The Indian parliament Thursday gave its nod to the Companies Bill, 2012. Here are the salient features of the new bill:

 

 

 — Companies are required to spend at least two percent of their net profit on Corporate Social Responsibility.

 

 — To help in curbing a major source of corporate delinquency, introduces punishment for falsely inducing a person to enter into any agreement with bank or financial institution, with a view to obtaining credit facilities.

 

 — The limit in respect of maximum number of companies in which a person may be appointed as auditor has been proposed as 20.

 

 — Independent directors’ shall be excluded for the purpose of computing ‘one third of retiring directors'.

 

 — Appointment of auditors for 5 years shall be subject to ratification by members at every Annual General Meeting.

 

 — ‘Whole-time director’ has been included in the definition of the term ‘key managerial personnel'. 

 

 — The term ‘private placement’ has been defined to bring clarity. 

 

 — Maximum number of directors in a private company increased from 12 to 15 which can be increased further by special resolution.

 

 — Financial Year of any company can end only on March 31 and only exception is for companies, which are holding / subsidiary of a foreign entity requiring consolidation outside India, can have a different financial year with the approval of Tribunal.

 

IANS