The amendment of Companies Act, 2013

The Companies Act, 2013 was passed by the Indian Parliament to consolidate and amend the law relating to companies.

What is the Companies Act, 2013?

• It regulates the incorporation of a company, the responsibilities of a company. appointment of directors and other laws related to the dissolution of a company.
• It replaces any earlier act, Companies Act 1956 which earlier enabled companies to be formed by registration, delineated the responsibilities of a company, their directors and secretaries and provided the procedure for its closing down.
• Two separate bodies were established under the Companies Act, 2013 of India. These are the national Company Law Tribunal (NCLT) and the National Financial Reporting Authority (NFRA).
• The NCLT is a quasi-judicial body in India that adjudicates issues relating to Indian companies. It is the adjudicating authority for insolvency resolution process of companies and limited liability partnerships under the Insolvency and Bankruptcy Code, 2016.
• NFRA was established for the establishment and enforcement of accounting and auditing standards and oversight of the work of auditors. This body was created in the wake of the massive Satyam Scandal and it comprises of a Chairman, 3 full-time members, and a secretary.

What are the new amendments?

The Union Government has proposed a few amendments to the Companies Act, 2013. These proposed amendments will lead to further “promotion of ease of doing business, de-clogging of National Company Law Tribunal and Special Courts” as stated in an official press release.