Government constitutes Company Law Committee for examining and making recommendations on Companies Act, 2013

The Government has constituted a Company Law Committee for examining and making recommendations to the government on various provisions and issues pertaining to the implementation of the Companies Act, 2013 and the Limited Liability Partnership Act, 2008.

The objective of setting up this committee is to improve the ease of living by providing ease of doing business by law abiding corporates, fostering improved corporate compliance for stakeholders at large and also address emerging issues having impact on the working of corporates in the country.

The company law committee will be chaired by Injeti Srinivas, secretary of the corporate affairs ministry will look into issues including the introduction of a settlement mechanism for offences under the companies act as well as de-clogging the National Company Law Tribunals and the measure to improve the functioning of statutory bodies under the Companies Act including the Serious Frauds Investigations Office (SFIO),The Investor Education And Protection Fund Authority (IEPFA) And The National Financial Reporting Authority (NFRA).

An ammendment passed in the budget session session of the parliament stated that the government has recategorized 13 offences under Companies Act as civil offences.Finance And Corporate affairs minister Nirmala Sitharaman had also announced that the government would not seek to pursue criminal against individuals for violations of CSR provisions.

The committee would also look to identify specific provisions under the Companies Act and the LLP act that could be amended to improve ease of doing business and that the committee would not be restricted to only reviewing the forms that companies and LLPs are require to file under the acts, which means that the committee can review anything  about companies and their restriction is not only to the forms that are registered under the Companies Act and the LLP act.

The committee will also examine the feasibility of a mechanism through which the government could settle the cases involving the violations under the Companies act.

The committee will also look into measures to further de-clog the National Companies Law Tribunal which deals with the offenses under the companies act,the competition act and insolvency cases under the insolvency and bankruptancy code.In an amendment in the budget session the government transfered the power to grant approval for the conversion of public company to a private company or a change of financial year of company to the corporate affairs ministry from the NCLT.

ET had in its April 16 edition reported that the government was set to do a comprehensive review of the LLP act inncludng steep penalties for delays  in filing of returns and other issues in the implementation of the act.

The Companies law committee set up by government to address issues related to Companies Act 2013 will give its final report on changes required next month. The final meeting of the committee will be held on November 30 in Mumbai which will be chaired by the Corporate Affairs Secretary.