A Company Law Committee is constituted by the government to ease business norms for companies in India so that there is more ease in doing business.
According to the Ministry of Corporate Affairs, the government’s objectives for the corporate sector are as follows:
- Promote the Ease of Doing Business for Law Abiding Corporates,
- Improve Corporate Compliance for Stakeholders
- Address emerging issues that impact the daily lives of companies in India
In order to achieve these objectives, the government found it necessary to set up an 11-member panel, called the Company Law Committee (hereafter referred to as the ‘Committee’) headed by Corporate Affairs Secretary, Injeti Srinivas for the purpose of de-clogging and improving the functioning of the National Company Law Tribunal (NCLT).
Other members of the panel includes Uday Kotak, MD of Kotak Mahindra Bank, Xpro India Chairman Sidharth Birla; Shardul S Shroff, Executive Chairman at Shardul Amarchand Mangaldas & Co; Ajay Bahl, Founder & Managing Partner at AZB & Partners, Advocates & Solicitors and T K Viswanathan, ex- secretary-general, Lok Sabha.
The committee is also set up to analyze and make recommendations on issues that affect the implementation of the Limited Liability Partnership Act,2008, and the Companies Act, 2013.
The Committee has also been empowered to identify the provisions of the Companies Act, and the Limited Liability Partnership Act, which needs to be amended. These amendments are geared towards improving the ease of living for corporate stakeholders.
Other functions which the Committee has been empowered to carry out are as follows:
- Examine whether or not it is feasible to introduce settlement mechanisms.
- Examine the need for deferred prosecution agreement.
- Examine the nature of the offenses under the Act, and recommended whether or not the offenses have to be recategorized as ‘civil wrong’.
- Make recommendations on the measures to be used to optimize compliance requirements under the Companies Act.
- Propose measures that will de-clog and improve the functioning of the NCLT.
- Study the existing framework under the Partnership Act, and make suggestions that will help fill any gaps, and enhance the ease of doing business.
- Suggest measures that will help in removing the bottlenecks in the functioning of statutory bodies like serious fraud investigation office (SFIO).
These functions are to be carried out within the fold of the Companies Act. And of course, the committee does not function unsupervised. It is required to submit all its recommendations on every subject to the government. This submission is to be done in phases, from time to time, as decided by the chairman of the committee.
The tenure of the Committee is one year from the date of its meeting and the committee would submit its recommendations to the government from time to time in phases and subject-wise as may be decided by the chairperson.