Committee on Companies Act, 2013 submits its report to Finance Ministry

Ministry of Finance and Corporate Affairs constituted the Company Law Committee in September 2019. The Committee submitted its report to the Finance Minister on November 18, 2019.

Objective of the Committee

The Committee was constituted to decriminalize the Companies Act, 2013. This is being done to provide Ease of Living for Corporate in the country.

Recommendations of the Committee

• The committee has recommended amendments to 46 penal provisions associated with the law. The amendments are either to remove criminality or to allow rectification through alternate methods or to restrict punishment only to fine. Bottom line, the committee suggests to lenient punishments mentiones in the law
• The Committee has recommended to provide further easing of living for law abiding corporate.
• It also insisted on wider consultations during following decisions by the Ministry of finance
  • Permitting appeals in NCLT against the orders of Regional Directors
  • To review provisions on disqualification of directors
  • Reviewing provisions that debars audit firms.

Significance

With World Institutions decelerating growth rates of India, every step towards the financial flow in the country is important. Though India is an agricultural Economy, majority of the contribution towards its GDP is from the service sector. Therefore, it becomes important to provide Ease of Living for the corporates to boost the growth rate.

Month: Current Affairs - November, 2019