The Ministry of Corporate Affairs (MCA) has constituted a committee for finalizing the Business framework of the updated NVGs.
The Institute of Company Secretaries of India (ICSI) & Indian Institute of Corporate Affairs (IICA) shall render necessary secretarial assistance and logical support to the committee on BRR. MCA & ICSI shall jointly provide technical support to the committee.
The committee may devise its own procedure to conduct its meetings including inter alia invite any person of appropriate standing, knowledge, and expertise in the fields of economics, law, banking, social work, etc. and is free to meet anywhere in India.
Cabinet approves of ordinance to bring amendments to Companies Act
The Union Cabinet has approved of ordinance to bring amendment to the Companies Act, 2013. The amendments are proposed to be in line with recommendations of a panel headed by Corporate Affairs Secretary Injeti Srinivas. The ordinance will now be sent for Presidential assent. The proposed amendments include capping fees of independent directors while reducing penalties for minor violations including some related to technical defaults and corporate governance. The contraventions, such as non-disclosure by a director regarding an interest in a contract or an agreement are proposed to be treated as a serious offence. The ordinance shall also cover provisions to decriminalise several offences (about 80) under the Companies Act, steps to improve independence of independent directors and bring measures to curb shell companies besides help de-clog the National Company Law Tribunal.
Government unveils National Financial Reporting Authority Rules, 2018
The Government lays down NFRA Rules, 2018. The rules shall be applicable on all listed Companies and other specified classes of companies. The Rules prescribes functions and duties of the Authority. It requires specified auditors to file annul return with the authority on or before 30th April year. Now NFRA shall receive recommendations from ICAI on proposals for new accounting and auditing standards.
MCA amends companies registered valuers and valuation rules 2017
The Ministry of Corporate Affairs (MCA) has amended the Companies (Registered Valuers and Valuation) Rules, 2017 wherein new proviso has been inserted which explicates that the rules shall apply for valuation in respect of any property, stocks, shares, debentures, securities or goodwill or any other assets or net worth of a company or its liabilities under the provision of the Act or these rules.
Finmin, Sebi Look for Ways to Step up FPI Inflows
Amid a slowdown in foreign investment in stocks and bonds, the finance ministry has called a meeting this week with leading foreign banks that serve as custodians of foreign portfolio investors (FPIs).
Foreign fund managers have sold securities worth more than Rs. 1 lakh crore since April as oil prices hardened and the local currency dipped.
However, it’s widely felt in the financial market that besides international developments and macro-economic uncertainties, the restrictions brought in by the Reserve Bank of India (RBI) on FPI investments in corporate bonds has deepened the selloff in bonds.
Key takeaways from Companies (Amendment) Ordinance, 2018
In order to strengthen the regulatory framework, The Government takes Ordinance route to bring amendment to the Companies Act, 2013. The key takeaways have been discussed hereunder:
Central Govt. gets the power to change the financial Year
Receipt of Share Money and Verification of Address must to obtain certificate of commencement
Physical verification of registered office
Time for registration and modification of charges
Hike in penalty for not appointing Key Managerial Personnel
Removal of imprisonment provision for certain defaults
Penalty of Rs. 5,000 for failure to issue statement along with notice about voting by proxy
Penalty of Rs. 500 per day on non-filing of resolutions and agreements to ROC
Corporate Social Responsibility – Corporate Law Perspective
Section 135(5) of Companies Act, 2013 use words “Board shall ensure that company spends”, therefore the word ‘shall’ shows the intention of the legislature to make CSR provision a mandatory provision.
CSR- Corporate Social Responsibility the term in itself imposes a social responsibility on corporates. Therefore, it is a kind of duty or responsibility of companies, now question arise can violation of social duty/responsibility ever attracts penal consequences?
Use of words “shall ensure that company spends” in Section 135 of Companies Act, 2013 it becomes mandatory for the CSR eligible companies to spend the prescribed amount, failure of which shall attract penal action unless the regulatory authority accepts the reasons given in the report.
Recently, the Government has constituted the High Level Committee on Corporate Social Responsibility – 2018 (HLC-2018) for reviewing the existing framework and guide and formulate the roadmap for a coherent policy on CSR.
