Companies Act 2013 in Action - 98 Sections comes into force from September 12, 2013
The Ministry of Corporate Affairs (MCA) has notified 98 key sections of the Companies Act 2013 which shall come into effect from today.
The copy of Press release issued by PIB along with the copy of Notification dated September 12, 2013 issued by MCA giving details of provisions brought into effect is attached for your reference.
The sections so notified will come into effect from the date of notification i.e today (September 12, 2013). These are independent sections, which do not require the publication of rules. Currently, ministry is going through the process of receiving suggestions on draft rules. The Companies Act 2013 will have 470 sections. Other sections will come into effect after the rule making process is completed.
The Companies Bill, 2013 was cleared by the Rajya Sabha during the monsoon session and has since received Presidential nod.
This notification includes several provisions relating to several concepts which are being introduced for the first time. The sections notified in the first tranche includes one that deals with Private placement and public issue. The Companies Act,1956 did not define the concept of private placement leading to a major legal battle between market regulator Securities and Exchange Board of India( Sebi) and Sahara India Parivar.
Another controversial section that made its debut is the one relating to insider trading. This provision is likely to create some friction between the MCA and Sebi, which has so far been regulating insider trading in the stock market under its own regulations.
Further also include provisions relating to maximum number of persons in a private limited company, which is being increased from 50 to 200 and other sections relating to penal provisions for fraud in the company.
The provisions relating to fraud found their way into the new companies Act following the lacuna found while dealing with Rs 8,200 crore Satyam Computer scam in 2009. The provisions containing the definition of “Associate Companies” also come into effect in the first tranche.
Click here to see the official Notification issued by Ministry of Corporate Affairs..
Companies Act, 2013 Click here....