Govt to introduce scheme to get cos registered in 48 hours

Corporate Affairs Ministry had earlier said that by August this year companies would be registered within 24 hours

PTI | October 21, 2011



After withdrawing its ambitious initiative for incorporating companies within 24 hours, the Corporate Affairs Ministry on Wednesday said it plans to introduce a new scheme under which entities could get themselves registered for operations in 48 hours.

Addressing a PHD Chamber event, Corporate Affairs Secretary Naved Masood said the availability of name was a bottleneck for companies seeking online incorporation within 24 hours.

"Yes, our initiative was a little ambitious, so we had to take it off. Now, we are working on a revised plan of introducing a new scheme that would help companies to incorporate online within 48 hours and I think this is workable," Massod said.

He added that the scheme was facing more problems in the Eastern and Northern regions.

"But I should also admit that more and more companies are coming up in these regions," he said.

Aiming at simplifying procedures of the Companies Act, 1956, in July, the MCA had brought out a circular enabling companies to float online, beginning August 11, 2011.

In his interaction, MCA Secretary also expressed hope that the new Companies Bill, which promises greater transparency and better corporate governance norms, would be passed by both the houses of Parliament by the Budget session in February.

"I hear, the Cabinet approval is expected to be out any of these days. Hopefully, by the Budget session, the new Companies Bill will become law," he said.

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

On the issue of the implementation date of IFRS, Masood said that there were still few issues that needed clarity from the Finance Ministry relating to tax implications. The MCA Secretary said he was hopeful that the Direct Tax Code would bring in that clarity.

Large listed companies were to prepare their account books as per global accounting practice IFRS from April 1, 2011, but uncertainty still looms about the implementation date.

As per the earlier road map laid out by the MCA, companies will have to prepare their accounts as per the new norm in a phased manner, beginning with companies that have a networth of over Rs 1,000 crore from April 1.

Further, while scheduled commercial banks and urban cooperative banks will adopt IFRS from April 1, 2013, all insurance companies will have to convert their opening balance sheets under IFRS from April, 2012.

Large, listed non-banking finance companies (NBFCs) will converge their opening books of accounts with IFRS norms from April 1, 2013.

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