Page 35 - Banking Finance June 2017

ARTICLE

The Act introduces significant changes in the provisions re-
lated to governance, e-management, compliance and en-
forcement, disclosure norms, auditors, mergers and acqui-
sitions, class action suits and registered valuers. The act is
now in force w.e.f. 1st April 2014.There are more than 450
+ sections, 7 schedules and 29 chapters.

Highlights of Companies Act 2013

Y Immediate Changes in letterhead, bills or other official
communications, as if full name, address of its regis-
tered office, Corporate Identity Number (21 digit num-
ber allotted by Government), Telephone number, fax
number, Email id, website address if any.

Y One Person Company (OPC): It's a Private Company
having only one Member and at least One Director. No central government. Directors who already have DIN
compulsion to hold AGM. Conversion of existing private need not take any action. Directors not having DIN
Companies with paid-up capital up to Rs 50 Lacs and should initiate the process of getting DIN allotted to him
turnover up to Rs 2 Crores into OPC is permitted. and inform companies. The Company, in turn, has to
Y Woman Director: Every Listed Company /Public Com- inform registrar.
pany with paid up capital of Rs 100 Crores or more / Y Financial year- Under the new Act, all companies have
Public Company with turnover of Rs 300 Crores or more to follow a uniform Financial Year i.e. from 1st April to
shall have at least one Woman Director. 31st March. Those companies which follow a different

Y Resident Director: Every Company must have a direc- financial year have to align their accounting year to 1st
tor who stayed in India for a total period of 182 days or April to 31st March within 2 years. It is desirable to do
more in previous calendar year. the same as early as possible since most the compliances
are on financial year basis under the new Companies
Y Accounting Year: Every company shall follow uniform
Act.
accounting year i.e. 1st April -31st March.
Y Appointment of Statutory Auditors- Every Listed Com-
Y Loans to director - The Company CANNOT advance any
pany can appoint an individual auditor for 5 years and
kind of loan / guarantee / security to any director, Di-
a firm of auditors for 10 years. This period of 5 / 10 years
rector of holding company, his partner, his relative, Firm commences from the date of their appointment. There-
in which he or his relative is partner, private limited in
fore, those companies have reappointed their statutory
which he is director or member or any bodies corpo-
auditors for more than 5 / 10 years; have to appoint
rate whose 25% or more of total voting power or board another auditor in Annual General Meeting for year
of Directors is controlled by him.
2014.
Y Articles of Association- In the next General Meeting, it
Y Dormant Company- The Companies Act, 2013 introduces
is desirable to adopt Table F as standard set of Articles
a concept of a dormant company within its ambit, the
of Association of the Company with relevant changes
concept is defined as where a company is formed and
to suite the requirements of the company. Further, ev-
registered under this Act for a future project or to hold
ery copy of Memorandum and Articles issued to mem-
an asset or intellectual property and has no significant
bers should contain a copy of all resolutions / agree-
accounting transaction, such a company or an inactive
ments that are required to be filed with the Registrar.
company may make an application to the Registrar in
Y Disqualification of director- All existing directors must such manner as may be prescribed for obtaining the
have Directors Identification Number (DIN) allotted by status of a dormant company.

BANKING FINANCE | JUNE | 2017 | 35

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