The Companies (Amendment) Bill, 2014 was introduced by MCA to overcome the deficit in the Companies Act 2013. The approval of the Amendment Bill by the High Court during this month brought clarity in various provisions, boosted many startups to emerge, deal with other stressful provision and not to forget that penalty provisions made more stringent.    Startups spread your wings to fly high with less restriction in Companies Act!! The Government has notified the amendments to the Companies Act, 2013. In our previous article, One step closer to ease of doing business.. Companies Amendment Bill gets passed, we mentioned all the basic amendments introduced in the said Bill. The key highlights of the amendment were:

• No minimum capital required for incorporating a public or private sector company.
• Board Resolution shall no more be a public document.
• Common seal of a company is not required. Now, the authorization shall be made by two directors or by a director and the Company Secretary, wherever the company has appointed a Company Secretary.
• Dividends- No company shall declare dividend unless carried over previous losses and depreciation not provided in previous year or years are set off against profit of the company for the current year.
• The unclaimed dividend not to be transferred to Investor Education and Protection Fund.
• Acceptance of deposits by the companies– In contravention with regulations, if a company fails to repay the deposit or any interest due thereon within the time specified, then it will be punishable with fine which shall not be less than Rs 1 crore but which may extend to Rs 10 crore” in addition to payment of deposits.

            In addition to this, every officer of the company who is in default shall be punishable with imprisonment,                   which may extend to seven years or with fine, which shall not be less than Rs 25 lakh but that may extend to Rs             2 crore, or with both. These amendments are now part of the Companies Act 2013. For sure, the changes are for betterment of startups and shall encourage them to emerge and fly high without much restriction. The scope for startups is expanding so that they put forward with the extravagant innovations and ensures that they do not have to face the closure phase. May be slowly but startups have started to spread their wings. With coming of all amendments, it seems that Modi Government is fully on the side of startups to encourage and support them in all possible ways. Such steps are expected to bring the Indian law in tune with the global standards. Startups feel free to contact us at:  https://taxmantra.com/company-registration/ _________________________________________________________________________________________