COMPANY LAW AMENDMENTS
PERTAINING TO
THE COMPANIES ACT-2013
FOR
NOVEMBER-2014 EXAM
ICAI-CA FINAL
IMPLIMENTED IN PHASED MANNER
APPLICABLE FOR FIRST TIME IN NOV-2014
CA FINAL EXAM
No. of Sections
|
When become effective?
|
Reference to section no.
|
1 Section
|
30/08/2013
|
Section:1
|
45 Sections
|
12/09/2013
|
Total 98
Sections notified
|
7 Sections
|
01/04/2014
|
Sec.128
to 138 (excluding sec.
130,131,132-not
notified)
(sec.133
notified on 12/09/2013)
|
10 Sections
|
01/04/2014
|
Sec.139
to 148
|
Total
Sections 62
(Excluding Section one)
|
||
RULES AND
DEFINITIONS
THE
COMPANIES (ACCOUNT) RULES,2014
THE
COMPANIES (AUDIT & AUDITOR) RULES,2014
THE
COMPANIES(CSR POLICY) RULES,2014
SOME
DEFINITION IN SECTION 2 THE COMPANIES ACT 2013 WILL ALSO BE USEFUL
SCOPE OF THE PRESENTATION
CHAPTER WISE EFFECT OF THE COMPANIES
ACT, 2013
NEWLY INSERTED PROVISIONS
&
AMENDED PROVISIONS
THE
COMPANIES ACT, 2013
CHAPTER WISE EFFECT
CHAPTERS OF COMPANY
LAW
1.
BOARD MEETINGS
|
11. INSPECTION AND INVESTIGATION
|
2.
POWER OF BOARD OF DIRECTORS
|
12. COMPROMISE& ARRANGEMENT(CA-1956)
|
3.
APPOINTMENT & QUALIFICATION OF
DIRECTORS
|
13. OPPRESSION & MISMANAGEMENT (CA-1956)
|
4. RELATED PARTY
TRANSACTIONS
|
14. GOVERNMENT COMPANIES
|
5. APPOINTMENT OF
MANAGERIAL PERSON & REMUNERATION OF DIRECTOR
|
15. FOREIGN COMPANIES
|
6. ACCOUNTS
|
16. PRODUCER COMPANIES (CA-1956)
|
7. AUDIT
|
17. MISCELLANEOUS PROVISIONS
|
8. DIVIDEND
|
18. WINDING UP (CA-1956)
|
9. SOLE SELLING AGENTS
(CA-1956)
|
19. REVIVAL & REHABILITATION OF SICK COMPANY (NOT
APPLICABLE)
|
10. INTER CORPORATE
LOAN & INVESTMENT
|
20. SECRETARY & SECRETARIAL PRACTICES
|
Chapter Wise –
Provisions of CA-2013
Name of Chapter No of Sections of CA-2013
·
Chapters relating to Directors
|
13 Sections
|
·
Foreign company
|
4 Sections
|
·
Accounts
|
8 Sections
|
·
Audit
|
10 Sections
|
·
Miscellaneous Provisions
|
24 Sections
|
·
Dividend
|
1 Section
|
·
Inspection & Investigation
|
1 Section
|
·
Government company
|
1 Section
|
·
Total Section
|
62
|
THE COMPANIES ACT, 2013
CHAPTERS PERTAINING TO“DIRECTORS”
TOTAL 13 SECTIONS
Types of change Section Number
New sections Sec.192,
194, 195
Section
involving major changes Sec.
161, 180, 185
Minor
changes in section Sec.
181, 182, 183
Remaining
sections Sec.
162,163,176, 202
BOARD MEETING
Section 290 of the
Companies Act, 1956 has been replaced by
Section 176 of the
Companies Act, 2013
(No change in provision
as such)
All other provision of this Chapter
are applicable as per
The Companies Act, 1956
POWER OF BOARD OF
DIRECTORS
Old
Section
|
New
Section
|
Topic
|
Glimpses
of changes
|
193(1)(e)
|
181
|
Contribution to bonafied Charitable
and Other Fund
|
·
Now provision
is also applicable to private co.
·
Limit remains
same as 5% of average Net Profit of Last 3 years.
However, limit of Rs.50000 now Dropped.
·
Now
contribution relating to business of company and relating to welfare of
employees are not excluded from limit.
·
Approval of
members required by way of prior ordinary resolution.
|
293(1)(a)
To
293(1)(d)
|
180
|
Restriction on power of BOD
|
·
Now provision
is also applicable to private co.
·
Section
provides Definition of “Undertaking” (i.e. investment exceeding 20% of net worth
or income exceeding 20%) & “Substantially the Whole of Undertaking” (i.e.
more than 20% of value of undertaking).
Instead
of Compensation for compulsory acquisition of assets, now Compensation Merger
& Amalgamation, term is used in earlier 293(1)-new section 180(1)(b).
Member
approval required is by way of Special resolution instead of Ordinary
resolution.
|
293A
|
182
|
Contribution to political party
|
·
Limit of
political contribution is now 7.5% average net profit of preceding 3
financial years instead of 5%.
·
Punishment:
Fine on Co. up to 5 times of contribution.
·
Director is
liable with ≤ 6
months
Imprisonment
and 5 times of such amount contributed (continues to be Non Compoundable
offence).
|
293B
|
183
|
Contribution to National Defense fund
|
·
No significant
change in the provision.
|
RELATED PARTY
TRANSACTIONS
Old
section
|
New
section
|
Topic
|
Glimpses
of changes
|
295
|
185
|
Loan to directors
|
·
Exemption to
private company withdrawn
·
Approval of CG
dispensed with rather prohibition imposed
·
Loan to MD/WTD
as per condition of service can be made or can be made as per Scheme approved
by the members of the company by way of special resolution
·
Exemption of
loan/Guarantee by holding co to subsidiary co withdrawn however rules provide
for such exemption with some different wordings
·
Loan in the
ordinary course of business at a Rate of interest>RBI rate shall be
exempted
·
Contravention
than fine on co ≥ 5lakhs
but ≤
25lakhs
And
·
Additionally
Director is liable for 6 months imprisonment or fine ≥ 5lakhs which may be ≤ 25lakhs Or Both
|
APPOINTMENT &
QUALIFICATION OF DIRECTOR
Old section
|
New section
|
Topic
|
Glimpses of changes
|
260
|
161(1)
|
Additional
director
|
·
A person who
fails to get appointed as director in the meeting of the company can’t be
appointed as additional director
·
Additional
Director holds office up to next A.G.M. should have been held, whichever is
earlier
|
313
|
161(2)
|
Alternative
director
|
·
Word/Concept
“Out of the State” replaced by “Out of India”
·
One person can
hold only one alternative directorship
Any position of independent director can be filled
by only a person who has capacity to be appointed as Independent director in
the said company
|
NIL
|
161(3)
|
Nominee director
|
·
Nominee
director can be Appointed be BOD subject to AOA of the company
|
262
|
161(4)
|
Casuals vacancy
Director
|
·
No Change
|
OTHER PROVISION OF
CA-2013 RELATING TO DIRECTORS
Old section
|
New
section
|
Topic
|
Glimpses
of changes
|
263
|
162
|
Appointment of directors voted
individually
|
·
Now provision
is also applicable to private company
·
Contravention
than fine ≥5
thousand but ≤ 5lakh
|
265
|
163
|
Proportional Representation
|
·
Now provision
is also applicable to private company
|
318
|
202
|
Compensation for lost of office
|
·
No change in
provision
|
NEWLY INSERTED
PROVISIONS IN THE CHAPTER OF DIRECTOR
·
Section
192: NON CASH TRANSACTIONS INVOLVING DIRECTOR
·
Section
194: PROHIBITION OF FORWORD DEALING IN SECURITIES
·
Section
195: PROHIBITION OF INSIDER TRADING
ACCOUNT
New
section
|
Companies Act, 2013
|
Old
section
|
Companies Act, 1956
|
Chapter-IX
Accounts of Companies
Section 128 to 138
|
Part VI- Chapter-1
Accounts of Companies
Section 203 to 233
|
||
128
|
Books of accounts etc., to be kept by
company
|
209
214
|
Books of accounts to be kept by
company
Rights of the holding co.
representatives and members
|
129
|
Financial statement
|
210
211
212
|
Annual accounts and balance sheet
Form and contents of balance sheets
and profits and loss account
Particulars of Subsidiary Companies
|
133
|
Central government to prescribed
accounting standards
|
211(3A)to
211(3C)
|
Form and contents balance sheet &
profit and lass- Accounting Standards
|
134
|
Financial statement, board report
|
215
216
217
218
|
Authentication of financial statements
Profit and loss account to be annexed
and Auditors report to be attach to B/S
Directors’ Report
Penalty for improper issue
circulation, publication of B/S AND P&L
|
135
|
Corporate social responsibility
|
Nil
|
No old provision
|
136
|
Rights of members to copies of audited
financial statements
|
219
|
Rights of members to copies of B/S and
Auditors report
|
137
|
Copy of financial statements to be
filed with Registrar
|
220
|
Three copies of B/S etc. to be filed
with Registrar
|
138
|
Internal audit
|
Nil
|
No old provision
|
AUDIT
New
section
|
Companies
Act, 2013
|
Old
section
|
Companies
Act, 1956
|
Chapter X
Audit And Auditors
Sec.139-Sec.148
|
Part IV Chapter-1
Audit And Auditors
Sec.224-Sec.233B & Sec.619
|
||
139
|
Appointment of auditors
|
224
619
|
Appointment and remuneration of
auditors
Applicable of sec.224 to 133 to
government companies
|
Nil
|
Nil
|
224A
|
Power of Central Government to direct
special audit in certain cases
|
140
|
Removal, resignation of auditor giving
of special notice
|
225
|
Provision as to resolution for
appointing or removing auditors
|
141
|
Eligibility, qualification and
disqualification of auditors
|
226
|
Qualification and disqualification of
auditors
|
142
|
Remuneration of auditors
|
224(B)
|
Appointment and remuneration of
auditors
|
143
|
Power and duties of auditor and
auditing standards
|
227
619
|
Power and duties of auditor
Application of sec.224 to 233 to
government companies
|
144
|
Auditor not to render certain services
|
Nil
|
No old provision
|
146
|
Auditor to attend GM
|
231
|
Rights of auditor to attend GM
|
147
|
Punishment of contravention
|
232
233
|
Penalty for non- compliance with
sec.225,231
Penalty for non-compliance by auditor
with sec.227 and 229
|
DIVIDEND
Old
section
|
New
section
|
Topic
|
Glimpses
of change
|
207
|
127
|
Punishment for declaration of
dividends
|
Imprisonment is reduced to 2 years
from 3 years
|
Note: All other provision of
Companies Act, 1956 (no change as such in other provision).
SOLE SELLING AGENTS
There
is no chapter of sole selling agent in the Companies Act, 2013 therefore, the
same will form part of syllabus till the Companies Act,1956 remains in force
and unless specifically clarified by the ICAI.
INTER CORPORATE LOANS AND
INVESTMENTS
Section
186 of the Companies Act, 2013 not applicable for November, 2014 exam. Hence,
Section 372A of the Companies Act, 1956 continues to be applicable for Nov-14
exam.
INSPECTION &
INVESTIGATION
Old
section
|
New
section
|
Topic
|
635AA
|
457
|
Non-Disclosure of information in
certain cases.
|
Note: All other provision of
Companies Act, 1956 (no change as such in other provision).
COMPROMISES,
ARRANGEMENTS AND AMALGAMATION OF COMPANY
The
provisions of Companies Act, 2013 pertaining to this Chapter are yet to be
notified. Hence, this chapter is to be done as per the Companies Act, 1956
only.
OPPRESSION AND
MISMANAGEMENT
The
provisions of Companies Act, 2013 pertaining to this Chapter are yet to be
notified. Hence, this chapter is to be done as per the Companies Act, 1956
only.
GOVERNMENT COMPANIES
Old
section
|
New
section
|
Topic
|
Glimpses
of change
|
619A
|
394
|
Annual report on government companies
|
No effective changes
|
Note: All other provision of Companies
Act, 1956 (no change as such in other provision).
FOREIGN COMPANIES
Old
section
|
New
section
|
Topic
|
Glimpses
of changes
|
591
|
2(42)
|
Meaning of foreign company
|
Now foreign company doing business
activity in India in any manner and present in India through electronic mode
is regarded as foreign company
|
591
|
379
|
Application of act to foreign
companies
|
No effective change
|
595
|
382
|
Foreign companies to state certain
Particulars- display of name etc.
|
No effective change
|
596
|
383
|
Services on foreign companies
|
Document can be served through
electronic mode.
|
PRODUCER COMPANIES
Section 581A to 581ZT of the Companies Act,
1956 continue to be effective No provision of Companies Act, 2013 relating to
Producer companies Hence, deal with this chapter from the Companies Act, 1956
as it is.
WINDING UP
The provision of Companies Act, 2013
pertaining to this Chapter are yet to be notified. Hence, this chapter is to be
done as per the Companies Act, 1956 only.
The Companies (second) Amendment Act, 2002 has
not come into effect and hence not applicable.
ICAI
has clarified that for November-2014 only Section 528 to Section 560 of the
Companies Act, 1956 are in the syllabus.
REVIVAL AND
REHABILITATION OF SICK COMPANIES
This
chapter is not in the syllabus for November-2014 exam as per clarification of
ICAI.
Provision
of Companies Act, 2013 not made effective.
However,
you may do the Meaning of sick Company for reference purpose
SECRETARY AND
SECRETARIAL PRACTICE
Drafting
of resolution pertaining to new provision to be done as per applicable new
provision of the Companies act, 2013.
Otherwise,
drafting to be done as per Companies Act, 1956.
MISCELLANEOUS
PROVISIONS
Old section
|
New section
|
Topic
|
Glimpses of change
|
621
|
439
|
Offence to be Non-cognizable
|
No effective change
|
637B
|
460
|
Condonation of delay in certain
cases
|
No effective change
|
629
|
450
|
Punishment where no special penalty or
punishment provided
|
Now penalty is 10,000 and further
1,000 per day in case of default continues
|
Nil
|
451
|
Punishment in case of repeated default
|
If the same type of offence committed
within 3 years then punishment by way of fine will be twice the amount of
fine in addition to imprisonment
|
630
|
452
|
Penalty for wrongful withholding of
property
|
No effective change
Punishment will be ≥1lakh up to ≤5lakhs
|
Nil
|
447
|
Punishment for fraud
|
·
Term “fraud”
has been defined
·
Punishment for
fraud imprisonment ≥6
months ≤10 years AND fine ≥ amount of fraud but ≤3 time
of amount of fraud
·
When public
interest is involved imprisonment ≥3 years
|
628
|
448
|
Punishment for false statement
|
Any person provided false statement,
omits material facts, he may be liable for punishment u/s 447
|
629
|
449
|
Punishment for false evidence
|
If any person intentionally givens
false evidence (upon examination on oath or in affidavit etc.) Then may be
punishable with imprisonment of ≥ 3 years but
≤7 years & fine 10,00,000/Rs
|
633
|
463
|
Power of court to grant relief in
certain cases
|
No effective change
|
631
|
453
|
Punishment for improper use of limited
or private limited
|
Not important
|
635A
|
456
|
Protection of action take in good
faith
|
Not important
|
637
|
458
|
Delegation by CG of its power and
functions
|
Not important
|
637A
|
459
|
Power of CG or tribunal to accord
approval etc., subject to condition and prescribed fees on application
|
Not important
|
638
|
461
|
Annual report by CG
|
Not important
|
Nil
|
462
|
Power to exempt class or classes of
companies to provision of act
|
Not important
|
641
|
467
|
Power of CG to amended scheme
|
Not important
|
643
|
468
|
Power of CG to make rule relating to
winding up
|
Not important
|
642
|
469
|
Power of CG to make rules
|
Not important
|
Nil
|
470
|
Power to remove difficulties
|
Not important
|
624A
|
443
|
Power of CG to appoint company
prosecutors
|
Not important
|
624B
|
444
|
Appeal against acquittal
|
Not important
|
Nil
|
445
|
Compensation to accusation without
reasonable cause
|
Not important
|
626
|
446
|
Application of fines
|
Not important
|
615
|
405
|
Power of CG to direct company to ask
company to furnish information or statistic
|
Not important
|
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