Latest Amendments in Companies Act 2013 as per Union Budget 2021

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Finance Minister Mrs. Nirmala Sitharaman recently presented the Union Budget on 1st February 2021. This Budget talks about various amendments in the Companies Act 2013 regarding:

SMALL COMPANY

The definition of Small Company has been revised vide Notification No. CG-DL-E-01022021-224862 dated February 1, 2021. Regarding Article 469(1) and Article 469(2), Companies (Specification of Definitions Details) Rules, 2014 was revised namely Companies (Specification of Definitions Details) Amendment Rules, 2021. These amendment regulations revise those in Section 2 clause 85 sub-clauses (i) and (ii), the definition of small companies mentioned, which states that the paid-up capital must not exceed Rs. 2,00,00,000/- (Rupees Two Crores only) and the turnover should not exceed Rs. 20,00,00,000/- (Rupees Twenty Crores only). Tod develop the definition of a small company, it now says: 

1. a company whose paid-up capital does not exceed Rs. 2,00,00,000/- (Rupees Two Crores only) or an amount greater as prescribed which cannot exceed Rs. 10,00,00,000/- (Rupees Ten Crores only).

2. a company whose turnover is primarily based on profit and loss account for the previous economic year no longer exceeds Rs. 20,00,00,000/- (Rupees Twenty Crores only) or an amount greater as prescribed which should not exceed Rs. 100,00,00,000/- (Rupees Hundred Crores only).

A Holding Company, Section 8 Company, Subsidiary Company, or any other body corporate governed by a special act does not come under a small company

ONE PERSON COMPANY

Previously, NRIs were not allowed to incorporate one-person companies in India but now any Indian person can establish a one-person company in India. As per this amendment, the residential status of NRIs was reduced from 182 days to 120 days. The provisions regarding the turnover and paid-up capital of this company have been omitted. Regarding conversion of a one-person company to a public company or private company, it can be done anytime instead of waiting for 2 years after its establishment as per the new amendment. The conversion can be done by filing e-Form No. INC-6 along with the following attachments:

1. Altered Memorandum of Association and Articles of Association
2. Copy of the resolution passed for such conversion under Section 122 (3)
3. list of creditors
4. list of proposed members of members and Directors
5. Latest audited balance sheet and profit and loss account

MERGER OR AMALGAMATION OF STARTUP COMPANIES

As per Companies (Compromises, Arrangements, and Amalgamations), Amendment Rules 2021, mergers or amalgamation between two startup companies and between one or more start-up companies with one or more small companies can be eligible for fast-track mergers. 

Comments

  1. UnknownJune 7, 2021 at 4:43 PM

    So insightful

    ReplyDelete
  2. ABHINANDAN PANDEYJuly 8, 2021 at 4:37 PM

    Good! can we also write about:
    1. Manipur illegal encounter
    2.One Rank One Pension
    3.Arm forces news controversersy
    4.permanent commission of 50 womens?

    ReplyDelete

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