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Year
End Review - 2016
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Ministry
of Corporate Affairs
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Following are the major Policy Initiatives and Achievements of the
Ministry of Corporate Affairs, Government of India during the Year-2016:
1.
To
review the Companies Act, 2013 based on implementation experience in line with
changing economic environment and initiatives for addressing all concerns with
reference to Companies Act, 2013 and Companies
(Amendment) Bill, 2016;
The
Companies (Amendment) Bill, 2016 was introduced in the Lok Sabha on 16th
March, 2016 proposing to amend Companies Act, 2013[CA-13]. The Bill was
subsequently referred to the Parliamentary Committee on Finance and the
Committee, after examination, presented its report to both Houses of the
Parliament on 7th December, 2016. The Bill is likely to be
considered and passed by both the Houses of Parliament with or without
modifications including through official amendments, if any.
2.
Notifications
of remaining Sections of the Companies Act, 2013
As on 15th December, 2016 out
of 470 sections, 422 sections of the Companies Act, 2013 have been notified. 39
sections are omitted by Insolvency Banking Code (IBC). Remaining 9 sections
would be notified shortly.
3. On the
request of Gujarat International Finance Tec-City (GIFT CITY), Gandhinagar,
where the country’s First International Finance Service Centre (IFSC) has been
set-up, draft notifications have been laid in the Parliament during Monsoon
Session 2016, proposing exceptions from, and modifications and adaptations of
various provisions of the Companies Act, 2013 for companies licensed to operate
by the Reserve Bank of India (RBI) or Securities and Exchange Board of India (SEBI)
or Insurance Regulatory and Development Authority of India (IRDA). This will
apply to all other IFSC located in an approved multi services special economic
zone set-up under Special Economic Zones Act, 2005, which may be set up
subsequently.
4. Stabilization
of the Cost Records and Audit Rules:
The Companies (Cost Records and Audit)
Rules, 2014 reviewed so as to make necessary amendments for further improvement
and to obviate ambiguities or technical errors, keeping in view the practical
difficulties experienced over a period of time and after considering various
queries/ representation from the stakeholders. Necessary amendments were
notified vide notification dated 14-07-2016.
5. Improvement
in compliance level:
·
Filing
of Cost Audit Report: For the Financial Year 2014-15, the compliance level till
the prescribed time i.e. October 2015 was 48 per cent. By sustained efforts,
the compliance level stood improved to 88 per cent by July 2016.
·
Appointment
of Cost Auditor: For the period 2015-16, the compliance level with
respect to the companies required to approve Cost Auditor also improved by 10
per cent.
6. The
Insolvency and Bankruptcy Code, 2016 (Code):
The Insolvency and Bankruptcy Code, 2016
(Code) was published in the Official Gazette on 28th May, 2016 and
Government of India (Allocation of Business) Rules, 1961 were amended and
notified on 1st Aug, 2016 wherein the Ministry of Corporate Affairs
was entrusted with the responsibility to administer the Code.
7. The
Insolvency and Bankruptcy Board of India (IBBI) was established vide gazette
notification dated 01.10.2016.
The Insolvency and Bankruptcy Board of
India (IBBI) was established under the Code and Chairperson of the Board was
appointed vide gazette notification dated 01.10.2016. Four ex-officio members
of the Board were also appointed vide Order dated 1.10.2016 and selection of
whole-time members of the Board is under process.
8. Framing of Rules
and Regulations and notification of sections under the Code
MCA was assigned with timeline of 1st
December, 2016 to put in place Corporate Insolvency Resolution process as
stated under the Code. To achieve the target, following three pillars as
envisaged under the Code have been put in place by framing various rules and
regulations and notifying relevant sections of the Code:-
(i) Insolvency and
Bankruptcy Board of India [IBBI]
(ii) Insolvency
Professional Agencies & Insolvency Professionals
(iii) Adjudicating Authority
Ministry
has also successfully operationalized the Code within given timeframe which is
likely to improve India’s rank in terms of Ease of Doing Business. It will also
have desired effect on Start-Up India plan as envisaged by the Government.
9. National
Company Law Tribunal and National Company Law Appellate Tribunal
Chapter – XXVII of Companies Act, 2013
deals with formation of National Company Law Tribunal (NCLT) and National
Company Law Appellate Tribunal (NCALT). The constitution of NCLT and NCALT
have been notified on 01st June, 2016. Vide Notification dated 30th
November, 2016, the Central Government has designated the Benches of NCLT to
exercise the jurisdiction, power and authority of Adjudicating Authority
conferred by or under part II of the Insolvency and Bankruptcy Code, 2016.
*****
DSM/
MS/AK/ KA
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