Amendments in the Companies Act, 2013
Amendments in the Companies Act, 2013 during the calendar year 2023
1. Waiver of additional fees during the release of 45 E-Forms for the Company in MCA-V3
On January 09, 2023, MCA vide General Circular No. 01/2023 allowed additional time of 15 days for filing 45 e-forms (as mentioned in the Circular), without levying additional fees in cases where the due dates for filing of these 45 e-forms fall during the period between 07.01.2023 and 22.01.2023 due to the introduction of these 45 e-forms on MCA21 Version 3.0 and not being available on MCA21 Version 2.0 during the said date.
The link for the aforesaid General Circular is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=xHxXexcBmc5%252Bd%252FsJEZzXiw%253D%253D&type=open
2. Physical filing of Form GNL-2 & MGT-14 (related to Prospectus) due to migration from V2 to V3
On January 09, 2023, MCA vide General Circular No. 02/2023 decided that the Companies intending to file Form GNL-2 (filing of prospectus-related documents) and MGT-14 (filing of resolutions relating to prospectus-related documents) during the migration period of MCA V2 to V3 from January 01, 2023, to January 22, 2023, may file these forms in physical mode duly signed by the persons concerned as per the requirements of the relevant forms along with the copy thereof in electronic-media with concerned Registrar without payment of fee and take acknowledgment.
Such physical filing shall be accompanied by an undertaking from the Company that once the filing of these forms is enabled on the portal, the Company shall file the relevant form in electronic form along with the fees payable as per Companies (Registration Offices and Fees) Rules,2014.
The link for the aforesaid General Circular is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=WsznZ2ZG2R%252BWuZ7rNx7pWA%253D%253D&type=open
3. New formats of Forms related to Directors and their disqualification
On January 20, 2023, MCA vide Notification issued the Companies (Appointment and Qualifications of Directors) Amendment Rules, 2023 effective from January 23, 2023.
In Rule 14 which relates to the disqualification of directors under Section 164(2):
a.a new sub-rule (1A) has been inserted which states that whenever a company receives the information in Form DIR-8 about disqualification, the company shall within 30 days of receipt of DIR-8, file Form DIR-9 with the Registrar.
b.Rule 14(5) is also amended and states that any application for removal of disqualification of directors shall be made in Form DIR-10 and filed before the Regional Director.
MCA notified new format of the following E-forms:
- DIR-3 (Application for allotment of Director Identification Number before appointment in an existing Company or LLP),
- DIR-3C (Intimation of information of directors, managing director, manager, and secretary by an Indian Company),
- DIR-5 (Application for surrender of Director Identification Number),
- DIR-6 (Intimation of change in particulars of Director/ Designated Partner to be given to the Central Government),
- DIR-8 (Intimation by Director),
- DIR-9 (Report by the Company to Registrar for disqualification of Directors),
- DIR-10 (Application for removal of Disqualification of Directors),
- DIR-11 (Notice of the resignation of a Director to the Registrar) and
- DIR-12 (Particulars of appointment of directors and the key managerial personnel and the changes among them).
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=5gAUSA0m%252FLmgaQtCZdCS2Q%253D%253D&type=open
4. Conversion of Partnership Firm, LLP, Trust or Society
On January 19, 2023, MCA vide Notification No. G.S.R. 39(E) issued the Companies (Authorised to Register) Amendment Rules, 2023 effective from January 23, 2023.
In Rule 3(2) relating to the formation of the Company upon conversion of the entity from a partnership Firm / LLP/ Society or Trust following changes are made:
- Need to submit No Objection Certificate from the Secured Creditor along with the Charge holder, if applicable
- No requirement to submit written consent from the majority of members. Whether present in person or by proxy at the general meeting agreeing to such registration.
- No requirement to submit an undertaking that the proposed Directors shall comply with the requirements of the Indian Stamp Act 1899.
MCA notified the new format of E-form URC-1 (Application by a company for registration under section 366—Companies capable of being registered).
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=XkFRyiRIeiGKtDK0myJS9w%253D%253D&type=open
5. New formats of Forms for Dormant companies
On January 20, 2023, MCA vide Notification issued the Companies (Miscellaneous) Amendment Rules 2023 effective from January 23, 2023, and notified new format of the following E-forms:
- MSC-1 (Application to ROC for obtaining the status of the Dormant Company),
- MSC-3 (Return of Dormant Companies), and
- MSC-4 (Application for seeking the status of an Active Company).
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=jLOhNY%252F5Oyn3AHEbkASjzw%253D%253D&type=open
6. New format of Form for intimation to RoC of address at which books of accounts are to be maintained
On January 20, 2023, MCA vide Notification No. G.S.R. 40(E) issued the Companies (Accounts) Amendment Rules, 2023 effective from January 23, 2023, and notified the new format of E-Form AOC-5 (Notice of address at which books of account are to be maintained).
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=URBkg0OQEvExHY9sWlCZbQ%253D%253D&type=open
7. New formats of Forms MGT 14 and MGT 3
On January 21, 2023, MCA vide Notification No. G.S.R. 44(E) issued the Companies (Management and Administration) Amendment Rules, 2023 effective from January 23, 2023, and notified new format of E-Form MGT-3 (Notice of situation or change of situation or discontinuation of situation, of place where foreign register shall be kept) and E-form MGT-14 (Filing of Resolutions and agreements to the Registrar).
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=KzknWVtaIXfLUIGhXKWBJw%253D%253D&type=open
8. Details of the name of any parent or spouse by Foreign Company for its Directors and Secretary
On January 20, 2023, MCA vide Notification No. G.S.R.36 (E) issued the Companies (Registration of Foreign Companies) Amendment Rules, 2023 effective from January 23, 2023, amending the Companies (Registration of Foreign Companies) Rules, 2014 (Original Rules), and notified new formats of a few Forms.
In Rule 3(2) of the Original Rules relating to details of Directors and Secretary to be furnished to the Registrar by the Foreign Companies, in the Forms Foreign Company is required to give details of either father’s name, mother’s name, or spouse’s name. Earlier it was mandatory to give the name of any one parent and spouse’s name.
MCA notified new format of the following E-Forms:
- FC-1 (Information to be filed by a foreign company),
- FC-2 (Return of alteration in the documents filed for registration by a foreign company),
- FC-3 (Annual accounts along with the list of all principal places of business in India established by a foreign company) and
- FC-4 (Annual Return of a Foreign Company).
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=AUcAKkFj6qD9VsQT1arCcQ%253D%253D&type=open
9. New formats of Forms related to the issue of shares
On January 20, 2023, MCA vide Notification No. G.S.R.37(E) issued the Companies (Prospectus and Allotment of Securities) Amendment Rules, 2023 effective from January 23, 2023, and notified new formats of a few Forms.
In the case of the issue of Bonus Shares by the Company, while filing Form PAS -3 being Return of Allotment, there is no need to attach a copy of the shareholder’s resolution authorizing the issue of such bonus shares.
MCA notified new format of the following E-Forms:
- PAS-2 (Information Memorandum),
- PAS-3 (Return of Allotment) and
- PAS-6 (Reconciliation of Share Capital Audit Report).
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=a4r89hvUpe4unaFIE9fhBw%253D%253D&type=open
10. Declaration certifying Buy-Back of Securities as per the Companies Act, 2013 and notification of new formats of Forms
On January 21, 2023, MCA vide Notification issued the Companies (Share Capital and Debentures) Amendment Rules, 2023 effective from January 23, 2023, and notified new formats of a few Forms.
Now in Form SH-11 (Return of Buy-Back of Securities) the requirement of attaching a Form in SH-15 (with verification by a Practicing Professional) is removed and now only a declaration signed by two directors of the Company including the Managing Director, if any, certifying that the buy-back of securities has been made in compliance with the provisions of the Act and the rules made thereunder to be given.
MCA notified new format of the following E-Forms:
- SH-7 (Notice to Registrar of any alteration of share capital),
- SH-8 (Letter of Offer) and
- SH-9 (Declaration of Solvency).
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=%252BMu3w53AFpZ0lGDqnPK8Kw%253D%253D&type=open
11. Simplifications in the Company Incorporation Rules
On January 19, 2023, MCA vide Notification No. 42(E) notified the Companies (Incorporation) Amendment Rules, 2023 effective from January 23, 2023.
The following amendments were made:
A. In Rule 4 relating to the nomination by the Subscriber or Member of One Person Company (OPC), the following changes have been made:
- The name of the person nominated by the subscriber of OPC shall be mentioned in the memorandum and such nomination details along with consent of such Nominee shall be filed in Form No. INC-32 (SPICe+) as a declaration and the said Form along with the fee shall be filed with the Registrar at the time of incorporation of OPC along with its e-memorandum and e-articles.
- Instead of Form INC-3 now Form INC-4 will be required for the following:
i)Intimation by the sole member about the new nominee along with his consent within 15 days of receipt of withdrawal notice from the person nominated by subscriber/member.
ii)The OPC shall within 30 days intimate the written consent of the new nominee to the Registrar.
iii)Subscriber/member by intimation in writing to the OPC change the name of the person nominated along with the reason and nominate another person after obtaining his/her prior consent.
iv)The OPC to file with the Registrar written consent of the new Nominee within 30 days of receipt of intimation of the change.
v)If the sole member ceases to be a member due to death/ incapacity to contract and his nominee becomes a member, then such Nominee to appoint a new member within 15 days of becoming a member and file with the Registrar within 30 days of a change in membership prior written consent of the person nominated.
B. In Rule 6 relating to the conversion of OPC into a Public or Private Company, the following changes have been made:
- The OPC shall file an application for its conversion into a Private or Public Company, other than under section 8 of the Act, in e-Form No. INC-6 with altered e-MOA and e-AOA.
- The Registrar on being satisfied that the requirements have been complied with and after examining the latest audited financial statement approves the e-Form INC-6 and issues a certificate.
C. In Rule 7 relating to the conversion of a Private Company into OPC, the following changes have been made:
- The Private Company for conversion into OPC shall file an application in e-Form No. INC-6 along with fees by attaching the following details or documents:
i)altered e-MOA and e-AOA;
ii)copy of the NOC of every creditor with the application for conversion;
iii)affidavit of directors confirming that all the members of the company have given their consent for conversion. - The Registrar on being satisfied that the requirements have been complied with and after examining the latest audited financial statement approves the e-Form INC-6 and issue a certificate.
D. In Rule 19 relating to the License under Section 8 for new companies with charitable objects, etc, the declaration by an Advocate, a Chartered Accountant, a Cost Accountant, or a Company Secretary in practice and by each of the person making the application is not required in Form INC-14 and INC-15 respectively.
E. In Rule 20 relating to the license application process u/s 8 for existing companies, the following changes have been made:
a.Following documents to be annexed with the application under this Rule:
- The e-Memorandum of Association and e-Article of Association of the Company;
- the declaration by an Advocate, a Chartered Accountant, Cost Accountant, or Company Secretary in practice, that the memorandum and articles of association have been drawn up in conformity with the provisions of section 8 of the Act and rules made thereunder and that all the requirements of the Act and the rules made thereunder or supplemental thereto have been complied with;
- a statement showing in detail the assets (with the values thereof), and the liabilities of the company, as on the date of the application or within 30 days preceding that date;
- the certified copy of the resolution passed in general or board meetings approving registration of the company under section 8 of the Act; and
- a declaration by each of the persons making the application.
b.The Registrar shall after considering 2 years financial statements immediately preceding the date of application or when the Company has functioned only for 1 financial year, for such year including the Board’s Report and Audit Report, relating to the existing companies, and after considering the objections, if any received by it within 30 days from the date of publication of notice, and after consulting any Authority, Regulatory Body, Department or Ministry or of Central Government or the State Government(s), as it may, in its discretion, decide whether the license should or should not be granted.
F. In Rule 21 relating to the conditions and requirements for converting Section 8 Company into a company of any other type, now an intimation along with a copy of the application with annexures as filed in Form INC 18 with the Regional Director is also required to be made to the Registrar through MCA system.
G. In Rule 22 relating to other conditions to be complied with by Companies registered under Section 8 seeking conversion into any other kind, the following changes have been made:
- The Section 8 Company is now required to file the application with a declaration from a practicing Chartered Accountant/ Company Secretary in practice/ Cost Accountant in practice certifying that the conditions laid down in the Act and these rules relating to the conversion of Section 8 Company into any other kind of company, have been complied with.
- On receipt of approval from the Regional Director (RD), inter-alia the Company is now required to file with the Registrar an amended e-Memorandum of Association and amended e-Article of Association of the Company.
H. In Rule 30 relating to shifting of the Registered Office from one State or Union Territory to another State, the following changes have been made:
- Now the copy of the application is only required to be served to the Chief Secretary of the State Government/ Union Territory where the Registered Office is situated and a copy of the acknowledgment of service of a copy of the application with complete annexures to the Chief Secretary is required to be filed with the application.
- The Applicant is not required to submit a separate copy of the application with the Registrar and an intimation of filing of the application in Form no. INC-23 with the Regional Director shall also be shared with the Registrar through the MCA system.
I. In Rule 33 relating to Alteration of Articles, now for effecting the conversion of a public company into a private company, Service Request Number (SRN) of Form No. RD- 1, pertaining to the order of the Regional Director (RD) approving the alteration, shall be mentioned in Form No. INC-27 to be filed with the Registrar along with the fee together with the altered e-Memorandum of Association and e-Article of Association within 15 days from the date of receipt of the order from the RD.
MCA notified new format of the following E-Forms:
- Form RUN (Reserve Unique Name);
- INC-4 (One Person Company- Change in Member/ Nominee);
- INC-6 (One Person Company- Application for Conversion);
- INC- 9 (Declaration by Subscribers and First Directors);
- INC-12 (Application for Grant of License under Section 8);
f.INC-13 (e-Memorandum of Association); - INC-18 (Application to RD for conversion of Section 8 Company into any other kind of company);
- INC- 20 (Intimation to Registrar of revocation/ surrender of the license issued under Section 8);
- INC-2oA (Declaration for Commencement of Business);
- INC-22 (Notice of situation or change of the Registered Office of the Company);
- INC-23 (Application to the Regional Director for approval to shift the Registered Office from one state to another state or from the jurisdiction of one Registrar to another Registrar within the same State);
- INC-24 (Application for approval of Central Government for change of name);
m.INC-27 (Conversion of public company into private company or private company into public company); - INC-28 (Notice of order of the Court or any other competent authority);
- INC-31 (e-Articles of Association);
- SPICE+ (INC- 32) (Simplified Proforma for Incorporating Company electronically Plus);
- INC-33 (SPICe+ MOA)
- INC-34 (SPICe+ AOA)
- INC-35 (AGILE-PRO-S)
- RD-1 (Form for filing an application to Central Government-Regional Director)
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=ePWdYPBEJzswvfrz%252Fkb6og%253D%253D&type=open
12. New format for Returns related to Managerial Personnel (Forms MR 1 & MR 2)
On January 19, 2023, MCA vide Notification No. G.S.R. 41(E) issued the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2023 effective from January 23, 2023, and notified new format of E-Form:
- MR-1 (Return of Appointment of Managerial Personnel) and
- MR-2 (Application to the Central Government for approval of the Appointment of Managing Director/ Whole-Time Director/ Manager).
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=KOPgOjylxvDtUW18%252BOESSA%253D%253D&type=open
13. New format of Forms giving the option to be signed by an Insolvency Resolution Professional or Resolution Professional or Liquidator of Companies
On January 20, 2023, MCA vide Notification No. G.S.R. 45(E) issued the Companies (Registration Offices and Fees) Amendment Rules, 2023 effective from January 23, 2023, and notified new formats of a few E-Forms.
New Rule 8A related to the signing of forms has been inserted which states that e-forms wherever applicable shall be signed by an Insolvency Resolution Professional or Resolution Professional or Liquidator of Companies under insolvency or liquidation, as the case may be, and filed with the Registrar along with the fee as mentioned in the rules.
MCA notified new format of the following E-Forms:
- GNL-2 (Form for submission of documents with the Registrar),
- GNL-3 (Particulars of person(s) charged for the purpose of subclause (iii) or (iv) of clause 60 of section 2) and
- GNL-4 (Form for filing Addendum for rectification of defects or incompleteness).
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=XLgcI1xHIs9Sjmhyk6ogqg%253D%253D&type=open
14. Extension of Time for filing of 45 company e-Forms and Return of Allotment in Form PAS-3 in MCA 21 V3 without additional fees
On February 07, 2023, MCA vide General Circular 03/2023, in continuation of General Circular 1/2023 dated January 09, 2023, allowed further additional time of 15 days for filing 45 e-forms without additional fees, due to a change in way of filing in Version-3, including the fresh process of registration of users on MCA-21 and process of stabilization of 45 forms launched with effect from January 23, 2023.
Form PAS-3 (Return of Allotment) which was closed for filing in Version-2 on January 20, 2023, and launched in Version-3 on January 23, 2023, and whose due dates for filing fall between January 20, 2023, and February 06, 2023, can also be filed without payment of additional fees for a period of 15 days.
The link for the aforesaid General Circular is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=CbgxW1sJmKtaGuYxShWEfA%253D%253D&type=open
15. Extension of time for filing of 45 company e-Forms, Return of Allotment in Form PAS-3, and incorporation documents like Form SPICE+ Part A in MCA 21 V3 without additional fees
On February 21, 2023, MCA vide General Circular 04/2023, in continuation of General Circular 1/2023 dated January 09, 2023, and 3/2023 dated February 07, 2023, allowed further additional time till March 31, 2023, for filing 45 e-forms without additional fees, which are due for filing between February 07, 2023, and February 28, 2023.
Form PAS-3 which was closed for filing in Version-2 on January 20, 2023, and launched in Version-3 on January 23, 2023, and whose due dates for filing fall between January 20, 2023, and February 28, 2023, can also be filed without payment of additional fees till March 31, 2023.
The reservation period for the names (for incorporation or change of company name) which are reserved, is extended by a further period of 20 days. The resubmission period for extension of reservation of names falling between January 23, 2023, and February 28, 2023, is also extended by 15 days.
The link for the aforesaid General Circular is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=2wjQ2Yt5XCZLAoGRr2jfOQ%253D%253D&type=open
16. Physical filing of certain Forms due to migration of MCA Portal from v2 to v3
On February 22, 2023, MCA vide General Circular No. 05/2023 allowed the Companies intending to file the following forms in physical mode from February 02, 2023, to March 31, 2023, to be signed by the persons concerned as per the requirements of the relevant forms along with the copy thereof in electronic media and Undertaking (that once the filing of these forms is enabled on the portal, the Company shall file the relevant form in electronic form along with the fees) with the concerned Registrar without payment of fee and take an acknowledgment.
- GNL-2 (filing of prospectus-related documents and private placement);
- MGT-14 (filing of resolutions relating to prospectus-related documents and private placement);
- PAS-3 (Return of Allotment);
- SH-8 (Letter of Offer for buyback of own shares or other securities);
- SH-9 (Declaration of Solvency) &
- SH-11 (Return in respect of buy-back of securities)
The link for the aforesaid General Circular is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=L1%252FlzzFGRvjYOFmh0PQHAw%253D%253D&type=open
17. Amendments to Indian Accounting Standards
On March 31, 2023, MCA vide Notification No. G.S.R. 242(E) in consultation with the National Financial Reporting Authority (NFRA), issued the Companies (Indian Accounting Standards) (IND AS) Amendment Rules, 2023 which came into effect from April 01, 2023.
This amendment brings about significant changes in IND AS to improve financial reporting, enhance transparency, and align with international standards.
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=1RTpvF4akmqNtzBnz%252Bw8vA%253D%253D&type=open
18. Application to Strike off the names of the Companies now in the Centre and no Jurisdiction to RoC
On April 17, 2023, MCA vide Notification No. G.S.R. 298(E) notified the Companies (Removal of Names of Companies from the Register of Companies) Amendment Rules, 2023, and format of a few e-Forms which shall come into force with effect from May 01, 2023.
The amendment provides as follows:
- An application for the Removal of the name of the Company is to be made to the Registrar, Center for Processing Accelerated Corporate Exit (CPACE), instead of the jurisdictional RoC in Form No. STK-2 along with a fee of Rs. 10,000. CPACE shall have all territorial jurisdiction all over India in this matter.
- No need to file a copy of the special resolution duly certified by each of the directors of the company or consent of 75% of the members of the company in terms of paid-up share capital of the Company.
MCA notified new format of the following E-Forms:
- STK-2 (Application by the company to ROC for removing its name from the register of companies),
- STK-6 (Public Notice) and
- STK-7 (Notice of striking off and dissolution).
The link for the aforesaid Notification is as below:
https://egazette.nic.in/WriteReadData/2023/245244.pdf
19. The Companies (Removal of Names of Companies from the Register of Companies) Second Amendment Rules, 2023
On May 10, 2023, MCA vide Notification No. G.S.R. 354(E) notified “the Companies (Removal of Names of Companies from the Register of Companies) Second Amendment Rules, 2023” which shall come into force on the date of its publication in the Official Gazette.
In continuation of changes for the application for Strike off of the name of the Company, a few clarifications were made that
- the Company to file overdue financial statements and annual returns, up to the end of the financial year in which the company ceased to carry out its business operations;
- the Company to file all pending financial statements and annual returns if any action is initiated by RoC;
- the Company cannot file an application if the notice of strike-off has been issued by the RoC.
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=NayTkLw9l%252BWyjFrBKAUtDQ%253D%253D&type=open
20. Acceleration of Fast Track Merger
On May 15, 2023, MCA vide Notification No. G.S.R. 367(E) notified “the Companies (Compromises, Arrangements, and Amalgamations) Amendment Rules, 2023” which shall come into force with effect from June 15, 2023.
There was no time frame mentioned for RoC or RD to raise the objection for any Scheme of Merger for Fast Track Merger (Merger of Small Companies, Holding- Wholly Owned Subsidiary Companies, etc)
a.Where objection or suggestion is not received within 30 days of receipt of a copy of the Scheme from the RoC/Official Liquidator (OL) and the Central Government (CG) is of the opinion that the scheme is in the public interest then, it may, within 15 days after the expiry of 30 days, issue a Confirmation Order. However, if the CG does not issue a Confirmation Order within 60 days of receipt of the Scheme, it shall be deemed that it has no objection to the Scheme, and a Confirmation Order shall be issued accordingly.
b.Where objection or suggestion is received within 30 days of receipt of a copy of the Scheme from the RoC/OL or both and the same is not sustainable and CG is of the opinion that the scheme is in the public interest/creditors’ interest, then, it may issue a Confirmation Order in 30 days. However, if the CG is of the opinion that the scheme is not in the public interest/creditors’ interest, then, it may apply to the National Company Law Tribunal (NCLT) in 30 days.
c.In case CG neither issues a Confirmation Order nor files any application to NCLT, it shall be deemed that it has no objection to the scheme, and a Confirmation Order shall be issued accordingly.
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=1Wyd8lldgilFPq8Dx6A3QA%253D%253D&type=open
21. Corporate Social Responsibility Reporting
On May 31, 2023, MCA vide Notification No. G.S.R 408(E) notified the Companies (Accounts) Second Amendment Rules, 2023 (“the Amended Rules”) which has amended the Companies (Accounts) Rules, 2014 (“the Original Rules”). The amendment is effective from May 31, 2023.
Rule 12 reads that every company to whom CSR is applicable to furnish a report on CSR in Form CSR-2 to RoC for the preceding financial year (2020-2021) and onwards as an addendum to Form filed for Balance Sheet.
However, since 2020-21 till date due to technical reasons, the said CSR Report is filed separately in Form CSR-2 by the end of the FY that is by 31st March each year, and not as an addendum to Form filed for Balance Sheet in October month.
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=hkjC9jSSH4nRkzYxvO2a5w%253D%253D&type=open
22. Limited Liability Partnership (LLP) – New Format of Form-3
On June 02, 2023, MCA vide Notification No. G.S.R. 411(E) issued the Limited Liability Partnership (Amendment) Rules, 2023, and notified new format of E-Form LLP 3 (Information about Limited Liability Partnership Agreement and changes, if any, made therein) along with additional disclosure requirements as mentioned in the Notification.
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=iiQZzbSNrcRVS%252F9wRBqOew%253D%253D&type=open
23. Notification under Section 14 of the Insolvency and Bankruptcy Code 2016
On June 14, 2023, MCA vide Notification No G.S.R 2660(E) notified that the provisions of Section 14(1) of the Insolvency and Bankruptcy Code, 2016, relating to Moratorium, shall not apply to certain transactions, arrangements, or agreements entered by corporate debtors, namely:
- the Production Sharing Contracts, Revenue Sharing Contracts, Exploration Licenses, and Mining Leases made under the Oilfields (Regulation and Development) Act, 1948 and rules made thereunder; and
- any transactions, arrangements, or agreements, including Joint Operating Agreement, connected or ancillary to the transactions, arrangements, or agreements referred to in clause a.
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=igjGKv5zktdufUjKGZkigA%253D%253D&type=open
24. Relaxation in paying additional fees in case of delay in filing DPT-3 ( Return of Deposits)
On June 21, 2023, MCA vide Circular No. 6/2023 informed relaxation in the payment of additional fees up to July 31, 2023, in case of delay in filing e-Form -DPT-3 (Return of Deposits) for the financial year ending on March 31, 2023.
The last date for filing e-Form DPT-3 is June 30, 2023 however, taking into consideration the shift of the MCA-21 Portal from V2 to V3, this relaxation has been announced by MCA.
The link for the aforesaid Circular is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=GZbzY8G5s24kITjoGKWLQQ%253D%253D&type=open
25. New format of Form RD-1 (for application to Regional Director)
On August 02, 2023, MCA vide Notification No. G.S.R. 584(E) issued the Companies (Incorporation) Second Amendment Rules, 2023 effective from the date of publication in the Official Gazette, and notified the new format of E-Form RD-1 (Form for filing application to Central Government-Regional Director).
The link for the aforesaid Notification is as below:
https://egazette.gov.in/WriteReadData/2023/247850.pdf
26. Condonation Scheme – For delay in filing of Form 3, Form-4, and Form-11 by LLPs
On August 23, 2023, MCA vide Circular 8/2023 introduced a Condonation Scheme (‘the Scheme’) for the delay in filing e-Form-3 (LLP Agreement and alterations), e-Form-4 (Information regarding the appointment, resignation, change in details of a partner), and e-Form-11 (Annual Return of the LLP) under the Limited Liability Partnership Act, 2008 due to various reasons including mismatch in the master data in electronic registry of the Ministry.
These forms shall be available for filing from September 01, 2023, till November 30, 2023 (both dates inclusive) and LLPs availing the scheme shall not be liable for any action for delayed filing of Form 3, Form-4, and Form-11
The basic features of the Scheme are as follows:
a.Form-3 and Form-4
- Will be processed under the Straight Through Process (STP) mode for all purposes, except for changes in business activities.
- If there are multiple amendments pending filing, stakeholders are recommended to submit these forms in sequence, beginning with the earliest events.
- Forms offer editable pre-filled data from current records. Stakeholders are accountable for accurate data; misinformation may lead to adverse consequences.
- No extra fees for Form-3 & Form-4 from January 01, 2021 events. For events dated earlier than January 01, 2021, additional fees will be chargeable (2 times for small LLPs, 4 times for others).
b.Form 11
- No extra fee for filing Form-11 from FY 2021-22 onward.
- Before FY 2021-22, Form-11 can be filed with additional fees i.e. 2 times for small LLPs and 4 times for other LLPs.
The link for the aforesaid Circular is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=Zt6foWsl%252BABAbU7Pid9NGg%253D%253D&type=open
27. New format of Forms 3 and 4 for LLP
On September 01, 2023, MCA vide Notification No. G.S.R. 644(E) issued the Limited Liability Partnership (Second Amendment) Rules, 2023 effective from the date of publication in the Official Gazette, and notified new format of E-Form:
a.Form 3 (Information with regard to the Limited Liability Partnership Agreement and changes if any, made therein) and
b.Form 4 (Notice of appointment, cessation, change in name /address /designation of a designated partner or partner and consent to become a partner /designated partner).
The link for the aforesaid Notification is as below:
https://www.mca.gov.in/bin/dms/getdocument?mds=ywlii5hvZvLABylQ7KmtNA%253D%253D&type=open
28. Extension for holding of AGM/EGM through VC or OAVM
On September 25, 2023, MCA vide Circular No. 09/2023 issued a clarification that companies are allowed to conduct their Annual General Meetings (AGM) and Extra Ordinary General Meeting (EGM) which are due in the year 2023 or 2024 through Video Conferencing (“VC”) or Other Audio-Visual Means (“OAVM”) facilities, on or before September 30, 2024, as per the requirements laid in Circular No. 20/2020 dated May 05, 2020. It is also allowed to transact items through the postal ballot in accordance with the framework provided in the aforesaid Circulars up to September 30, 2024
The link of the aforesaid mentioned circular is as follows:
https://www.mca.gov.in/bin/dms/getdocument?mds=HaKq8Y72SkO5wIQe05fjLQ%253D%253D&type=open
29. Exemption of applicability of Moratorium for the transactions, arrangements, or agreements relating to aircraft, aircraft engines, airframes, and helicopters
On October 03, 2023, MCA notified an amendment under Section 14(3)(a) of the Insolvency and Bankruptcy Code, 2016 (“IBC”), exempting the applicability of Section 14(1) of the IBC to transactions, arrangements or agreements relating to aircraft, aircraft engines, airframes, and helicopters.
This amendment is because India is a signatory to and has acceded to the Convention on International Interests in Mobile Equipment (“Convention”) and the Protocol to the Convention on International Interests in Mobile Equipment on Matters specific to Aircraft Equipment (“Protocol”) under the joint auspices of International Civil Aviation Organization and the International Institute for the Unification of Private Law concluded at Cape Town on November 16, 2001, and having acceded the Convention and the Protocol by depositing with the International Institute for the Unification of Private Law the instruments of accession on March 31, 2008, the exemption of Section 14 (1) of IBC is provided to transactions, arrangements or agreements relating to aircraft, aircraft engines, airframes, and helicopters
The link to the aforesaid Notification is as follows:
https://egazette.gov.in/WriteReadData/2023/249132.pdf
30. Approval to shift the Registered Office of the Company after approval of Resolution Plan
On October 20, 2023, MCA vide Notification No. G.S.R. 790(E) notified the Companies (Incorporation) Third Amendment Rules, 2023, which shall come into force with effect from October 21, 2023.
According to the amendment the Company where the management has been taken over by new management under a Resolution Plan approved u/s 31 of IBC is permitted to shift its Registered Office, subject to two conditions:
(a)No appeal against the Resolution Plan is pending in any Court or Tribunal; and
(b)No inquiry, inspection, or investigation is pending or initiated after the approval of the said Resolution Plan
The link to the aforesaid Notification is as follows:
https://www.mca.gov.in/bin/dms/getdocument?mds=uqnggXxHARXXjysr4uSRjQ%253D%253D&type=open
31. Mandated Dematerialized form in making issuance and approval of transfer by all Private Companies
On October 27, 2023, MCA vide Notification No. G.S.R. 802(E) notified the Companies (Prospectus and Allotment of Securities) Second Amendment Rules, 2023 (“Amended Rules”), which has been effective from the same date.
The amendments are made with respect to:
a.issued share warrants under the erstwhile Companies Act, 1956; and
b.issue of securities in dematerialised form by private companies excluding small companies and government companies.
The link to the aforesaid Notification is as follows:
https://egazette.gov.in/WriteReadData/2023/249772.pdf
32. Maintenance of Register of Partner and Declaration with respect to Beneficial Interest by Limited Liability Partnership (LLP)
On October 27, 2023, MCA vide Notification No. G.S.R. 803(E) notified the Limited Liability Partnership (Third Amendment) Rules, 2023 (Amended Rules), which has been effective from the same date.
According to the amendment, Rule 22A and Rule 22B are inserted about:
- Every LLP shall, from the date of its incorporation, maintain a register of its partners in Form 4A which shall be kept at the registered office of the LLP;
- LLP to give a declaration in respect of a beneficial interest in any contribution.
The link to the aforesaid Notification is as follows:
https://www.mca.gov.in/bin/dms/getdocument?mds=VYVpE7YcJovnhBqcW9gtsw%253D%253D&type=open
33. Appointment of a Designated Person to provide information regarding beneficial interests in the Company’s shares
On October 27, 2023, MCA vide Notification No. G.S.R. 801(E) notified the Companies (Management and Administration) Second Amendment Rules, 2023, which has been effective from the same date.
According to the amendment under Rule 9 (Declaration in Respect of Beneficial Interest in Any Shares) of the Companies (Management and Administration) Rules, 2014 five new sub-rules are introduced stating:
- The Company to designate a responsible personfor providing information to the Registrar or any authorized officer regarding beneficial interests in the company’s shares;
- The Company has the option of designating a responsible person, which may include a company secretary, key managerial personnel (other than the company secretary), or every director(if there is no company secretary or key managerial personnel);
- Until a responsible person is designated, the company secretary, key managerial personnel (other than the company secretary), or every director (if there is no company secretary or key managerial personnel) are deemed to have been designated;
- Every company is to inform in the Annual Return, the details of the designated person; and
- In case of any change in designated person,the Company is to intimate the Registrar
The link to the aforesaid Notification is as follows:
https://www.mca.gov.in/bin/dms/getdocument?mds=lVo7Nz8E9SMEBo5r07okJw%253D%253D&type=open
34. Direct listing of securities in Overseas Stock Exchange
On October 30, 2023, MCA vide Notification No. G.S.R. 4744(E) notified Section 5 of the Companies Amendment Act 2020 (which is Section 23(3) and (4) of the Companies Act, 2013 relating to Public Offer and Private Placement). This notification has been made effective from the same date.
Central Government may allow certain classes of public companies
- To issue securities for the purposes of listing on permitted stock exchanges in certain permissible foreign jurisdictions.
- Exempt such public companies from the provisions of
- Chapter III on Prospectus and Allotment of Securities
- Chapter IV on Share Capital and Debentures
- Sections 89 & 90 – Beneficial Interest & Significant Beneficial Owner
- Section 127 on Punishment for failure to distribute dividends
The Finance & Corporate Affairs Minister Nirmala Sitharaman had recently said the government is currently focused on enabling direct listing of Indian companies in GIFT City before looking at allowing them to list directly overseas.
Three Regulators MCA, SEBI, and RBI work on a unified Code and many issues need to be ironed out Class of Companies, Types of Securities, Jurisdiction, Exemption from domestic compliance, Regulation, Taxation, Reporting & related Compliances, Infrastructure and Role of Intermediaries
Pros and cons of Direct Listing Overseas or at the GIFT CITY
-ve – Costs like listing costs, stock exchange fees, compliance costs
-ve – Dual compliances if the company needs to comply with domestic laws also
+ve – Diversified Investor base
+ve – Better valuation, where the risk appetite is high
+ve – More visibility to Indian companies, Expansion to international market
+ve – It allows giving exit to PE and VC funds
+ve – It boosts the economy as capital will be available locally for other sectors
+ve – For technology-driven companies, companies in the health sector, new-age solution providers, Drone manufacturing companies & Nano Technology companies will get global reach,
The link to the aforesaid Notification is as follows:
https://www.mca.gov.in/bin/dms/getdocument?mds=fIA9%252BFLpJeScxnEXI0xncQ%253D%253D&type=open
34. Direct listing of securities in Overseas Stock Exchange
On October 30, 2023, MCA vide Notification No. G.S.R. 4744(E) notified Section 5 of the Companies Amendment Act 2020 (which is Section 23(3) and (4) of the Companies Act, 2013 relating to Public Offer and Private Placement). This notification has been made effective from the same date.
Central Government may allow certain classes of public companies
- To issue securities for the purposes of listing on permitted stock exchanges in certain permissible foreign jurisdictions.
- Exempt such public companies from the provisions of
- Chapter III on Prospectus and Allotment of Securities
- Chapter IV on Share Capital and Debentures
- Sections 89 & 90 – Beneficial Interest & Significant Beneficial Owner
- Section 127 on Punishment for failure to distribute dividends
The Finance & Corporate Affairs Minister Nirmala Sitharaman had recently said the government is currently focused on enabling direct listing of Indian companies in GIFT City before looking at allowing them to list directly overseas.
Three Regulators MCA, SEBI, and RBI work on a unified Code and many issues need to be ironed out Class of Companies, Types of Securities, Jurisdiction, Exemption from domestic compliance, Regulation, Taxation, Reporting & related Compliances, Infrastructure and Role of Intermediaries
Pros and cons of Direct Listing Overseas or at the GIFT CITY
-ve – Costs like listing costs, stock exchange fees, compliance costs
-ve – Dual compliances if the company needs to comply with domestic laws also
+ve – Diversified Investor base
+ve – Better valuation, where the risk appetite is high
+ve – More visibility to Indian companies, Expansion to international market
+ve – It allows giving exit to PE and VC funds
+ve – It boosts the economy as capital will be available locally for other sectors
+ve – For technology-driven companies, companies in the health sector, new-age solution providers, Drone manufacturing companies & Nano Technology companies will get global reach,
The link to the aforesaid Notification is as follows:
https://www.mca.gov.in/bin/dms/getdocument?mds=fIA9%252BFLpJeScxnEXI0xncQ%253D%253D&type=open
35. The Limited Liability Partnership (Significant Beneficial Owners) Rules, 2023
On November 09, 2023, MCA vide Notification No. G.S.R. 832(E), notified “the Limited Liability Partnership (Significant Beneficial Owners) Rules, 2023” (“the Rules”) which came into effect immediately on November 09, 2023. Section 79 of the Limited Liability Partnership Act, 2008, directs regulation and identification of Significant Beneficial Owners (SBO) in LLPs and such individuals to make a declaration in Form No. LLP BEN-1.
An SBO concerning a Reporting LLP entity is an individual who whether acting alone or through one or more persons or trusts, indirectly or together with any direct holdings exceeding 10% of:
- The contribution or
- The voting rights in respect of the management or policy decisions or
- The right to receive or participate in distributable profits, or any other distribution, or
- The right to exercise or actually exercise, significant influence or control in the Reporting LLP.
However, any individual directly holding any right or entitlement exceeding 10% of (a) to (d) mentioned above is not an SBO.
SBO varies depending on the Partner of the Reporting LLP, whether a Body Corporate or LLP or HUF or Partnership Firm or Pooled Investment vehicle. The Rules provide details how to identify SBO for such entities which are Partners of Reporting LLP
The Rule applies to all the LLPs and it provides the following:
- Definitions are provided in the Rule like control; majority stake; SBO; significant influence; ultimate holding company, etc. (Rule 3)
- the Reporting LLP must take necessary actions in identifying the SBO and causing such individuals to file Form No. LLP BEN-1. (Rule 4)
- The SBO is to submit Form LLP BEN-1 to the LLP within 90 days of the commencement of the Rule and in case of changes in the SBO, within 30 days of the change (Rule 5)
- Upon receipt of the declaration from SBO, the Reporting LLP is to file a return in Form No. LLP BEN-2 with the Registrar. (Rule 6)
- The LLP to maintain a register of SBO in Form No. LLP BEN-3 and keep it open for inspection during business hours for such reasonable time as mentioned in the Rules. (Rule 7)
- Form No. LLP BEN-4 is a notice from Reporting LLP to its Partner seeking information about SBO. (Rule 8)
- Reporting LLP is mandated to make an application to the Tribunal under certain circumstances. (Rule 9)
- Exemptions are provided in the Rules to certain entities. (Rule 10)
The link to the aforesaid Notification is as follows:
https://www.mca.gov.in/bin/dms/getdocument?mds=pJZaasqhxL5W9F46Ukp5lw%253D%253D&type=open