New Companies bill likely to be passed in monsoon session: MoS -Governance Now

New Companies bill likely to be passed in monsoon session: MoS

The Bill encourages e-governance

PTI | May 31, 2012

The much-awaited new Companies Bill, which seeks to replace the Companies Act 1956, is likely to be passed in the monsoon session of parliament, minister of state for corporate affairs RPN Singh said on Wednesday.

"The new Companies Bill is likely to be taken up in the upcoming session of parliament," Singh said at an Assocham event in Delhi.

"The new Companies Bill is back with the parliamentary standing committee on finance as the committee wanted to discuss certain issues and suggestions of the stakeholders," he added.

When asked if the proposal of two per cent CSR spend is the main bone of contention, Singh refused to clear the air but said, "we have continued in the spirit of the parliamentary standing committee on finance's suggestions and we will continue to do that."

The new Companies Bill, which was first introduced in the Lok Sabha in 2008, seeks to give a fillip to the cause of corporate social responsibility and corporate governance.

Besides, the Bill will make it mandatory for firms to maintain their documents in electronic format. It also introduces the concept of e-governance, makes provision for encouraging ethical corporate behaviour and rewards employees for their integrity.

He pointed out that merger and acquisitions were significant business tools in the current scenario and the government was committed to lend its support to the industry while ensuring a proper regulatory framework.

"We need to strategically utilise the international M&A deals to invest the surplus funds generated through trade with other countries and counter Chinese supremacy in this regard," said Singh, adding, "Corporate restructuring through M&As has increased substantially and is likely to spur in the future and resulting in rise of export revenue contributions."

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