The Companies Act, 2013 is a comprehensive legislation that governs the registration, regulation, and dissolution of companies in India. It replaced the Companies Act, 1956 and aims to modernize and streamline corporate law in the country.
The Act provides detailed provisions regarding the incorporation, functioning, and management of companies. Here are some key features and aspects covered by the Companies Act, 2013:
Types of Companies: The Act recognizes various types of companies, including private companies, public companies, one-person companies, and others.
Incorporation and Types of Capital: The Act outlines the procedures for the incorporation of companies and prescribes the types of capital, such as authorized capital, issued capital, and paid-up capital.
Corporate Governance: The Act includes provisions related to the board of directors, their powers, duties, and responsibilities. It also emphasizes good corporate governance practices.
Financial Disclosure and Audit: Companies are required to prepare and file financial statements, and the Act establishes guidelines for auditing and the appointment of auditors.
Shareholder Rights: The Act protects the rights of shareholders and specifies rules related to shareholder meetings, resolutions, and voting.
Corporate Social Responsibility (CSR): It introduces the concept of Corporate Social Responsibility, requiring certain companies to spend a percentage of their profits on socially responsible activities.
Registrar of Companies (RoC): The Act establishes the office of the Registrar of Companies, responsible for the administration of the Act within a specific jurisdiction.
Insolvency and Bankruptcy: The Act incorporates provisions related to insolvency and bankruptcy, providing a legal framework for the resolution of distressed companies.
Competition Law: It incorporates provisions related to competition law to ensure fair business practices.
Penalties and Enforcement: The Act specifies penalties for non-compliance and includes provisions for enforcement and adjudication.
National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT): The Act establishes these quasi-judicial bodies to adjudicate matters related to companies.
The Companies Act 2013 has introduced several changes in the provisions related to governance, e-management, compliance and enforcement, disclosure norms, auditors, and mergers and acquisitions.
It has also included new concepts such as one-person companies, small companies, dormant companies, class action suits, registered valuers, and corporate social responsibility.
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