The Lok Sabha on Thursday has passed the Companies (Amendment) Bill, 2016. Members of the Lower House sought several amendments during the passage of the Bill and amends the 2013 Act to address difficulties in implementation with respect to compliance requirements and facilitates ease of doing business.
During the debate, members pointed out that a high number of sections of the Companies Act had not yet been notified which was leading to implementation issues and sought a reply from the government in this regard. Some members raised their concern about independent directors being allowed up to 10 percent pecuniary interest in the company, which could lead to a conflict of interest. It was also pointed out that clarity on several aspects of the Bill has been left to delegated legislation.
Once implemented, the Companies Act is expected to improve India’s standing as a business friendly nation. This could lead to a potential increase in multinational companies setting up businesses in the country, thereby generating employment in India and promoting India as a rising hub for commerce.
(With inputs from ANI)