Companies Bill 2008 - Intends to modernize structure for Corporate Regulation in the country
The much-awaited Companies Bill, 2008 has been introduced in the Lok Sabha . More than five years ago, the Government had introduced the Companies (Amendment) Bill, 2003 in the Rajya Sabha on 7.5.2003, which is now withdrawn.
The Companies Bill, 2008 is intended to modernize the structure for corporate regulation in India and represents a major reform statement by the Government to promote the development of the Indian corporate sector through enlightened regulation.
The comprehensive revision of the Companies Act, 1956 was taken up by the Ministry since not only had the number of companies in India expanded from about 30,000 in 1956 to above 7 lakhs today, the Indian corporate sector had also transformed itself in a manner that was unimaginable even a decade ago.
The Companies Bill, 2008 seeks to enable the corporate sector in India to operate in a regulatory environment of best international practices that foster entrepreneurship, investment and growth.
The Bill reinforces shareholders democracy, facilitates e-Governance in company processes, recognizes the liability of Boards , directors and senior management personnel of companies, provides for a new scheme for penalties and punishment for non compliance or violation of the law, harmonizes corporate regulation with action by sectoral regulators, incorporates a new framework for mergers and amalgamations of companies and provides an extensive Insolvency Code based on the latest principles recommended by the United Nations Commission on International Trade Law (UNCITRAL).