In a praiseworthy move , MCA finally brings today some relief for Private Companies in Companies Act 2013. Has issued a draft notification dated 24 June 2014 which will hopefully get passed by houses of parliament soon. I have tried to analyse the details of notification in light of provisions of act. Amongst other things notification importantly provides that : 1. Section 73 subsection 2 (which details conditions to be followed for deposit acceptance) Shall not apply to private companies having 50 or less number of members if they accept monies from their members not exceeding twenty five percent of aggregate of the paid up capital and free reserves or one hundred per cent of the paid up capital, whichever is more, and which inform the details of such monies to the Registrar in the prescribed manner. In crux , taking unsecured loan from shareholders will be allowed without any hassle for Entity with 50 or less shareholders. 2. Sections 101 to 107 and 109 (detailing requirement of min.days notice , quorum , voting manner , proxy manner , chairman ,poll , etc. for meetings ) shall apply unless articles of the private company otherwise provides. In crux , companies can alter AOA to suit their comfort on these sections. 3. Following section / clause shall not apply to Pvt. Company : • Clause (g) of sub-section (3) of section 141 : which provides for disqualification of auditor if is in employment or holds audit of twenty companies ( A big relief for CAs & hence a CA can audit any no. of pvt. company) • Section 160 : which provides notice & Rs.1lakh deposit requirement for proposing person other than retiring director for directorship • Section 162 ; which provides for separate resolution for appointment of each director and not through single resolution • Section 180 (for pvt.co. with 50 or less members) : which mandates boards to exercise few powers only with consent of company through special resolution (sell,lease,dispose assets Or invest Or Borrow ). Hence these transaction shall happen board resolution thereby avoiding co.special resolution and its filing with ROC. • Section 185 : which placed restriction on giving any loan/guarantee to director or related parties • Section 188 : which placed restriction on Related party transaction & required special resolution for same without interested parties voting for same. • Section 196 sub section (4) and (5) : which provided for approving Appointment and remuneration of managing director, whole-time director or manager by board subject approval at general meeting . Also required CG approval if variance from Schedule V. Also provided for intimation to ROC in sixty. • Section 203 sub section (3) : which provided that a whole-time key managerial personnel shall not hold office in more than one company except in its subsidiary company at the same time. MCA notification can be accessed at : mca.gov.in/Ministry/pdf/Draft_Notification_24062014_1.pdf Any decided changes for Pvt.co.clients can accordingly be kept on hold till notification get approved as further exemptions may be added as MCA has seeked suggestions from Stakeholders/Public. Enjoy Companies Act 2013 !! Regards CA. Prabhat Chopra
Posted on: Tue, 24 Jun 2014 15:15:07 +0000
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