The government on November 2 promulgated an ordinance to amend the Companies Act, a senior official said. The proposal to issue an ordinance to amend the Companies Act, 2013, was cleared by the Cabinet yesterday.
The official further said that the ordinance had received assent from President Ram Nath Kovind and has been promulgated.
The Corporate Affairs Ministry, which is implementing the act, has been looking at ways to promote ease of doing business as well as to ensure better compliance levels.
The ordinance will change the Companies Act to declog national company law tribunals (NCLTs) and decriminalize minor offenses by companies.
It will transfer 90 percent of the cases to regional directors under the Ministry of Corporate Affairs from the NCLTs. The move will bring down the NCLT’s load.
A senior official from the Corporate Affairs Ministry reportedly said, “The way the Act is being amended, regional directors will be able to look into the cases. With this amendment, 90 percent company law cases will move from NCLTs to regional directors.”
The status of all non-compoundable offenses will be retained since they are serious in nature.