) Act, 2017||Corresponding section of Companies Act, 2013||Amendment pertains to|
|1.||5||7||an affidavit a declaration from each subscribers to MOA and first directors.|
|2.||6||12||Notice of situation or change of situation of registered office within fifteen thirty days of incorporation/change.|
|3.||10||42||Private Placement of securities.|
|4.||15||73||1. Deposit repayment reserve account
(i) 15% – 20%
(ii) Only for deposits maturing during following financial year
(iii) on or before 30th April each year
2. Deposit Insurance – no longer required.
3. Eligibility for defaulting companies – if company makes good the default and 5 years elapsed from last date of making good the default.
|5.||16||74||Repay within 3 years from commencement of this act i.e. maximum by 31.03.2017 or such other earlier expiry date whichever is earlier. Provided renewal of deposit shall take place by complying CHP V and rules made thereunder.|
|6.||20||82||An additional 270 (total of 300) days will be available to file Form CHG-4 with payment of additional fees.|
|7.||21 (except clauses (i) and (ii) )||89||Beneficial interest has been explained as right to exercise voting right/ right to participate in dividend/ such other distribution thereby widening the meaning of beneficial interest to cover a pledge of shares with a right to usufruct to the pledgee. This section is not applicable to government companies.|
|8.||22||90||Identification of significant beneficial owners of the company, intimating the same to Registrar and maintaining register of the same.|
|9.||23 (except clauses (iii) & (iv) )||92||1. Disclosure of indebtedness need not be made in annual return;
2. No need to specify additional details of shares held by FIIs;
3. CG may prescribe abridged form of annual return for OPC, Small companies and certain other classes of companies;
4. Doing away with MGT-9. Placing of annual return on the website and disclosing its link in Board’s report;
|10.||24||93||Form MGT-10 need not be filed by listed company;|
|11.||25||94||Only SR is required in case registers and copies of annual return are to be kept in any other place in India where more than 1/10th of total no of member resides.|
|12.||26||96||An unlisted company can obtain consent of all members in advance, either in writing/electronic means and hold AGM at any place in India.|
|13.||36||134||1. CEO will be required to sign Board Report irrespective of whether he is a director or not;
2. Instead of annexing MGT-9 in Board Report, web address if any to be provided where complete annual return has been placed;
3. To disclose the manner in which annual performance evaluation has been carried out;
4. Disclosures already made in financial statements need not be provided in Board Report;
5. Providing web-link of policies such as CSR, NRC etc.;
6. CG may prescribe abridged form of annual return for OPC, Small companies and certain other classes of companies.
|14.||37||135||1. Clarification already existed under CSR Rules relating to no appointment of independent director in CSR committee in case appointment of ID u/s 149(4) not applicable to company;
2. Rectification relating to areas/ subject specified in Schedule VII;
3. To substitute ‘average net profit with ‘net profit’.
|15.||66||196||Company can make application to CG even if resolution for appointing MD is passed with simple majority instead of special resolution;|
|16.||67||197||Managerial Remuneration – doing away with requirement of seeking approval of Central Government.|
|17.||68||198||1. For an investment company premium on shares/ debentures issued/ sold shall form part of the normal profits generated from its ordinary business and not of capital nature;
2. In calculation of section 198 profit & free reserves credit shall not be given to unrealized gains, notional gains or revaluation of assets;
3. It shall allow the adjustment of b/f losses incurred prior to the Act,2013 .
|18.||69||200||1. Approval of CG not required in case of payment of remuneration to managerial personnel;
2. The title of the section to be amended as ‘COMPANY TO FIX LIMIT WITH REGARD TO REMUNERATION’
|19.||70||201||As requirement of obtaining CG approval has been done away with reference of section 96 shall be inserted;|
|20.||71||216||For the purpose of investigation of ownership the persons having beneficial interest in shares or beneficial owners or significant beneficial owners shall be considered.|
|21.||75||366||A company under this section can get itself registered with two or more members too as a private company.|
|22.||76||374||LLPs will not be required to file any affidavit/undertaking with ROC.|
|23.||77||379||Sections 380-386, 392, 393 shall apply to all foreign companies provided Central Government may exempt certain class of foreign companies.|
|24.||78||384||It covers a foreign company within the purview of section 135 (clarification)|
|25.||79||391||This section is only applicable to a foreign company having pending repayment/redemption of money raised through issue of securities o’wise such foreign companies are required to follow sections 355, 376 & 377 in case of no such pendency.|
|26.||80 (except first proviso to clause (i) & clause (ii) )||403||1. Any document/fact/information other than referred to in first proviso be submitted/filed/registered/recorded on payment of additional fee;
2. In case of default for two or more occasions the document/fact/information be submitted/filed/registered/recorded on payment of higher additional fee which shall not be less than twice the additional fee;
|27.||81||406||1. A company will be treated as Nidhi or a Mutual Benefit Society only on declaration made by CG by notification in Official Gazette;
2. A copy of every notification proposed to be issued under sub-section (2), shall be laid in draft before each House of Parliament, while it is in session as specified;
3. The copies of every notification issued under this section shall, as soon as may be after it has been issued, be laid before each House of Parliament.
Author – Deepam Shah, Executive,Vinod Kothari & Company