New Delhi: The Company Law Committee on Monday submitted its recommendations to Finance Minister Nirmala Sitharaman on providing easier functioning for corporates in the country by further decriminalizing the provisions of the Companies Act 2013.
The committee was set up in September by the Corporate Affairs Ministry as part of a larger programme to provide ease of functioning for the corporate sector where sentiments have been dampened on account of multifarious provisions in existing corporate laws that criminalize several business activities even if these are petty and harmless in nature.
The committee took note of the progress made consequent to the Companies (Amendment) Act, 2019, which had resulted in the decriminalisation of 16 minor procedural and technical lapses under the Companies Act, 2013, into “civil wrongs”, the Company Law Committee said in its report.
It has adopted a principle-based approach to further remove criminality in case of default which can be determined objectively and which, otherwise, lack the element of fraud or do not involve larger public interest, the committee said.
The Committee has proposed amendments in 46 penal provisions, so as to either remove criminality, or to restrict the punishment to only fine, or to allow rectification of defaults through alternative methods, which would lead to further de-clogging of the criminal justice system in the country.
It has proposed re-categorizing 23 offences out of the 66 remaining compoundable offences under the Act, to be dealt with within the in-house adjudication framework wherein these defaults would be subject to a penalty levied by the adjudicating officer. (IANS)