Offenses Under Companies Act May Be Decriminalized
[ By Bobby Anthony ]The union cabinet may consider amending the Companies Act to decriminalize around 44 of 66 offenses, including corporate social responsibility (CSR) violations as well as non-filing of returns, as per recommendations of the Company Law Committee (CLC), which is headed by corporate affairs secretary Injeti Srinivas.The CLC was constituted in September 2019 to...
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The union cabinet may consider amending the Companies Act to decriminalize around 44 of 66 offenses, including corporate social responsibility (CSR) violations as well as non-filing of returns, as per recommendations of the Company Law Committee (CLC), which is headed by corporate affairs secretary Injeti Srinivas.
The CLC was constituted in September 2019 to re-categorize offenses under the Companies Act and review provisions of both the Companies Act and the Limited Liability Partnerships (LLP) Act.
It may also consider easing remuneration norms to allow loss-making companies to offer higher salaries to key managerial personnel.
As per recommendations by the CLC, the union cabinet may consider a proposal which seeks to make it mandatory for “systemically important non-listed companies” to file returns quarterly instead of the once a year.
Such a move is expected to increase compliance costs of large unlisted companies.
Other CLC proposals include allowing key managerial personnel, including non-executive directors, of companies to receive higher remunerations, even in cases where companies have not made profits.
These CLC recommendations are being considered after representations from industry, including infrastructure, power and telecom sectors.
