MINISTRY OF CORPORATE AFFAIRS (MCA)

1. The Companies (Acceptance of Deposits) Amendment Rules, 2015:

In exercise of the powers conferred by Sections 73 and 76 read with sub-section (l) of section 469 of the Companies Act, 2013 (18 of 2013), the Central Government has made the following rules further to amend the Companies (Acceptance of Deposits) Rules, 20 I 4., with effect from 31^st March, 2015 namely:-

(l) These rules may be called the Companies (Acceptance of Deposits) Amendment Rules, 2015.

In the Companies (Acceptance of Deposits) Rules, 2014.-

(l) in rule 2, in sub-rule (l), in clause (c), –

(a) in sub-clause (vii), in Explanation (a), the following proviso shall be inserted, namely:-

“Provided that unless otherwise required under the Companies Act, 1956 (l of 1956) or the Securities and Exchange Board of India Act, 1992 (15 of 1992) or rules or regulations made there under to allot any share, stock, bond, or debenture within a specified period, if a company receives any amount by way of subscriptions to any shares, stock, bonds or debentures before the 1^st April,2014 and disclosed in the balance sheet for the financial year ending on or before the 31^st March,2014 against which the allotment is pending on the 3lst March,2015, the company shall, by the 1^st June 2015, either return such amounts to the persons from whom these were received or allot shares, stock, bonds or debentures or comply with these rules.”

There are few more amendments which are specified in the rules.

2. Amount received by private companies from their members, directors or their relatives before lst April, 2014

MCA has through its General Circular No. 05/2015 dated March 30, 2015 clarified that the amounts received from Members, Directors or their relatives in the private Companies shall not be treated as ‘deposits’ under the Companies Act,2013 and Companies (Acceptance of Deposits) Rules, 2014 so long as the relevant Private Company discloses, in the notes to its financial statement for the financial year commencing on or after 1^st April, 2014 the figure of such amounts and the accounting head in which such amounts have been shown in the fi nancial statement.

Any renewal or acceptance of fresh deposits on or after 1st April, 2014 shall, however, be in accordance with the provisions of Companies Act, 20 13 and rules made thereunder.

3. The Companies (Management and Administration) Amendment Rules, 2015:
In exercise of the powers conferred under Section 108 read with sub-section (1) & (2) of section 469 of the Companies Act, 2013, the Central Government has made the following changes to Rule 20 to amend the Companies (Management and Administration) Rules, 2014 on 19th March, 2015. Some of the major changes are listed below:

• The amended rules pertaining to Electronic Voting shall apply in respect of the general meetings for which notices are issued on or after the dale of commencement of this rule.
• Every company other than a company referred to in Chapter XB or Chapter XC of the Securities and Exchange Board of India (issue of Capital and Disclosure Requirements) Regulations’ 2009 having its equity shares listed on a recognised stock exchange or a company having not less than one thousand members, shall provide to its members facility to exercise their right to vote on resolutions proposed to be considercd at general meetings by electronic means’
• Definitions of jargons like agency, cutoff date, cyber security, electronic voting system, secured system, etc., have been defined clearly.
• The notice of the meeting shall be sent to all the members, Directors and Auditors of the Company only by a registered post, speed post, courier or through electronic means to the registered e-mail ID of the recipient.
• The Notice shall be placed on the website of the Company.
• The notice should also clearly state that, the facility for voting, either through electronic voting system or ballot or polling paper shall also be made available at the meeting and members attending the meeting who have not already cast their vote by remote e-voting shall be able to exercise their right at the meeting;
• The Notice shall state the process of login and voting through electronic means.
• The Notice shall also state the website address of the Company where notice of the meeting is displayed and the Name, designation, address, email-id and phone number of the person for addressing the grievances.
• The facility of e-voting shall be open for not less than 3 days and shall close at 5.00 P.M. of preceding day of the meeting and thereafter shall be blocked.
• The Board of Directors shall appoint a Scrutinizer who shall be a Practicing CA, CS, CWA or an Advocate who is not in employment of the Company and who can conduct the process in a fair and transparent manner. However, before such appointment the Scrutinizer should be willing to get appointed and to conduct the e-voting process.
• The procedure to be followed by Scrutinizer has been specified.

4. The Companies (Meetings of Board and its Power) amendment rules, 2015:

In exercise of the powers conferred under Sections 173, 175, 177, 178, 179, 184, 185, 186,187,  188,  189  &  191  read  with  Section  469  of  the  Companies  Act,  2013,  the  Central Government  has  made  the  following  Rules  on  18th March,  2015  further  to  amend  the Companies (Meeting of Board and its Powers) Rules, 2014.

• In Rule 8 dealing with the powers of the Board the Item numbers (3), (5), (6), (7), (8) & (9) and the entries relating thereto are omitted.
• In proviso of Rule 10 dealing with the Loans to Directors for the word “Principle” is substitutes with the word “Principal”.

5. The Companies (Share Capital and Debentures) Amendment Rules, 2015

In exercise of the powers conferred under clause (a) (iii) of section 43, sub-clause (d) of sub-section (1) of section 54, sub-section (2) of 55, sub-section (1) of section 56, sub-section (3) of section 56, sub-section (1) of section 62, sub-section (2) of section 42, clause (f) of sub-section (2) of section 63, sub-section (1) of section 64 , clause (b) of sub-section 3 of section 67, sub-section (2) of section 68 sub-section (6) of section 68, sub-section (9) of section 68, sub-section (10) of section 68, sub-section (3) of section 71, sub-section (6) of section 71, sub-section (13) of section 71 and sub-sections (1) and (2) of section 72, read with sub-section (1) and (2) of section 469 of the Companies Act, 2013 (18 of 2013) the ministry has amended the Share Capital and Debenture Rules from 18^th March, 2015.

These rules may be called the Companies (Share Capital and Debentures) Amendment Rules, 2015.

Application- The provisions of these rules shall apply to – (a) all unlisted pubic companies: (b) all private companies: and (c) listed companies so far as they do not contradict or conflict with any other regulation framed in this regard by the Securities and Exchange Board of Inda:

The gist of the major amendments is given below: –

• As per Rule 5(3), if there is a Company Secretary appointed in the company he shall be deemed to be an authorized person to sign the Share Certificate and affix the seal. – This provision has been omitted.
• Listed Company can provide Duplicate Share Certificates within 45 days (earlier 15 days) of receipt of all the relevant documents (Rule 6(c)).
• The word employee as defined in rule 12 now does not include the employee of an Associate Company.
• Rule 13 has been amended to an affect that, if the Company makes any preferential allotment to the Existing members, the Company is not required to issue an offer letter in PAS – 4 and need not file the same along with PAS – 5 in GNL -2.
• As per amended rules, the Company can now create a pledge on moveable properties in favour of the Debenture trustee. Further, if any company issues any debentures whose payment is guaranteed by the Central government or State Government or by both, then creation of charge on assets do not apply.
• Company can create charge on the assets of the holding Company for the loan taken by the Subsidiary Company.
• As per the amended rules the Trust Deed should be executed within 3 months of closure of issue or offer, rather than within 60 days of allotment.
• Nothing in the rules shall apply if the Company issues any Commercial paper or any other instruments issued as per RBI guidelines.

6. Clarification with regard to section 185 and 186 of the Companies Act, 2013 – Loans and advances to employees

MCA has issued General Circular No. 04/2015 dated 10^th March, 2015, which clarifies that loans and advances made by the Company to their employees, other than the managing or whole time directors (which is governed by section 185) shall not attract provisions of Sections 186 of the Companies Act, 2013 till such time they are issued accordance with the conditions of service applicable to employees and also in accordance with their remuneration policy.

7. Clarification relating to filing of e-form DIR-I1 & DIR-12 under the Companies Act, 2013.

MCA received several representations about the  difficulties faced by stakeholders due to deactivation of DSC following  masse resignation of all the directors of a company before appointment of new directors in their places. MCA has issued a General Circular No. 03/2015 dated 3^rd March, 2015, clarified the Registrar of Companies within their respective jurisdictions are authorized, on request from the stakeholders, and after due examination, to allow any one of the resigned director who was an authorized signatory Director for the purpose of filing DIR-12 only along with additional fees, as applicable and subject to compliance of other provisions of Companies Act, 2013.