There are various amendments to the Companies Act 2013 which the Government has notified. These amendments facilitate workings of the company. Some of the major amendments notified by the Government in 2019 are:
(a) Decriminilisation of offences: The offences of minor nature and omissions were getting compounded with severe penalties.Through the amendment such minor offences will be treatedas civil in nature and only a penalty will be levied.
(b) Inspection by ROC: Theamendment empowered the Registrar to carry out physical inspection of the registered office of a company. In case a default is found with regard to the compliance of requirements for a physical registered office as envisaged under section 12(1) of the Companies Act, 2013, it will be a ground for being struck off.
(c) Limited directoriship: A breach for ceiling for directorship as envissaaged under the Companies Act, 2013 has been made grounds for disqualification.
(d) CSR Activities: Few amendmentshave been brought to the CSR provisions under the Companies Act, 2013. A company to which CSR provisions are applicable, and if the company was unable to spend the money allocated for CSR in any year, then it has been allowed another 3 years time to spend it towards the areas specified under Companies Act, 2013. Further, the unspent CSR funds are mandatorily required to be transferred to a separate bank account. Any non-compliance of the CSR provisions will attract penal clauses.
(e) Oppression and Mismangament: An amendment has been made to the provisions on prevention of mismanagement and oppression, where the Government can make an application to NCLT for identification of a KMP of any company, as not fit or proper person and seeking their removal, in case the KMP is not performing his/her ole properly. The ROC will debar those individuals as per Central Government’s direction/ approval.
(f) Setting up of NFRA: Through the amendment the Government has set up the National Financial Reporting Authority which will be responsible To investigate the matters of professional or other misconduct committed by a prescribed class of chartered accountants. However, the NFRA has the power to investigate a certain prescribed class of companies as mentioned under the Companies Act, 2013.