EXEMPTION TO SECTION 8 COMPANIES - Notification 13.06.2017
EXEMPTION TO SECTION8 COMPANIES - Notification 13.06.2017
SHORT SUMMARY:
In this Flash editorial, the
author begins by referring the powers of central government providing under
Section 462 of Companies Act, 2013. The Central Government, in the interest of
public, hereby amends the notification of the Government of india, in the
Ministry of Corporate Affairs, vide number G.S.R. 464(E) dated the 5th June,
2015 published in the Gazette of India, Extraordinary, Part-ll, Section 3,
Subsection (i), dated the 5rh June 2015 (hereinafter referred to as the
principal notification), namely:
This is article no. 234 of the series of editorials
written by the author on corporate laws {Including Companies Act, 2013, SEBI,
RBI Regulations, IBC, LLP Act, 2008 etc.}.
INTRODUCTION:
Ministry of Corporate Affairs On
5th June, 2015 lay down exemption to Section 8 Company from some the provision
of the Companies Act, 2013. According to the exemptions Provisions of companies
act, 2013 given in principle notification shall not apply or shall apply with
such exceptions, modifications and adaptations, as specified in the principle
notification. (Link of principle
Notification
MCA has laid down the copy of the
Notification under section 462 of the Companies Act 2013 (“the Act”) providing some
more exemptions to Section 8 Company from the provisions of the Companies Act,
2013 in addition to the exemption notification dated 5th June, 2015.
New Exemption in addition to
earlier exemption- By Notification on 13th June, 2017
MCA lay down below given
exemption to Section 8 Companies from the provision of the Companies Act, 2013.
S.N
|
Chapter/
Section of the Act
|
Particular
|
Exemption Provided in MCA Notification
|
|
A.
|
Clause (b) and
first proviso (1) of Section 149
|
In the exemption notification dated 5th June, 2015, in the
table, for serial number 8 , the following serial no. shall be Substituted, namely:-
149. (1) Every company shall have a Board of Directors
consisting of individuals as directors and shall have—
(b) a maximum of fifteen directors:
|
This clause shall not apply to the
Section 8 Company.
|
|
B.
|
Sub Section (7)
of section 186
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[1]186(7) (7) No loan shall be given
under this section at a rate of interest lower than the prevailing yield of
one year, three year, five year or ten year Government Security closest to
the tenor of the loan.
Addition of Proviso after sub section 7
|
Provided that nothing contained in this sub-section shall apply
to a company in which twenty-six per cent. or more of the paid-up share
capital is held by the Central Government or one or more State Governments or
both, in respect of loans provided by such company for funding Industrial Research
and Development projects in furtherance of its objects as stated in its memorandum
of association.".
|
(Author
– CS Divesh Goyal, GOYAL DIVESH & ASSOCIATES Company Secretary in Practice
from Delhi and can be contacted at csdiveshgoyal@gmail.com)
Disclaimer:
The
entire contents of this document have been prepared on the basis of relevant
provisions and as per the information existing at the time of the preparation.
Although care has been taken to ensure the accuracy, completeness and
reliability of the information provided, I assume no responsibility therefore.
Users of this information are expected to refer to the relevant existing
provisions of applicable Laws. The user of the information agrees that the
information is not a professional advice and is subject to change without
notice. I assume no responsibility for the consequences of use of such
information. IN NO EVENT SHALL I SHALL BE LIABLE FOR ANY DIRECT, INDIRECT,
SPECIAL OR INCIDENTAL DAMAGE RESULTING FROM, ARISING OUT OF OR IN CONNECTION
WITH THE USE OF THE INFORMATION.
[1]
The
exceptions, modifications and adoptions provided in column (B) of the aforesaid
table shall be applicable to a Government Company which has not committed a
default in filing its financial statements under Section 137 of the said Act or
annual return under section 92 of the said Act with the Registrar.
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