As the new government in India launches ‘Make in India’ campaign in September 2014, to promote new businesses in India, on the other side World Bank issues its Doing Business 2015 in October 2014, in which it placed India at 142th place downgraded by 2 ranks as compared to previous year rankings.
And may be due to this the new government has taken steps to improve the ease of doing business in India and try to vanish the traditional requirements that are coming from old age laws.
As said by PM Narendra Modi, that he wants to be in list of Top 50 in the ease of doing business and as also it is said that Developed country is not the one where poor use their own car but is the one where rich and poor travel by same class.
Steps taken by Government aiming the increase of ease to do business in India:
In the month of December’14, cabinet proposes 14 changes in the new companies act. As of now Lok sabha has passed this amendment, in order to increase the comfort level of doing and starting a business in India and out of 14 the main changes which can lead to change are:
Making common seal optional and other related changes for authorization for execution of other legal documents therefore, this leads to closing up the traditional thin line of delegacy authorization requirement.
Auditor required to report only material frauds to government
Streamlining related party transaction norms.
No dividends till carried-forward losses/depreciation are written off. Also dividends not paid or claimed will not be transferred to Investor Protection Fund till seven years.
As one step is left for the passing of the bill, after that this company incorporation process may become 4 or 5 day hassle free process.
We have tried to use the language as simple as possible to make the entrepreneurs understand the important aspects while raising investment. Apart from the above, there are certain other clauses are also there which also can also prove vital in your business. It is your business, it is your world, be cautious and go and win the world.
(Agam Gupta, is a practicing Chartered Accountant, entrepreneur expert and founder of www.Quickcompany.in, a leading website for registering companies in India and can be contacted at [email protected] or +91 9540618336)