Companies Act 2013

Companies Act 2013

An Act to consolidate and amend the law relating to companies.
Citation	Act No. 18 of 2013
Territorial extent	India
Enacted by	Parliament of India
Date assented to	29 August 2013
Date signed	29 August 2013
Date commenced	12 September 2013 (98 sections) 1 April 2014 (184 sections)
Legislative history
Bill	The Companies Bill, 2012
Bill citation	Bill No. 121-C of 2011
Repealing legislation
The Companies Act 1956
Status: In force

Companies Act 2013 is an Act of the Parliament of India which regulates incorporation of a company, responsibilities of a company, directors, dissolution of a company. The 2013 Act is divided into 29 chapters containing 470 sections as against 658 Sections in the Companies Act, 1956 and has 7 schedules.^[1]The Act has replaced The Companies Act, 1956 (in a partial manner) after receiving the assent of the President of India on 29 August 2013. The Act came into force on 12 September 2013 with few changes like earlier private companies maximum number of member was 50 and now it will be 200. A new term of "one person company" is included in this act that will be a private company and with only 98 provisions of the Act notified.^[2]^[3] On 27 February 2014, the MCA stated that Section 135 of the Act which deals with corporate social responsibility will come into effect from 1 April 2014. On 26 March 2014, the MCA stated that another 183 sections will be notified from 1 April 2014.^[4]

The Ministry of Company Affairs thereafter proposed a draft notification for exempting private companies from the ambit of various sections under the companies act. ^[5]

New Concepts

One Person Companies (opc)^[6]
Women Directors
Corporate Social Responsibility.
Registered Valuers
Rotation of Auditors
Class Action
Dormant Company
Fast Track Mergers
Serious Fraud Investigation Office

Brief description of new concepts

One Person Company is a company with only one person as a member. That one person will be the shareholder of the company. It avails all the benefits of a private limited company such as separate legal entity, protecting personal assets from business liability, and perpetual succession. One Person Company (OPC) is a Company registered with ONLY ONE PERSON as its shareholder. An OPC is classified as a private company under Companies Act.
Woman Director: Every Listed Company /Public Company with paid up capital of Rs 100 Crores or more / Public Company with turnover of Rs 300 Crores or more shall have at least one Woman Director.
Corporate Social Responsibility Clause (135)^[7] Every company having net worth of rupees five hundred crore or more, or turnover of rupees one thousand crore or more or a net profit of rupees five crore or more during any financial year shall constitute a Corporate Social Responsibility Committee of the Board consisting of three or more directors, out of which at least one director shall be an independent director.
Registered Valuers-Valuation by registered valuers. Clause (247) (1) Where a valuation is required to be made in respect of any property, stocks, shares, debentures, securities or goodwill or any other assets (herein referred to as the assets) or net worth of a company or its liabilities under the provision of this Act, it shall be valued by a person having such qualifications and experience and registered as a valuer in such manner, on such terms and conditions as may be prescribed and appointed by the audit committee or in its absence by the Board of Directors of that company
Class action suits (clause 245) For the first time, a provision has been made for class action suits. It is provided that specified number of member(s), depositor(s) or any class of them, may, if they are of the opinion that the management or control of the affairs of the company are being conducted in a manner prejudicial to the interests of the company or its members or depositors, file an application before the Tribunal on behalf of the members or depositors. Where the members or depositors seek any damages or compensation or demand any other suitable action from or against an audit firm, the liability shall be of the firm as well as of each partner who was involved in making any improper or misleading statement of particulars in the audit report or who acted in a fraudulent, unlawful or wrongful manner. The order passed by the Tribunal shall be binding on the company and all its members, depositors and auditors including audit firm or expert or consultant or advisor or any other person associated with the company.
Dormant Company - Where a company is formed and registered under this Act for a future project or to hold an asset or intellectual property and has no significant accounting transaction, such a company or an inactive company may make an application to the Registrar for obtaining the status of a dormant company.
Serious Fraud Investigation Office (clause 211) Statutory status to SFIO has been proposed. Investigation report of SFIO filed with the Court for framing of charges shall be treated as a report filed by a Police Officer. SFIO shall have power to arrest in respect of certain offences of the Bill which attract the punishment for fraud. Those offences shall be cognizable and the person accused of any such offence shall be released on bail subject to certain conditions provided in the relevant clause of the Bill.
Fast Track Merger: The Companies Act, 2013 has separate provisions of fast track merger under Section 233 of Companies Act, 2013. These provisions are notwithstanding with the normal provisions of merger under Section 230 and 232 of this Act. Under fast track merger processes Central Government has the power to sanction all such scheme and there will be no requirement to approach National Company Law Tribunal (powers presently exercised by the High Court).

Previous legislation

Companies Act 1956 was an Act of the Parliament of India, enacted in 1956, which enabled companies to be formed by registration, and set out the responsibilities of companies, their directors and secretaries.^[8] The Act was administered by the Government of India through the Ministry of Corporate Affairs and the Offices of Registrar of Companies, Official Liquidators, Public Trustee, Company Law Board, Director of Inspection, etc. Since its commencement, it was amended many times, in which amendment of 1988, 1990, 1996, 2000 and 2011 were notable.

References

↑ Prasad, Suresh. "Complete list of Sections of Companies Act, 2013". AUBSP. Retrieved 12 September 2014.
↑ "Commencement Notification Of Companies Act 2013" (PDF). Ministry of Corporate Affairs, India. Retrieved 11 January 2014.
↑ Varma, Sindhu. "India: New Companies Act, 2013 – The Cat Is Finally Out". Mondaq. Retrieved 27 March 2014.
↑ "MCA notifies 183 sections of Companies Act 2013". Business Standards. 26 March 2014. Retrieved 27 March 2014.
↑ http://www.companiesact.in/Companies-Act-2013/News-Details/545/%20MCA%20lays%20draft%20notification%20us%20462%20for%20Private%20Companies%20in%20Parliament
↑ https://www.icsi.edu/portals/70/516102013.pdf
↑ Prasad, Suresh. "Section 135 - Corporate Social Responsibility Committee". AUBSP. Retrieved September 4, 2015.
↑ "Business Portal of India : Starting a Business : Regulatory Requirements : Companies Act". National Portal of India. Government of India.

External links

Notices and circulars from MCA

Indian Legislations

Constitution of India Indian Penal Code CrPC

In Force

Corruption	Benami Transactions Black Money Corruption Lokpal Mines & Minerals Act 2015 Money Laundering Whistle Blowers

Criminal	Arms Act, 1959 Armed Forces (Special Powers) Act Armed Forces Tribunal Act, 2007 Criminal Law (Amendment) Act, 2013 Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

Education	Right of Children to Free and Compulsory Education Act

Environment	Biological Diversity Act, 2002 Environment Protection Act, 1986 Indian Forest Act, 1927

Financial	Aadhaar Act Companies Act 2013 Foreign Exchange Management Act Income Tax Act, 1961 Insurance Act, 1938 National Rural Employment Guarantee Act 2005 Real Estate (Regulation and Development) Act, 2016 Reserve Bank of India Act, 1934 RTI Securities Laws (Amendment) Act, 2014 Street Vendors Act, 2014 Urban Land (Ceiling and Regulation) Act, 1976

Healthcare	Central Council of Homoeopathy Act, 1973 Drugs and Cosmetics Act, 1940 Drugs and Magic Remedies Act Narcotic Drugs and Psychotropic Substances Act, 1985 Clinical Establishments Act

Personal	Hindu Adoptions and Maintenance Act (1956) Hindu Marriage Act Hindu Minority and Guardianship Act Hindu Succession Act, 1956 Special Marriage Act, 1954

Social	Consumer Protection Act, 1986 Essential Commodities Act Essential Services Maintenance Act Indecent Representation of Women (Prohibition) Act National Food Security Act, 2013

State Laws	Anti-Superstition and Black Magic Act

State Reorganisation	Chattisgarh Jharkhand Punjab States Telangana Uttarakhand

Transportation	Motor Vehicles Act, 1988 National Waterways Act, 2016 The Inland Vessels (Amendment) Act, 2007

Other	Delimitation Act Enemy Property Act, 1968 Representation of the People Act

Repealed

Pre-Independence	Age of Consent Act, 1891 Criminal Tribes Act Hindu Widows' Remarriage Act, 1856 Indian Motor Vehicles Act, 1914

Post-Independence	Anti-Copying Act, 1992 Foreign Exchange Regulation Act Interest Tax Act, 1974 Maintenance of Internal Security Act Prevention of Terrorism Act, 2002 Terrorist and Disruptive Activities (Prevention) Act The Gold (Control) Act, 1968 Gift Tax Act, 1958 Wealth Tax Act, 1957

Proposed

Pending	Goods and Services Tax Bill Insolvency and Bankruptcy Code Marriage Laws Amendment Bill (India) Road Transport and Safety Bill

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