The Ministry of Corporate Affairs vide its Notification dated Janaury 03, 2020 has hereby amended the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. This notification has amended the following rules of the Companies Act, 2013.

Rule 8A - Appointment of Company Secretaries in Companies

• As per the amended Rules, now Companies having paid up capital more than Ten (10) Crore would now be mandatorily required to appoint Company Secretary

• Effect of Amendment  - Companies having more than 10 Crore Paid Up Capital would be required to appoint Company Secretary instead of previous limit of Five (5) Crore Capital.

Rule 9 - Secretarial Audit Applicability

• As per the amended rules, any Company having outstanding loans or borrowings from banks or public financial institutions of one hundred crore rupees (100) or more.
• Effect of Amendment-  This amendment is introduced to include Private Limited Companies with huge borrowing to comply with Secretarial Audit. Earlier only public companies were required to conduct secretarial Audit.

Below is the Notification from MCA for your reference.

[To be published Scction (i)l in the Gazette of India, Extraordinary, Part II, Section 3,

Sub MINISTRY OF CORPORATE AFFAIRS NOTIFICATION New Delhl,

3rd January, 2020 

• G.S.R. .-ln exercise of the powers conferred by sub-section (1) of section 203 of the companics Act, 2013 (18 of 2013) read with section 469 of the said Act, the central Government hereby makes the following rules further to amend the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, namely:-
• These rules may be called the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2020. (2) They shall be applicable in respect of financial years commencing on or after 1st April, 2020.
• ln the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (herein after referred to as said rules), for rule 8A, the following shall be substituted as under:-
• "8A. Every private company which has a paid up share capital of ten crore rupees or more shall have a whole -time company secretary.".
• In the said rulcs, in rule 9 of the said rules, in sub-rule (1), (i) after clause (b), at the end the word "or" shall be inserted. (ii) aftcr clause (b), the following clause shall be inserted, namely:-
• "(c) every company having outstanding loans or borrowings from banks or public financial institutions of one hundred crore rupees or more.". (iii) the following explanation shall be inserted, namely:-
• "Explanation :- For the purposes of this sub-rule, it is hereby clarified that the paid up share capital, turnover, or outstanding loans or borrowings as the case may be, existing on the last date of latest audited financial statement shall be taken into account.".

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