CONDONATION OF DELAY SCHEME (CODS) - 2018

Some month ago number of directors disqualified by the Ministry of Corporate Affairs has touched more than 300,000 according to the provisions of Section 164(2)(a) of the Companies Act, 2013.

Note: Section 164(2) stated as follow;

No person who is or has been a director of a company which—

(a) has not filed financial statements or annual returns for any continuous period of three financial years; or

(b) has failed to repay the deposits accepted by it or pay interest thereon or to redeem any debentures on the due date or pay interest due thereon or pay any dividend declared and such failure to pay or redeem continues for one year or more,

shall be eligible to be re-appointed as a director of that company or appointed in other company for a period of five years from the date on which the said company fails to do so.

Pursuant to the above said provision it perceived that a person who is or has been a Director of defaulting company shall attract disqualification.

As far as I concern person who is means, a person who was not a director of defaulting company erstwhile or for continuous period of three financial years but if he appointed on current date will attract the disqualification under 164(2)(a) and shall not be eligible  to be re-appointed as a director of that company or appointed in other company for a period of five years.

Now on account of these provisions it perceived that number of Directors has disqualified and it’s not only creates a mental agony for directors but also make ruckus in corporate scenario.

Some prominent names that feature in the list of disqualified directors include former Chief Minister of Jammu and Kashmir Omar Abdullah, Malayalam film star Mohanlal, Maharashtra sales tax commissioner Rajeev Jalota, and others, according to ET article. I could not independently verify the veracity of this list.  

So for eradication of difficulties of defaulting Directors, MCA has drafted a scheme called CONDONATION OF DELAY SCHEME (CODS), 2018 and draft scheme has been placed before the Delhi High Court in response to various writ petition by directors against their disqualification (according to ET).

Some Important point of the scheme

Applicability of the Scheme: scheme will be applicable to all defaulting companies (other than the companies which have been stuck off/whose names have been removed from the register of companies under section 248(5) of the Act). A defaulting company is permitted to file its overdue documents which were due for filing till 30.06.2017 in accordance with the provisions of this Scheme.

Time Period:  shall come into force with effect from 01.01.2018  to 31.03.2018

Forms which has to file:

1.      20B/MGT-7- Form for filing Annual return by a company having share capital.

2.      21A/MGT-7- Particulars of Annual return for the company not having share capital.

3.      23AC, 23ACA, 23AC-XBRL, 23ACA-XBRL, AOC-4, AOC-4(CFS), AOC (XBRL) and AOC-4(non-XBRL) – Forms for filing     Balance Sheet/Financial Statement and profit and loss account.

4.      66-  Form  for  submission  of  Compliance  Certificate  with  the Registrar.

5.      23B/ADT-1- Form for intimation for Appointment of Auditors.

The defaulting company after filing documents under this scheme, shall seek condonation of delay by filing form e-CODS 2018 attached to this scheme along with a fee of Rs. 30,000/- (Rs. Thirty Thousand only) as prescribed under the Companies (Registration Offices and Fee) Rules, 2014 well before the last date of the scheme.

The DINs of the Directors associated with the defaulting companies that have not filed their overdue documents and the e-form CODS, and these are not taken on record in the MCA21 registry and are still found to be disqualified on the conclusion of the scheme in terms of section 164(2)(a) r/w 167(1)(a) of the Act shall be liable to be deactivated on expiry of the scheme period.

Draft scheme is as follow;

Yet it’s not rolled out by MCA officially on its website and it’s only in draft stage.

General Circular No………./2017

File No. 02/04//2017
Ministry of Corporate Affairs

5th Floor,‘A’Wing,Shastri Bhawan
Dr.Rajendra Prasad Road,
NewDelhi-110001.
Dated……2017

To
All Regional Directors,
All Registrar of Companies,
All Stakeholders.

Sir,

Subject: Condonation of Delay Scheme 2018

Whereas, companies registered under the Companies Act,2013 (or its predecessor Act) are inter-alia required to file their Annual Financial statements and Annual Returns with the Registrar of Companies and non-filing of such reports is an offence under the said Act.

Whereas, section 164(2) of the Act read with section 167 of the Companies Act, 2013 [the Act], which provisions were commenced with effect from 01.04.2014, provide for disqualification of a director on account of default by a company in filing an annual return or a financial statement for a continuous period of three years.

Whereas, Rule 14 of the Companies (Appointment and Qualification of Directors) Rules, 2014 further prescribes that every director shall inform to the company concerned about his disqualification, if any, under section 164(2), in form DIR-8.

Whereas, consequent upon notification of provisions of section 164(2), Ministry of Corporate Affairs (MCA) had launched a Company Law Settlement Scheme 2014 providing an opportunity to the defaulting companies to clear their defaults within the time period specified therein and following the due process as notified.

Whereas, MCA in September 2017, identified 3,09,614 directors associated with the companies that had failed to file financial statements or annual returns in the MCA21 online registry for a continuous period of three financial years 2013-14 to 2015-16 in terms of provisions of section 164(2) r/w 167(1)(a) of the Act and they were barred from accessing the online registry and a list of such directors was published on the website of MCA.

Whereas, as a result of above action, there have been a spate of representations from industry, defaulting companies and their directors seeking an opportunity for the defaulting companies to become compliant and normalize operations.

Whereas, certain affected persons have also filed writ petitions before various High Courts seeking relief from the disqualification.

Whereas, with a view to giving an opportunity for the non-compliant, defaulting companies to rectify the default, in exercise of its powers conferred under sections 403, 459 and 460 of the Companies Act, 2013, the Central Government has decided to introduce a Scheme namely “Condonation of Delay Scheme 2018” [CODS-2018] as follows.

1. The scheme shall come into force with effect from 01.01.2018 and shall remain in force up to 31.03.2018

2. Definitions – In this scheme, unless the context otherwise requires, –

(i) “Act” means the Companies Act, 2013 and Companies Act, 1956 (where ever applicable);

(ii) ‘overdue documents’ means the financial statements or the annual returns or other associated documents, as applicable, in the case of a defaulting company and refer to documents mentioned in paragraph 5 of the scheme.

(iii) “Company” means a company as defined in clause of 20 of section 2 of the Companies Act, 2013;

(iv)  “Defaulting company” means a company which has not filed its financial statements or annual return as required under the Companies Act, 1956 or Companies Act, 2013, as the case may be, and the Rules made thereunder for a continuous period of three yea

(v) “Designated authority” means the Registrar of Companies having jurisdiction over the registered office of the company.

3. Applicability: – This scheme is applicable to all defaulting companies (other than the companies which have been stuck off/whose names have been removed from the register of companies under section 248(5) of the Act). A defaulting company is permitted to file its overdue documents which were due for filing till 30.06.2017 in accordance with the provisions of this Scheme.

4. Procedure to be followed for the purposes of the scheme:– (1) In the case of defaulting companies whose names have not been removed from register of companies,-

(i) The DINs of the disqualified directors de-activated at present shall be temporarily activated during the validity of the scheme to enable them to file the overdue documents.

(ii) The defaulting company shall file the overdue documents in the respective prescribed eForms paying the statutory filing fee and additional fee payable as per section 403 of the Act read with Companies (Registration Offices and fee) Rules, 2014 for filing these overdue documents

(iii) The defaulting company after filing documents under this scheme, shall seek condonation of delay by filing form e-CODS 2018 attached to this scheme along with a fee of 30,000/- (Rs. Thirty Thousand only) as prescribed under the Companies (Registration Offices and Fee) Rules, 2014 well before the last date of the scheme.

(iv) The DINs of the Directors associated with the defaulting companies that have not filed their overdue documents and the eform CODS, and these are not taken on record in the MCA21 registry and are still found to be disqualified on the conclusion of the scheme in terms of section 164(2)(a) r/w 167(1)(a) of the Act shall be liable to be deactivated on expiry of the scheme period.

(2) In the event of defaulting companies whose names have been removed from the register of companies under section 248 of the Act and which have filed applications for revival under section 252 of the Act up to the date of this scheme, the Director’s DIN shall be re-activated only NCLT order of revival subject to the company having filing of all overdue documents.

5. Scheme not to apply for certain documents – This scheme shall not apply to the filing of documents other than the following overdue documents:

(i) Form Number 20B/MGT-7- Form for filing Annual return by a company having share capital.

(ii) Form 21A/MGT-7- Particulars of Annual return for the company not having share capital.

(iii) Form 23AC, 23ACA, 23AC-XBRL, 23ACA-XBRL, AOC-4, AOC-4(CFS), AOC (XBRL) and AOC-4(non-XBRL) – Forms for filing     Balance Sheet/Financial Statement and profit and loss account.

(iv) Form 66-  Form  for  submission  of  Compliance  Certificate  with  the Registrar.

(v) Form 23B/ADT-1- Form for intimation for Appointment of Auditors.

6. The Registrar concerned shall withdraw the prosecution(s) pending if any before the concerned Court(s) for all documents filed under the scheme. However, this scheme is without prejudice to action under section 167(2) of the Act or civil and criminal liabilities, if any, of such disqualified directors during the period they remained disqualified.

7. At the conclusion of the Scheme, the Registrar shall take all necessary actions under the Companies Act, 1956/ 2013 against the companies who have not availed themselves of this Scheme and continue to be in default in filing the overdue documents

Yours faithfully,

(KMS. Narayanan)
Assistant Director (Policy)
23387263

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The entire contents of above document have been prepared on the basis of Draft Condonation of Delay Scheme -2018 ­.Whereas deep care has been taken by author to ensure the correctness and completeness of the information provided.

This is nothing but a knowledge sharing initiative by author and author do not    intend to accost any business or profession.

PRIVATE PLACEMENT AS PER COMPANIES ( AMENDMENT ) BILL, 2017

As we are aware about that Companies (Amendment) Bill, 2017 was introduced in Lok Sabha (Lower House) on Wednesday, 16^th Day of March, 2016 which has been passed by the Lok Sabha on Sunday, 02^nd Day of July, 2017 and further bill referred to Rajya Sabha (Upper House) for consideration and passing, after consideration of Bill, Rajya Sabha (Upper house) has passed the Companies (Amendment) Bill, 2017 on Tuesday, 19^th Day of December, 2017. After getting the assent of President it shall come into force.

Section 42 (PRIVATE PLACEMENT)

For section 42 of the principal Act, the following section shall be substituted, namely:

“(1) A company may, subject to the provisions of this section, make a private placement of securities.

(2) A private placement shall be made only to a select group of persons who have been identified by the Board (herein referred to as "identified persons"), whose number shall not exceed fifty or such higher number as may be prescribed [excluding the qualified institutional buyers and employees of the company being offered securities under a scheme of employees stock option in terms of provisions of clause (b) of subsection (1) of section 62], in a financial year subject to such conditions as may be prescribed.

(3) A company making private placement shall issue private placement offer and application in such form and manner as may be prescribed to identified persons, whose names and addresses are recorded by the company in such manner as may be prescribed:

Provided that the private placement offer and application shall not carry any right of renunciation.

Explanation I.—"private placement" means any offer or invitation to subscribe or issue of securities to a select group of persons by a company (other than by way of public offer) through private placement offer-cum-application, which satisfies the conditions specified in this section.

Explanation II.—"qualified institutional buyer" means the qualified institutional buyer as defined in the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended from time to time, made under the Securities and Exchange Board of India Act, 1992.

Explanation III.—If a company, listed or unlisted, makes an offer to allot or invites subscription, or allots, or enters into an agreement to allot, securities to more than the prescribed number of persons, whether the payment for the securities has been received or not or whether the company intends to list its securities or not on any recognised stock exchange in or outside India, the same shall be deemed to be an offer to the public and shall accordingly be governed by the provisions of Part I of this Chapter.

(4) Every identified person willing to subscribe to the private placement issue shall apply in the private placement and application issued to such person along with subscription money paid either by cheque or demand draft or other banking channel and not by cash:

Provided that a company shall not utilise monies raised through private placement unless allotment is made and the return of allotment is filed with the Registrar in accordance with sub-section (8).

(5) No fresh offer or invitation under this section shall be made unless the allotments with respect to any offer or invitation made earlier have been completed or that offer or invitation has been withdrawn or abandoned by the company:

Provided that, subject to the maximum number of identified persons under subsection (2), a company may, at any time, make more than one issue of securities to such class of identified persons as may be prescribed.

(6) A company making an offer or invitation under this section shall allot its securities within sixty days from the date of receipt of the application money for such securities and if the company is not able to allot the securities within that period, it shall repay the application money to the subscribers within fifteen days from the expiry of sixty days and if the company fails to repay the application money within the aforesaid period, it shall be liable to repay that money with interest at the rate of twelve per cent. per annum from the expiry of the sixtieth day:

Provided that monies received on application under this section shall be kept in a separate bank account in a scheduled bank and shall not be utilised for any purpose other than—

(a) for adjustment against allotment of securities; or

(b) for the repayment of monies where the company is unable to allot securities.

(7) No company issuing securities under this section shall release any public advertisements or utilise any media, marketing or distribution channels or agents to inform the public at large about such an issue.

(8) A company making any allotment of securities under this section, shall file with the Registrar a return of allotment within fifteen days from the date of the allotment in such manner as may be prescribed, including a complete list of all allottees, with their full names, addresses, number of securities allotted and such other relevant information as may be prescribed. (Now PAS-3 shall be filed with 15 days instead of 30D days from the date of allotment of securities)

(9) If a company defaults in filing the return of allotment within the period prescribed under sub-section (8), the company, its promoters and directors shall be liable to a penalty for each default of one thousand rupees for each day during which such default continues but not exceeding twenty-five lakh rupees.

(10) Subject to sub-section (11), if a company makes an offer or accepts monies in contravention of this section, the company, its promoters and directors shall be liable for a penalty which may extend to the amount raised through the private placement or two crore rupees, whichever is lower, (earlier it was whichever is higher) ( The penalty provisions for raising of capital are proposed to be rationalized by linking it to the amount involved in the issue).  and the company shall also refund all monies with interest as specified in sub-section (6) to subscribers within a period of thirty days of the order imposing the penalty.

(11) Notwithstanding anything contained in sub-section (9) and sub-section (10), any private placement issue not made in compliance of the provisions of the subsection (2) shall be deemed to be a public offer and all the provisions of this Act and the Securities Contracts (Regulation) Act, 1956 and Securities and Exchange Board of India Act, 1992 shall be applicable.”

_________________________________________________________________________________

The entire contents of above document have been prepared on the basis of Companies (Amendment) Bill, 2017 passed by Rajya Sabha dated 19-12-2017.  Whereas deep care has been taken by author to ensure the correctness and completeness of the information provided.

This is nothing but a knowledge sharing initiative by author and author do not intend to accost any business or profession.

Foreign Direct Investment Policy, 2017

Foreign Direct Investment Policy, 2017

D/o IPP F. No. 5(1)/2017-FC-1 Dated the August 28, 2017

Eligible Investors

·      Non-resident entity can invest in India, subject to the FDI Policy except in those sectors/activities which are prohibited*. However, a citizen of Bangladesh or an entity incorporated in Bangladesh can invest only under the Government route. Further, a citizen of Pakistan or an entity incorporated in Pakistan can invest, only under the Government route, in sectors/activities other than defence, space, atomic energy and sectors/activities prohibited for foreign investment.

* Agriculture (excluding floriculture, horticulture, apiculture and cultivation of vegetables and mushrooms under controlled conditions, the development and production of seeds & planting materials etc.)

Gambling and Betting

Lottery business, including government or private lottery, online lotteries etc.

 Retails trading (expect single-brand product retailing)

Business of chit fund

Nidhi Company

Real estate business or construction of farm houses

Trading in transferable development rights (TDRs)

Manufacturing of tobacco, cigars, cheroots, cigarettes and other tobacco substitutes

·       NRI resident in Nepal and Bhutan as well as citizens of Nepal and Bhutan are permitted to invest in the capital of Indian companies on repatriation basis, subject to the condition that the amount of consideration for such investment shall be paid only by way of inward remittance in free foreign exchange through normal banking channels.

·         A company, trust and partnership firm incorporated outside India and owned and controlled by NRIs can invest in India with the special dispensation as available to NRIs under the FDI Policy.

·     According to Schedule 2 and 2A of FEMA (Transfer or Issue of Security by Persons Resident Outside India) Regulations, FII/FPI can invest in the capital of an Indian company under the Portfolio Investment Scheme, below 10% by an Individual of the capital of the Indian Company and the aggregate limit for FII/FPI investment upto 24% of the capital of the company. This aggregate limit of 24% can be increased to the sectorial cap/statutory ceiling, as applicable, by the Indian company concerned through a resolution by its Board of Directors followed by a special resolution to that effect by its General Body and subject to prior intimation to RBI. The aggregate FII/FPI investment, individually or in conjunction with other kinds of foreign investment, will not exceed sectorial/statutory cap.

Note: An Indian company which has issued shares to FIIs/FPIs under the FDI Policy for which the payment has been received directly into company’s account should report these figures separately under item no. 5 of Form FC-GPR.

·         A SEBI registered Foreign Venture Capital Investor (FVCI) may contribute up to 100% of the capital of an Indian company engaged in any activity mentioned in Schedule 6 of Notification No. FEMA 20/2000, including start-ups irrespective of the sector in which it is engaged, under the automatic route.

Eligible Investee

1.      Indian Company

2.      Partnership Firm/Proprietary Concern

A Non-Resident Indian (NRI) or a Person of Indian Origin (PIO) resident outside India can invest in the capital of a firm or a proprietary concern in India on non-repatriation basis provided;

a.      Amount is invested by inward remittance or out of NRE/FCNR(B)/NRO account maintained with Authorized Dealers/Authorized banks.

b.      The firm or proprietary concern is not engaged in any agricultural/plantation or real estate business or print media sector.

c.       Amount invested shall not be eligible for repatriation outside India.

(ii) Investments with repatriation option: NRIs/PIO may seek prior permission of Reserve Bank for investment in sole proprietorship concerns/partnership firms with repatriation option. The application will be decided in consultation with the Government of India.

(iii) Investment by non-residents other than NRIs/PIO: A person resident outside India other than NRIs/PIO may make an application and seek prior approval of Reserve Bank for making investment in the capital of a firm or a proprietorship concern or any association of persons in India. The application will be decided in consultation with the Government of India.

(iv) Restrictions: An NRI or PIO is not allowed to invest in a firm or proprietorship concern engaged in any agricultural/plantation activity or real estate business or print media.

3.      Trust

FDI is not permitted in Trusts other than in ‘VCF’ registered and regulated by SEBI and ‘Investment vehicle.

4.      Limited Liability Partnerships (LLPs)

FDI in LLPs is permitted subject to the following conditions:

(i)                 FDI is permitted under the automatic route in Limited Liability Partnership (LLPs) operating in sectors/activities where 100% FDI is allowed through the automatic route and there are no FDI-linked performance conditions.

(ii)               An Indian company or an LLP, having foreign investment, is also permitted to make downstream investment in another company or LLP in sectors in which 100% FDI is allowed under the automatic route and there are no FDI-linked performance conditions.

(iii)             Conversion of an LLP having foreign investment and operating in sectors/activities where 100% FDI is allowed through the automatic route and there are no FDI-linked performance conditions, into a company is permitted under automatic route. Similarly, conversion of a company having foreign investment and operating in sectors/activities where 100% FDI is allowed through the automatic route and there are no FDI-linked performance conditions, into an LLP is permitted under automatic route.

(iv)              FDI in LLP is subject to the compliance of the conditions of LLP Act, 2008.

5.      Start-up Companies: (New Concept)

Start-ups can issue equity or equity linked instruments or debt instruments to FVCI against receipt of foreign remittance, as per the FEMA Regulation. In addition, start-ups can issue convertible notes to person resident outside India subject to the following conditions:

1.      A person resident outside India (other than an individual who is citizen of Pakistan or Bangladesh or an entity which is registered / incorporated in Pakistan or Bangladesh), may purchase convertible notes issued by an Indian start-up company for an amount of twenty 5 Lakh rupees or more in a single tranche.

Note: Explanation: For the purpose of this Regulation, a ‘start-up company’ means a private company incorporated under the Companies Act, 2013 or Companies Act, 1956 and recognised as such in accordance with notification number G.S.R. 180(E) dated February 17, 2016 issued by the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, and as amended from time to time.

2.      A start-up company engaged in a sector where foreign investment requires Government approval may issue convertible notes to a non-resident only with approval of the Government.

3.      A start-up company issuing convertible notes to a person resident outside India shall receive the amount of consideration by inward remittance through banking channels or by debit to the NRE / FCNR (B) / Escrow account maintained by the person concerned in accordance with the Foreign Exchange Management (Deposit) Regulations, 2016, as amended from time to time.

Note: Provided that an escrow account for the above purpose shall be closed immediately after the requirements are completed or within a period of six months, whichever is earlier. However, in no case continuance of such escrow account shall be permitted beyond a period of six months.

4.      The start-up company issuing convertible notes shall be required to furnish reports as prescribed by Reserve Bank of India.

COMPARATIVE ANALYSIS AND EFFECT OF COMPANIES (AMENDMENT) BILL, 2017

SERIES - I

COMPARATIVE ANALYSIS AND EFFECT OF COMPANIES (AMENDMENT) BILL, 2017

Section	Companies Act, 2013	Companies (Amendment) Bill, 2017	Effect
2(6)	Definition of Associates Company: The expression “Significant influence” means control of at least 20% of total share capital, or business decisions under an agreement.	The expression “Significant influence means control of at least 20% of total voting power, or control of or participation in business decisions under an agreement. Now Joint Venture is defined under said bill; “Joint Venture” means a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement.	1.. Only by holding of 20%  share capital of another company is not sufficient for making an associate company. 2. Now a company make another company as an associate company in spite of holding of less than 20% of share capital in another company, if he hold shares in another company as per provisions of section 43(a)(ii) read with Rule 4 of Companies (Share Capital and Debenture) Rules,2014,
2(30)	Definition of Debenture: Debenture includes debenture stock, bonds or any other instrument of a company evidencing a debt, whether constituting a charge on the assets of the company or not.	Now a new proviso will be add after said definition:  “ Provided that--- (a). The instruments referred to in Chapter III-D of the RBI Act, 1934; and (b). Such other instrument, as may be prescribed by the central government in consultation with the RBI issue by a company shall not be treated as debenture;	Instrument referred in Chapter III-D of RBI Act, 1934— 1.       Derivative 2.       Money market Instrument 3.       Securities etc. Shall not be treated as deposit.
2(49)	Definition of Interested Director	Omitted
2(51)	Definition of KMP “key managerial personnel”, in relation to a company, means— (i) the Chief Executive Officer or the managing director or the manager; (ii) the company secretary; (iii) the whole-time director; (iv) the Chief Financial Officer; and(omitted) (v) such other officer as may be prescribed;	For sub clause (v) the following sub clauses shall be substituted; (v). Such other officer, not more than one level below the directors who is in whole time employment, designated as KMP by the Board; and (vi) such other officer as may be prescribed
2(76)	Definition of Related Party “related party”, with reference to a company, means— (i) a director or his relative;  (ii) a key managerial personnel or his relative; (iii) a firm, in which a director, manager or his relative is a partner; (iv) a private company in which a director or manager is a member or director; (v) a public company in which a director or manager is a director or holds along with his relatives, more than two per cent. of its paid-up share capital; (vi) any body corporate whose Board of Directors, managing director or manager is accustomed to act in accordance with the advice, directions or instructions of a director or manager; (vii) any person on whose advice, directions or instructions a director or manager is accustomed to act: Provided that nothing in sub-clauses (vi) and (vii) shall apply to the advice, directions or instructions given in a professional capacity; (viii) any company which is— (A) a holding, subsidiary or an associate company of such company; or (B) a subsidiary of a holding company to which it is also a subsidiary; (ix) such other person as may be prescribed;	For sub clause (viii), the following sub clauses shall be substituted; Any body corporate which is— A.. a holding, subsidiary or an associate company of such company; B. a subsidiary of holding company to which it is also a subsidiary; Or C. an investing company or the venturer of the company Explanation: for the purpose of this clause the investing company  or venturer of a company means a body corporate whose investment in the company would result in the company becoming an associate company of the body corporate.
2(85)	Definition of Small Company ‘‘small company’’ means a company, other than a public company,— (i) paid-up share capital of which does not exceed fifty lakh rupees or such higher amount as may be prescribed which shall not be more than five crore rupees; or (ii) turnover of which as per its last profit and loss account does not exceed two crore rupees or such higher amount as may be prescribed which shall not be more than twenty crore rupees: Provided that nothing in this clause shall apply to— (A) a holding company or a subsidiary company; (B) a company registered under section 8; or (C) a company or body corporate governed by any special Act;	In sub clause (i) for the word “5 Crore” rupees the word “10 Crore” rupees shall be substituted. (b) in sub-clause (ii),— (A) for the words "as per its last profit and loss account", the words "as per profit and loss account for the immediately preceding financial year" shall be substituted; (B) for the words "twenty crore rupees", the words "one hundred crore rupees" shall be substituted;
2(87)	Definition of Subsidiary Company “subsidiary company” or “subsidiary”, in relation to any other company (that is to say the holding company), means a company in which the holding company— (i) controls the composition of the Board of Directors; or (ii) exercises or controls more than one-half of the total share capital either at its own or together with one or more of its subsidiary companies: Provided that such class or classes of holding companies as may be prescribed shall not have layers of subsidiaries beyond such numbers as may be prescribed. Explanation.—For the purposes of this clause,— (a) a company shall be deemed to be a subsidiary company of the holding company even if the control referred to in sub-clause (i) or sub-clause (ii) is of another subsidiary company of the holding company; (b) the composition of a company’s Board of Directors shall be deemed to be controlled by another company if that other company by exercise of some power exercisable by it at its discretion can appoint or remove all or a majority of the directors; (c) the expression “company” includes any body corporate; (d) “layer” in relation to a holding company means its subsidiary or subsidiaries;	in clause (87), in sub-clause (ii), for the words “total share capital”, the words “total voting power” shall be substituted;
3		Insertion of new section 3A. If at any time the number of members of a company is reduced, in the case of a public company, below seven, in the case of a private company, below two, and the company carries on business for more than six months while the number of members is so reduced, every person who is a member of the company during the time that it so carries on business after those six months and is cognisant of the fact that it is carrying on business with less than seven members or two members, as the case may be, shall be severally liable for the payment of the whole debts of the company contracted during that time, and may be severally sued there for.".
4	Reservation of Name of Company: (i) Upon receipt of an application under sub-section (4), the Registrar may, on the basis of information and documents furnished along with the application, reserve the name for a period of sixty days from the date of the application.	In section 4 of the principal Act, in sub-section (5), for clause (i), the following shall be substituted, namely:— "(i) Upon recepit of an application under sub-section (4), the Registrar may, on the basis of information and documents furnished along with the application, reserve the name for a period of 20 Days from the date of approval or such other period as may be presecribed: Provided that in case of an application for reservation of name or for change of its name by an existing company, the Registrar may reserve the name for a period of sixty days from the date of approval.".	Now name of Company will be reserved only for 20 days in place of 60 days.
7	Incorporation of Company Section 7(1)(c) stated as: an affidavit from each of the subscribers to the memorandum and from persons named as the first directors, if any, in the articles that he is not convicted of any offence in connection with the promotion, formation or management of any company, or that he has not been found guilty of any fraud or misfeasance or of any breach of duty to any company under this Act or any previous company law during the preceding five years and that all the documents filed with the Registrar for registration of the company contain information that is correct and complete and true to the best of his knowledge and belief;	for the words "an affidavit", the words "a declaration" shall be substituted	After come into effect of Company Amendment Bill , 2017, INC -9 shall not be required to file with ROC for incorporation of Company.
12	A company shall, on and from the 15 day of its incorporation and at all times thereafter, have a registered office capable of receiving and acknowledging all communications and notices as may be addressed to it. Sub section 4 sated as: Notice of every change of the situation of the registered office, verified in the manner prescribed, after the date of incorporation of the company, shall be given to the Reigistrar within fifteen days of the change, who shall record the same.	In section 12 of the principal Act,— (i) in sub-section (1), for the words "on and from the fifteenth day of its incorporation", the words " within thirty days of its incorporation" shall be substituted; (ii) in sub-section (4), for the words "within fifteen days", the words "within thirty days" shall be substituted.

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