India Inc. soared as the Union Cabinet on March 4 gave its green signal to 72 amendments in the Companies Act, 2013 which will decriminalize a number of offenses and moderate the penalty regime to boost ease of doing business.
Crux of the Matter
Run India Inc. Run A Bill to amend the Act will be moved in Parliament during the ongoing session. Punishments for 11 compoundable offenses will be replaced with fines and imprisonment will be removed. The move has come at a time when the Indian economy is struggling to perform at its best due to reduced demands and a global slowdown. In order to make the act more humane, the Finance Minister Sitharaman said that a ministerial panel has looked into different sections in the Companies Act that cause businesses worries. She also explained the proposed changes which will recategorize 23 offenses of 66 compoundable offenses in the Act. Amongst other decisions announced after the cabinet meeting includes providing an exemption from the requirement of having a CSR committee for companies that have an obligation to spend Rs.50 lakhs or less. Cabinet also approved Non-Residents Indians to invest up to 100% from earlier 49% in disinvestment-bound Air India.
PSB Mergers Cabinet also approved a mega-merger of 10 Public Sector Banks into 4 w.e.f April 1, 2020. Oriental Bank and United Bank of India will be merged into Punjab National Bank. Indian Bank will be merged with Allahabad Bank; Andhra Bank and Corporation Bank will be merged into Union Bank of India; Syndicate Bank will be merged into Canara Bank. The Finance Minister said the amalgamation is to enable the creation of digitally-driven consolidated banks with global heft and business synergies.
Curiopedia
The Companies Act 2013 is an Act on Indian company law which regulates incorporation of a company, responsibilities of a company, directors, dissolution of a company. The Act came into force on 12 September 2013. A new term of “one-person company” was included in this act that will be a private company and with only 98 provisions of the Act notified. A total of another 184 sections came into force from 1 April 2014. The Ministry of Corporate Affairs thereafter published a notification for exempting private companies from the ambit of various sections under the Companies Act. The 2013 legislation has stipulations for increased responsibilities of corporate executives in the IT sector, increasing India’s safeguards against organized cybercrime by allowing CEO’s and CTO’s to be prosecuted in cases of IT failure. More Info
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