Companies Act, 2013

An Insight into Latest Amendments

Submitted To Submitted By

Dr. Navin Shrivastava Group 10

PhD, MBA Ayush Jain (PGMA1946)
LLB(Hons)LLM (Corporate Laws) Vipul Tuteja (PGMA1947)
Aaishik Sen (PGMA1948)
Victor Paul (PGMA1949)
Milind Pant (PGMA1950)
Companies (Prospectus and Allotment of Securities) Second
Amendment Rule, 2018
MCA notifies and substituted existing rule 14 related to private placement of Companies (Prospectus and Allotment of Securities)
Rules, 2014 vide Notification dated 7th August, 2018

• Stringent condition on utilisation of funds : The most significant change in the amendment is that an issuer is not
permitted to utilise any monies raised through private placement till the allotment is complete and the return of
allotment (PAS 3) is filed with the ROC within 15 days of allotment. The timelines for filing the return on allotment
has been reduced to 15 days unlike the erstwhile provision of 30 days. 
• Relaxation in filing of PAS-4 and PAS-5 with ROC: Offer Letter in Form PAS-4 and record of persons to whom the
Offer Letter is issued in Form PAS-5 are required to be maintained by the Company and are no longer required to be
filed with the ROC.
• Resolutions to be filed prior to issue of Offer Letter: Prior to issuing the Offer Letter, the special resolution
approving the issuance of securities and/or board resolution for issue of securities has to be filed with the ROC. In
this regard, it has also been clarified that private companies (which were earlier exempted from filing of board
resolutions) will have to file board resolutions passed for issue of securities.
• There is change in format of Form PAS-4
 Latest Amendments in Company’s Act 2013
COMPULSORY REQUIREMENT FOR DEMATERIALISATION OF
SECURITIES
Companies (Prospectus and Allotment of Securities) Third Amendment Rules, 2018
(By Notification No. .GSR 853(E) dated 10th Sept., 2018

New Rule 9A has been inserted, which requires that;

1. Every unlisted public company (except, WOS, Nidhi and Govt. Company) shall –
(a) issue the securities only in dematerialized form;
(b) facilitate Dematerialization of all its existing securities
2. Dematerialization is a pre-requisite condition to making any offer for issue of any securities; or buyback; or issue of
bonus or rights offer, transfer or subscription of securities after 2 nd Oct., 2018.
Comments: Public company includes subsidiary of public company
3. This rules shall not apply to an unlisted public company which is:—
(a) a Nidhi; (b) a Government company or (c) a wholly owned subsidiary.
COMPULSARY REQUIREMENT FOR DEMATERIALISATION OF SECURITIES

4. Other requirements:

(a) Appointment of RTA, Triparty Agreement with DP, RTA and Company, and obtaining ISIN for each type of securities
(b) Payment of security Deposit to RTA and DP for two years in advance
(c) Submission of the Security Audit Report u/s 55A of the Depository Rules on half yearly basis within 30 days of the
end by PCS to RoC (Form not Prescribed) (Before 30.04.2019 and onwards)
(d) In case of default in payment (deposit/fee) of the custodian fee and RTA fee, company shall not be eligible for Bonus
and Right issue.
(e) In case of any grievance the complaint can be made to IEPF
5. Obligations: On Company to have connectivity for D-mat, but shareholders is not bound to D-mat their holding
until;
(f) Do not wish to transfer the shares;
(g) Do not wish to participate in rights, private placement, buy back, and bonus.
(h) Fine: No fine prescribed for non compliances, however under the General Section 450 upto Rs. 1,000/- per day.
(i) It is likely that in the Form MGT-7, the new details for the ISIN/RTA may be added for review of compliance by the
RoC
(j) Entire promoters, directors and KMPs shareholding must be in D-mat Form before taking any corporate action
 Specified Companies (Furnishing of information about payment to micro
and small enterprise) Order, 2019.
MCA Notification No. GSR 368(E) dated 22.01.2019 read with the Notification SO 5622(E) dated 2nd Nov., 2018

Meaning of Specified Company:

All companies, who get supplies of goods or services from micro and small enterprises and whose
payments to them exceed forty five days from the date of acceptance or the date of deemed acceptance of
the goods or services (as at 22.01.2019) as per the provisions of section 9 of the MSMED Act, 2006.
Criteria of Micro and Small Enterprises:
Section 9 of the MSMED Act, 2006 defines them as per investment In P & M /Equipments:

Type of Enterprise Manufacturing Industry Service Industry

Micro Does Not Exceed Rs. 25 Lakhs Does Not Exceed Rs. 10 Lakhs
Small Exceeds Rs. 25 Lakhs but does not exceed Rs. 5 Crore Exceeds Rs. 10 Lakhs but does not
exceed Rs. 2 Crore
Medium Exceeds Rs. 5 Crore but does not exceed Rs. 10 Crore Exceeds Rs. 2 Crore but does not
exceed Rs. 5 Crore
 Specified Companies (Furnishing of information about payment to micro and
small enterprise) Order, 2019.
Whether Registration of Micro/ Small enterprises is mandatory:
No, Section 8(1)(a) provides discretion to get registration, means there is no mandatory requirement for having any such
registration certificate, only confirmation of them is sufficient
Requirement to make payment & Interest if any
Section 15 provides the maximum period of 45 days to make payment irrespective of the agreed period exceeding 45 days.
Section 16 make obligations to pay monthly compounding interest for delayed period @ 3 times of the Bank Rates of the
RBI.
Requirement for reporting to the RoC in Form MSME-1
Required u/s 405 of the CA for providing information of statics
 1st Time as at 22.01.2019 (within 30 days, i.e. on or before 20.02.2019)
 Half yearly on 31st March and 30th Sept., within 30 days of the end of period
 The form needs to be signed by the director/ cs of the Company, No certification.
Mis-use of information: for IBC or otherwise by Micro/ Small enterprises
Fine: On company upto 25,000 and on Directors Rs. 25,000 to Rs. 3,00,000 or imprisonment upto 6 months or both
(Compoundable)
 Companies (Acceptance of Deposits)Amendment Rules, 2014.
Amended by MCA Notification No. 42(E) dated 22.01.2019

 In the Rule 2(1)(c)(xviii) in the exempted category of deposits “any amount received by a company from
Alternate Investment Funds, Domestic Venture Funds, Infrastructure Investment Trusts, (Real Estate Investment
Trusts) and Mutual Funds registered with SEBI in accordance with regulations made by it.” has been inserted.
 In Rule 16 which provides that every company to which deposits rules apply, shall on or before the 30th day of
June, of every year, file with the RoC, a return in Form DPT-3 and furnish the information contained therein as
on the 31st day of March of that year duly audited by the auditor of the company. In the said rule the following
explanation has been inserted:
“It is hereby clarified that Form DPT-3 shall be used for filing return of deposit or particulars of transaction not
considered as deposit or both by every company other than Government company”
COMPANY (Amendment) Ordinance, 2019

Section 2(41) read with Rule 40 of Companies (Incorporation) (Fourth Amendment) Rules, 2018: (W.e.f.
02.11.2018 ) Rules Notified on 18.12.2018)

“Financial year”, in general Financial year means the period ending on the 31st day of March every year and where it
has been incorporated on or after the 1st day of January of a year, the period ending on the 31 st day of March of the
following year.

Existing proviso has been substituted as; Provided that where a company or body corporate, which is a holding
company or a subsidiary or Associate of a company incorporated outside India and is required to follow a different
financial year for consolidation of its accounts outside India, the Central Government may, on an application made to
Regional Director in Form RD-1, allow any period as its financial year, whether or not that period is a year;

- All the applications pending before the Tribunal on the date 02.11.2018 shall be disposed by Tribunal in accordance
with the previous rules
 COMPANY (Amendment) Ordinance, 2019
SECTION 14 READ WITH RULE 41
CONVERSION OF PUBLIC COMPANY INTO PRIVATE COMPANY.

Any application pending before tribunal shall be disposed off by it in accordance

with the provisions applicable to it before such commencement.
 Application needs to be made within 60 days of Special Resolution with fee as Conversion of
per CG Rules along with; Company

 Declaration of two directors for No. of members and Deposits,

 Declaration by KMP/Director for compliance of sec. 73-76A, 177, 178,
179(3)185, 186, 188
 List of Creditors, Debenture holders not older than 30 days of filing application to Old Provision New Provision
the RD
 Publication of Advertisement in Form 25A atleast 21 days before application
 Service of notice by Regd. Post to creditors, debenture holders, RoC and
File Application to
regulating authority if any. File Petition to CG power
 RD may ask further information (upto 2 resubmission) in the Form RD-GNL 5 NCLT delegated to RD in
Form RD-1
within 15 days
 RD shall approve the application within 30 days of submission of all information,
he may call hearing in person
Thank You