Companies (Amendment) Act, 2019 - salient features
Bhumesh Verma 22 Aug 2019

Companies (Amendment) Act, 2019 - salient features

The much awaited the Companies (Amendment) Bill, 2019 was passed by the Parliament recently with the objective to augment more transparency/accountability in compliance/business management of the Indian corporate sector and to reinforce the corporate governance regime.

Some outstanding features of the new / amended provisions are de-criminalization of certain offences, rationalization of corporate governance provisions and reduction of the burden on the shoulders of the National Company Law Tribunal (NCLT).

The central government had constituted a high level committee and assigned with the job of reviewing the Companies Act, 2013 (Act) and recommending apt amendments to the Act.

Based on the committee recommendations the central government had passed multiple ordinances related to company amendments in November 04, 2018, January 04, 2019, January 12, 2019 and February 21, 2019 respectively prior to giving effect to the existing Amendment (Bill), 2019.

The following are the major reforms:

a) Empowerment of the central government to sanction the conversion of public companies into private companies and alteration of financial year of a Indian company having Holding/ subsidiary/ Associate Company situated outside India;

b) Hefty penalties are pioneered with the intent to avert the commission of repeated defaults; 

c) Reintroduction of requirement of submitting commencement of business declaration;

d) Establishment of in-house adjudication framework to resolve the compoundable offences;

e) Disqualification of directors for accepting the director position beyond the permissible limits as specified in the Act;

f) Expansion of pecuniary jurisdiction limit of the Regional Director to adjudicate the compound offences; and

g) De-registration of a company on the ground of non-maintenance of a registered office.

The company reforms can be majorly categorized into four heads:

  • De-criminalization of offences
  • Imposition of stringent penalties for repeated defaults
  • Reduction of default cases burden on NCLT.
  • Corporate governance reforms

De-criminalization of offences:

The following is the list of criminal defaults which are re-classified into civil defaults: Penalty will be imposed on:

  • The company and any officer in default who has unlawfully issued shares at a discount (S. 53). 
  • The company and any officer in default for failure/delay in filing notice for alteration of share capital (S. 64). 
  • The company and any officer in default for failure/delay in filing annual return (S. 92). 
  • Every promoter, director, manager or other key managerial personnel who is in default for attachment of a statement of special business in a notice calling for general meeting (S. 102). 
  • Every officer in default for failure to provide a declaration regarding appointment of proxy in a notice calling for general meeting (S. 105).
  • The company and every officer in default including company liquidator for failure/delay in filing certain resolutions (S. 117).
  • The company and every officer in default for failure/delay in filing report on Annual General Meeting conducted by public listed company (S. 121).
  • The company, the managing director and the chief financial officer of the company, directors for failure/delay in filing financial statement (S. 137).
  • Auditor for failure/delay in filing statement by auditor after resignation (S.140)
  • The company and every officer in default for failure/delay by company in informing Director Identification Number (DIN) of director (S. 157).
  • Individual or director of a company in default for contraventions (Non-compliance with Section 152 (Directors Appointment), Section 155 (Duplication of DIN) and Section 156 (Intimation of DIN)) related to DIN (S. 159).
  • Individual for accepting director position in violation of the Act (S. 165).
  • Person in default for allocating managerial remuneration in excess of permissible limits under the Act (S. 197).
  • The company, every director and key managerial personnel of the company who is in default for violating provisions related to appointment of Key Managerial Persons in certain class of companies (S. 203).
  • Director for noncompliance of provisions related to Registration of the offer of scheme involving transfer of shares (S. 238).

Imposition of stringent penalties for repeated defaults:

  • In general the adjudicating officer will provide the defaulter with the opportunity to rectify the default by issuing certain directions.
  • If the defaulter fails to comply with the directions of adjudicating officer and rectify the default then such failure would amount to non-compliance default.
  • With the inception of a new provision a defaulter (who has committed a second or subsequent default in relation to same cause of action within a period of 3 years from the occurrence of last default) will be penalized with an amount equivalent to twice the amount provided for such default under the relevant provision of Act.

Reduction of default cases burden on NCLT:

  • With the objective to condense the burden on the NCLT, the pecuniary jurisdiction limit of the Regional Director (RD) is enhanced in relation to compound offences. Accordingly, the RD pecuniary limit to compound offences is enhanced to a maximum of INR 25 lakhs which was 5 lakhs earlier (S. 441).
  • Prior in order to compound certain offences consent of the special court is mandatory However, such requirement is detached via latest company amendments (S. 441).
  • Corporate Governance Related Reforms
  • Company with share capital is obligated to submit a certificate of business commencement prior to starting its business operations or procurement of a loan in relation to the business commencement (Sec. 10A).
  • The Registrar is empowered to initiate the action to strike off the name of a company provided during the physical verification of such company registered office by Registrar it is identified by Registrar that the company is not carrying any business operations (S. 12).
  • Failure of any company/officer in charge to register the details of the significant beneficial owner (SBO) will expose such company/officer to fine/imprisonment or both (S. 90). It is the responsibility of the company to recognize the SBO – Any failure to recognize SBO would expose such company to punishment.
  • The central government is conferred with the authority to issue requisite regulations in this regard. If any company or person aggrieved by a tribunal order in this regard is provided with the opportunity to submit an application to relax/lift restrictions placed on the company within duration of one year from order date (S. 90).
  • Any person who has accepted the designation of director in excess of limits permissible under the Act will be disqualified to accept/act as a director (S. 164).
  • Corporate Social Responsibility
  • Within a period of six months from the financial year expiry every company is under the obligation to transfer any unspent amounts which is not related to any ongoing project to a Fund specified in the Act.
  • Pursuant to accomplishment of certain prescribed conditions every company is mandated to transfer the unspent amount which is related to any ongoing project into special account (Unspent Corporate Social Responsibility Account) opened with any scheduled bank within 3o days by the financial year end.
  • Funds transferred to the aforesaid special account will have to be spent by the company within a period of 3 years from the date of such transfer – Failure to spend such funds within the 3 year period will obligate the company to transfer such unspent funds to the account designated by the central government.
  • Non-compliance with the CSR provisions will expose the company to a minimum penalty of INR 50,000 to a maximum penalty of INR 25 lakhs and expose officer in default to imprisonment of 3 years/penalty (Minimum INR 50,000 to Maximum INR 5 lakh).
  • In order to make certain that companies will be complying with CSR provisions – The Ministry of Corporate Affairs is empowered with the authority to issue directions to certain class of companies in this regard.

Serious Fraud Investigation Office (SFIO):

  • Any person who is in default may be arrested by officer at rank of Assistant Director or above of SFIO pursuant to S.212 of the Act.
  • Within 24 hours of arrest such officer may have to take the arrested person to any designated Magistrate/Officer.
  • If any SFIO investigation report reflects any commission of fraud by a director, key managerial personnel or other officer in any company by taking undue advantage of such position then the central government has the authority to file disgorgement application against such director, key managerial personnel or other officer in the designated tribunal – Such fraudster may be charged with personal liability with no limitations on liability.

List of some other Amendments:

  • Rules are relaxed to reduce compliance burden and to facilitate the companies to file the prospectus copy with the Registrar rather than the registration of the prospectus with the Registrar of Companies (ROC) (Sec. 26). Accordingly in S.35 of the Act, the phrase (Filing of copy of Prospectus with the Registrar) is included as a replacement to the phrase (Registration of Prospectus with the Registrar).
  • The word ‘Public’ is detached from S.29(1)(b) of the Act to empower the central government to direct certain class of companies to mandatorily issue the securities in de-materialized form.
  • A governing body under the name (National Financial Reporting Authority – NFRA) will be assigned with certain functions and duties as directed by the central government from time to time – NFRA will contain Chairperson and certain number of full time members to perform the NFRA functions/duties (S. 132).
  • No person will be inducted into the NFRA body in the role of auditor or to perform any valuation under the S.247 of Act by NFRA if such person has the track record of professional misconduct (S. 132).
  • If the central government has the reason to believe any officer in charge of a company is indulged in unlawful acts – Then the central government has the authority to submit an application to designated tribunal seeking its decision on eligibility of such officer in charge to continue or not to continue in the office (S. 241).
  • Accordingly the designated tribunal has the authority to decide eligibility of such officer in charge to hold or not to hold such position in relation to conduct/management of company affairs (S. 242).
  • If the designated tribunal decides to expel such officer in charge from holding such position then such officer in charge will be prohibited from holding such position for a period of 5 years from the date of tribunal order (S. 243).
  • Such expelled officer in charge is not eligible to receive any compensation for the loss/termination from the job. The central government has the authority to permit such expelled officer in charge to assume the same position prior to completion of the banned period subject to the written permission of the designated tribunal.

The Companies Act Amendments will certainly:

  • Encourage the companies to put CSR funds to good use for the welfare of the society;
  • Streamline certain procedural aspects to get rid of the roadblocks which are hindering the enforcement of certain vital company provisions;
  • Empower the authorities with right tools to hunt down the fraudsters;
  • Diminish the compliance burden on the NCLT; and
  • Ultimately uplift the corporate governance standards of the corporate sector
Did you find this write up useful? YES 1 NO 0
Nancy Graves   22 Mar 2023 8:37pm
I was a subject of a cryptocurrency heist. Some amount of bitcoin was stolen from my wallet and diverted to an unpermitted account. My wallet management was informed, however, they had me wait a week before responding through email. They didn’t offer any assistance; alternatively, they mentioned that my phone might have been compromised and told me to get in touch with the authorities who couldn't provide any solution to recover my bitcoin. When I was browsing through the internet trying to find a solution to get my stolen bitcoin back, I discovered a team of bitcoin recovery experts called Astraweb Cyber. I then decided to contact them for assistance in getting my stolen money back. I have nothing but praise for Astraweb Cyber because they were able to assist me in recovering the money that had been stolen. With the use of their sophisticated tools, Astraweb Cyber was able to determine how the transaction was carried out. I have my money back and I am very thankful to Astraweb Cyber for their amazing service. If you have any issues related to mine. Kindly contact them via email. (astraweb@cyberdude. com)
Amelia Claudien   21 Mar 2023 3:41pm
I lost a lot of money a month ago when I saw the opportunity to invest in cryptocurrency and this is why I suggest to everyone out there to seek more knowledge before investing in cryptocurrency as there are people out there who seize this opportunity to defraud victims of their hard-earned money through cryptocurrency investment. I was lucky enough to do my research and found out I have been coined of $892,000 worth of Bitcoin & Ethereum after falling victim but it was not long after I discovered the services of SPYWEB CYBER TEAM, who took some information from me to investigate and recover all the money that I lost in this scam. I’m truly grateful for the service of SPYWEB CYBER, the best cryptocurrency recovery team out there. If you need the services of SPYWEB CYBER TEAM to help you recover your cryptocurrency without any delay, you should contact them at one of the Email addresses listed below. CONTACT INFO: SPYWEB@CYBERDUDE . COM CONTACT@SPYWEB . TECH
  20 Mar 2023 10:08pm
I'm so happy that I finally won $13.3 million Mega Millions lottery jackpot, I took an advice from someone who talked about this great spell caster called Dr Lucas, the person placed a testimonies on a blog saying how Dr Lucas helped him win the lottery by sending him the winning number I was curious and I thought it was all joke not until I contacted this spell caster to know for myself how this work cause I have spend a lot buying tickets and I never won anything. I contacted him and he told me the necessary thing that needed to be done and I did it and he told me to wait for 3days and truly he gave me the winning numbers to play the lottery which I did, Can you believe my name was the first among winners. He told me (my daughter all I need you to do for me is make sure that you share this testimonies to others so that they can also win the lottery cause I do not have much time to spend on the internet) so that is why I am sharing this testimony with you that if you want to win the lottery this is how you will reach him through his Email address: or Whats-App him on +2349047943567 This the only answer to that your prayers of winning the lottery
Debbie Arnold  15 Mar 2023 3:26pm
I am out here to speed this good news to the entire world on how I got help from Dr Kachi a great lottery spell caster that will help you cast a lottery spell and give you the rightful numbers to win the lottery, I didn't believe lottery spell at first but as life got harder i decided to give a try, I spend so much money on tickets just to make sure I win. until the day I met Dr KACHI online, which so many people have talked good about, that he is very great when it comes to casting lottery spell, he told me the necessary things to do and behold it was like a magic, i won $20 Million Dollars Florida Powerball Double Play with the numbers Dr Kachi gave to me. his a really trustful person worthy and reliable, i am sharing this to you who have been finding it so hard to win the lottery, Thanks you Dr. Kachi who helped me contact email OR Text Number and Call: +1 (209) 893-8075 Visit his Website:
Debbie Arnold  10 Mar 2023 9:47pm
I am out here to speed this good news to the entire world on how I got help from Dr Kachi a great lottery spell caster that will help you cast a lottery spell and give you the rightful numbers to win the lottery, I didn't believe lottery spell at first but as life got harder i decided to give a try, I spend so much money on tickets just to make sure I win. until the day I met Dr KACHI online, which so many people have talked good about, that he is very great when it comes to casting lottery spell, he told me the necessary things to do and behold it was like a magic, i won $20 Million Dollars Florida Powerball Double Play with the numbers Dr Kachi gave to me. his a really trustful person worthy and reliable, i am sharing this to you who have been finding it so hard to win the lottery, Thanks you Dr. Kachi who helped me contact email OR Text Number and Call: +1 (209) 893-8075 Visit his Website:
Michelle Johnson  28 Feb 2023 3:47pm
There are many reasons why you might need a hacker, and one of them is; if you have ever thought your partner was cheating on you even when they were not, you are not alone. The only genuine and reliable hacker I have come across is Spytech Hacker. This is because for many months now I have been looking for a way to check my husband’s WhatsApp, iMessage, Emails, Facebook messages and all details about his phone. Spytech Hacker just sent me a spy program to use on my PC to gain access. I logged in and gained access into their servers to check messages. This is super easy to use and a smooth interface which is a friendly option, I'm currently watching messages pop up from his phone in real-time and also deleted messages. You can contact Spytech Hacker via Email at hackerspytech @ gmail com This is why you need a hacker like Spytech hacker service, he is a professional hacker who can provide you with any hacking services that you need
Wilkins Tamonte   20 Feb 2023 8:24am
The last time I was in a pickle I had to think outside the box. After searching far and wide in the internet I bumped into this professional team of hackers who offered me with a non conventional solution to my said problem. I don't want to incriminate myself by getting into the finer details of it but they did me a solid. Recommending them to others is the least I could do to express my gratitude. If you are ever in need of all things hacking, email They offer professional hacking services such as but not limited to: -University/College grades manipulation -Bank accounts manipulation -Criminal records manipulation -Facebook account hacking -Twitter account hacking -Email account hacking -Website hacking -Server hacking -Skype hacking -Online databases hacking -Word Press Blogs hack -Individual computer hacking -Control devices remotely hack -Burner numbers hacks -Verified Paypal Accounts hacking -Any social media account hack -Android & iPhone hacking -Text message interception hacking -Email interception hacking -Untraceable Ip, Ghost surfing. -Monitoring SMS text messages remotely. -Cell phone GPS location tracking. -Spy on Whatsapp Messages. -Track BBM messages and Line messages. -View All Photos Captured in Gallery. -Remote homespying -Read phone Access Address Book -Track Internet Browsing History They don't do much talking they get down to hacking. Very fast and efficient you'll keep on coming back for more hacking solutions. I know I did. Hack the system and always be ahead of the pack with grayhathacks. Contact them via email at for all your quick fixes and solutions.
Evans   13 Feb 2023 5:30am
When it comes to data recovery, it's a tough task to find someone you can trust. That was the case for me when my laptop was stolen and I was desperate to recover my sensitive work files before they were leaked. Thankfully, I was referred to hire Grayhathacks and boy was I glad I did. I have to admit I was skeptical at first considering the nature of the data to be recovered but I was desperate. Grayhathacks came highly recommended so I decided to take my chances with them. The professionals at Grayhathacks were incredibly dedicated and responsive. They worked tirelessly to recover my data and used the most advanced technology available to erase any sensitive files from my laptop. In a matter of hours, they managed to do what I thought was impossible, and I was able to recover all my lost data hence saving my job. Grayhathacks is a team of true professionals. Their expertise and discretion are second to none and I am forever in their debt. They knew just how important my data was and they did not take a single second to rest until my data was safe and secure. I cannot thank them enough for the incredible job they did. If you are looking for a team of professionals who can provide exceptional data recovery services with the utmost discretion and care, then Grayhathacks is the perfect choice. You can contact them via email at if you are ever in need of such kind of services.
zachery franklin   8 Dec 2022 5:21pm
Crypto currency is not always how it sounds or how you thought it might be for you . I’m saying this out of my own very experience with brokers , I was investing with this company for quite some time , let’s say roughly a month but I never thought of taking out my withdrawals though I did just one certain time and I was paid out my profits , ever since then I never had no doubts about them until of recent when the company logged me out of my account with my earnings stuck in there , when reaching the support I was told that a certain fee was to be paid for some reasons that they gave which never made sense to me , I paid the said amount to unlock back my account because I couldn’t afford loosing all the funds left in there , but at the end of everything my account was still locked and that was when I became suspicious about them and then reached out to a recovery hacker I read about on “ Coach me “ to see if I could by any means get back my funds in whole , and to my greatest surprise he was able to crack the website and get back my funds within just 48 hours .. I’m glad I didn’t lose the funds to these ingrates . So my advice here is that you guys out there should be careful while trying to invest with any broker and if you find yourself as a victim already then contact the hacker team on telegram @ Virtualhacknet or through email : VIRTUALHACKNET@ gmail. com .
Daisey Hatley   1 Dec 2022 6:48pm
I got caught up alongside my cousin in an investment scam that toned to a total of £527,000 if put together , my cousin was who brought up the idea of investing in crypto as it seemed to be very profitable now , the first few investment was really profitable just like we thought of and that made us invest even more but when we realized it was a scam website it was already too late for us to back off but since we couldn’t back off on time we also decided not to give up on getting our funds back , this was our lifetime savings we’re talking about here and without any further delay we made contact with a recovery agent ‘VIRTUALHACKNET@gmail. com ‘ this team right here was our life savior at that point , we were able to recover our funds all back as it was still a Fresh case as he said and it was going to be an easy one to trace . The best part of it all is him keeping to his words of recovering the funds .. it was really a pleasure working with such honest personality , you’d need to be willing to help yourself for the help you need to come through .

C2RMTo Know More

Something Awesome Is In The Work









Sign-up and we will notify you of our launch.
We’ll also give some discount for your effort :)

* We won’t use your email for spam, just to notify you of our launch.

SAARTHTo Know More

Launching Soon : SAARTH, your complete client, case, practise & document management SAAS application with direct client chat feature.

If you want to know more give us a Call at :+91 98109 29455 or Mail