The government is likely to take up tomorrow the proposal to give ex post facto approval to the Companies Law Amendment Bill which was introduced in the Lok Sabha last month.
The Companies (Amendment) Bill, 2016 — introduced by Corporate Affairs Minister Arun Jaitley in the Lok Sabha on March 16 — has been referred to the Parliamentary Standing Committee on Finance.
Sources said the proposal for “ex post facto” approval for the bill is on the agenda of the Cabinet meeting scheduled for tomorrow.
The inter-ministerial consultations on the bill were completed only on March 12 and the Cabinet could not meet before closing of the first half of the Budget session on March 16. Hence, the bill was introduced in the Lower House after getting approval from Prime Minister Narendra Modi under a provision of Government of India (Transaction of Business) Rules, 1961, they added.
After taking into consideration suggestions made by a high-level panel on further possible changes to the law, the government came up with the bill as part of larger efforts to address difficulties faced by stakeholders and improve the ease of doing business in the country.
Proposing a host of changes to the Companies Act, 2013, the bill seeks to simplify private placement process, remove restrictions on layers of subsidiaries and investment companies, amend CSR (Corporate Social Responsibility) provisions to bring greater clarity and exempt certain class of foreign entities from the compliance regime under this law.
The bill has been referred to the Parliamentary Standing Committee, which is expected to prepare its report within three months.
This would be the second time that Modi government would be amending the Companies Act, 2013 which was passed during the previous UPA regime.
Most provisions of the Act came into force from April 1, 2014. Out of 470 sections of the Companies Act, 284 have come into effect.