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The Companies (Amendment) Bill, 2019
August 7 , 2019
1967 days
1007
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- The Companies (Amendment) Bill, 2019 has been passed by both houses of Parliament. It amends the Companies Act, 2013.
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Companies Act, 2013 |
2019 Amendments |
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Corporate Social Responsibility (CSR) |
If CSR money is not fully spent, companies must disclose the reasons for non-spending in their annual report. |
Any unspent annual CSR funds must be transferred to one of the funds under Schedule 7 of the Act (e.g., PM Relief Fund) within six months of the financial year. Violations: A fine between Rs 50,000 and Rs 25,00,000 |
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Debarring auditors |
The National Financial Reporting Authority can Debar a “member or firm” from practising as a Chartered Accountant for a period between six months to 10 years, for proven misconduct. |
The Bill amends the punishment to provide for debarment from appointment as an auditor or internal auditor of a company, or performing a company’s valuation, for a period between six months to 10 years. |
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Change in approving authority |
Change in period of financial year for a company associated with a foreign company, has to be approved by the National Company Law Tribunal. |
Approval powers transferred to Union Government. |
Commencement of business
- A company may not commence business, unless it
- Files a declaration within 180 days of incorporation, confirming that every subscriber to the Memorandum of the company has paid for the shares agreed to be taken by him
- Files a verification of its registered address with the Registrar of Companies (RoC) within 30 days of incorporation.
- Failure to comply with these provisions will result in removal of name from RoC.
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