Amendment in Companies bill to reduce NCLT burden for insolvency cases
To improve ease of doing business, the Lok Sabha on Friday passed the Companies (Amendment) Bill, 2018, designed to reduce the National Company Law Tribunal's (NCLT) burden in the volume of insolvency cases, as well as prescribe strong action against non-compliant companies.
Moving amendments to the Bill before it was passed by a voice vote, the Minister of State for Corporate Affairs P.P. Chaudhary said the Bill aims to de-clog the special courts and the NCLT. "It will also reduce the burden on NCLT and special courts and improve ease of doing business in the country," he said.
The Bill has necessitated as the Companies (Amendment) Ordinance, 2018 was promulgated on November 2, 2018. It amends several provisions in the Companies Act, 2013, relating to penalties, among others. It is based on the recommendations of a government-appointed committee to review offences under the Companies Act in order to promote ease of doing business along with better corporate compliance.
The panel suggested various changes to the Act last August, including the restructuring of corporate offences under the companies law and an in-house adjudication mechanism to ensure courts are left free to deal with serious violations. A total of 16 types of corporate offences have been shifted from special courts to in-house adjudication, increasing the scope of in-house assessment from 18 to 34 Sections of the Act. The Bill also calls for instituting a transparent and technology-driven in-house adjudication mechanism on an online platform and publication of the orders on the website.
(With inputs from agencies.)
Download The Devdiscourse News App for Latest News.