MINISTRY OF CORPORATE AFFAIRS

Notification relating to amendments of Schedule VII of Companies Act, 2013

The Ministry of Corporate Affairs (“MCA”) has issued notification dated 27th February, 2014 amending the Scheduled VII of Companies Act, 2013 by substituting the following items for item (i) to (x) :

1. eradicating hunger, poverty and malnutrition, promoting preventive health care and sanitation and making available safe drinking water:

2. promoting education, including special education and employment enhancing vocation skills especially among children, women, elderly, and the differently abled and livelihood enhancement projects:

3. promoting gender equality empowering women, setting up homes and hostels for women and orphans: setting up old age homes, day care centres and such other facilities for senior citizens and measures for reducing in equalities faced by socially and economically backward groups:

4. ensuring environmental sustainability, ecological balance, protection of flora and fauna animal welfare, agroforesty, conservation of natural resources and maintaining quality of soil, air and water:

5. Protection of national heritage, art and culture including restoration of buildings and sites of historical importance and works of art: setting up public libraries: promotion and development of traditional arts and handicrafts:

6. Measures for the benefit of armed forces veterans, war widows and their dependents:

7. Training for promote rural sports, nationally recognised sports, paralympic sports and Olympic sports:

8. contribution to the Prime Minister’s National Relief Fund or any other fund set up by the Central Government for socio-economic development and relief and welfare of the Scheduled Castes, the Scheduled Tribes, other backward classes, minorities and women:

9. Contribution or funds provided to technology incubators located within academic institutions which are approved by the Central Government:

Companies (Corporate Social Responsibility Policy) Rules, 2014

The Ministry of Corporate Affairs has notified the Companies (Corporate Social Responsibility Policy) Rules, 2014 on 27th February, 2014, which will effective from 1st April, 2014.

Notification relating to effective date of provisions of Section 135 and Schedule VII of Companies Act, 2013.

The Ministry of Corporate Affairs has notified on 27th February, 2014, that the effective date on which the provision of Section 135 of the Companies Act, 2013 (“the Act”) and Scheduled VII of the Act, shall come into force is 1st April, 2014.

Clarification with regard to Section 185 of the Companies Act, 2013.

The Ministry of Corporate Affairs (“MCA”) has issued General Circular No.03/2014 dated 14th February, 2014 making a clarification with respect to Sec 185 of the Companies Act, 2013.

MCA has Clarified that any guarantee given or security provided by a holding company in respect of the loans made by banks and financial institution to its subsidiary company, exemption as provided in clause (d) of sub-section (8) of Section 372A of Companies Act, 1956 shall be applicable till the Section 186 of the Companies Act, 2013 is notified.

Further it has clarified that, the loan so obtained by the Subsidiary are exclusively utilized for its principal business activities.

Use of word “National” in the names of Companies or Limited Liability Partnerships (LLPs)

The Ministry of Corporate Affairs (“MCA”) has issued General Circular No. 02/2014 dated 11th February, 2014 with reference to use of word “National” in the name of Companies/ Limited Liability Partnership (“LLP”). MCA intimated that no Company/LLP shall use the word National unless it is a Government Company and the Central / State Government has taken over it

MCA also intimated that the word “Bank” shall be allowed in the name of entity only after providing ‘No Objection Certificate’ from the RBI.

Further, it was also informed that the word “Stock Exchange” or “Exchange” shall be allowed in the name of an entity only after providing ‘No Objection Certificate’ from the Securities Exchange Board of India (SEBI).