Law & Justice News India
Companies Act Amendment bill Under Preparation
(May 15 , 2007 - PIB Release )
The Government initiated the process for comprehensive revision of the Companies Act, 1956 by preparing a concept paper on company law which was placed on the website of the Ministry on August 4, 2004 for information and comments by stakeholders. Thereafter, on December 2, 2004, an Expert Committee headed by Dr. J J Irani was constituted to subject various views/opinions received to merit evaluation and make recommendations to the Government on revision of the Companies Act, 1956. The Committee submitted its report on May 31, 2005.
The Irani Committee, while observing that the law should take into account the requirements of different kinds of companies and prescribing the essential requirements of their corporate governance structure, recommended that Small and Private Companies should be provided greater flexibility and freedom of operation while enabling compliance at low cost. To unleash the entrepreneurial talent of the people in the information and technology driven environment, law should recognize One-Person Company (OPC). Such companies should be provided with a simple legal regime through exemptions.
Taking into account the recommendations of the Irani Committee as also other inputs received by the Government, a draft Companies Bill is under preparation, in consultation with Ministry of Law, to be introduced in the Parliament once finalized with requisite approvals.
This information was given by Shri Prem Chand Gupta, Minister of Company Affairs in reply to the questions raised by Shri Jai Parkash Aggarwal in Rajya Sabha today.