Govt defers decision on Companies Bill


NEW DELHI: The government today deferred a decision on the new Companies Bill and said it would be taken up next month after sorting out issues concerning delegation of powers to market regulator the Securities and Exchanges Board of India (Sebi).

“Finance Minister has been told by Sebi that few fine tuning matters have to be taken care of before it is actually goes… Since we have time over the next 10 days these things will be fine tuned,” Law Minister told reporters after the meeting of the Union Cabinet.

According to sources, the Finance Ministry sought more clarity on how powers would be delegated to the Sebi in case of regulatory overlapses.

Finance Minister Pranab Mukherjee, Planning Commission Deputy Chairman Montek Singh Ahluwalia and Corporate Affairs Minister Veerappa Moily have been asked to discuss and iron out issues before the next Cabinet meeting on November 3.

“Companies Bill came up before Cabinet today. Few points need to be sorted out. We, Finance Minister, Montek and I, have been asked to discuss it. It is a minor issue so it has not been reffered to a GoM. I am hoping by the winter session it should be through,” Moily said.

The Bill has already been vetted by the Parliamentary Standing Committee of Finance and also by different ministries.

For the first time, the Bill has introduced ideas like Corporate Social Responsibility (CSR), class action suits and a fixed term for independent directors.

Among other things, it also proposes to tighten the laws for raising money from the public. The Bill also seeks to prohibit any insider trading by company directors or key managerial personnel by treating such activities as a criminal offence.

Further, it has proposed that companies should earmark 2% of the average profit of the preceding three years for CSR activities and make a disclosure to shareholders about the policy adopted in the process.

The Companies Bill (2008), which lapsed with the dissolution of the 14th Lok Sabha, was re-introduced in August 2009.


Please follow and like us:



Previous articleLongest Polio free period ever seen in India
Next articleShould private sector firms be subject to RTI & CAG? by Vinayak Chatterjee
India CSR Network
India CSR Network is India's biggest and most trusted news portal in the domain of CSR & Sustainability. India CSR welcomes stories, statements, updates, reports on issues that interest you. Feedback, comments will make it more purposeful and resourceful. It is designed and maintained by India CSR Group. Contents are non-fiction. Though all efforts have been made to verify the accuracy, the same should not be construed as a statement of law or used for any legal purposes. In case of any ambiguity or doubts, readers are advised to verify with the source(s). Statement, articles, views and contributions can be sent to