Aug. 28, 2018

Committee chaired by Injeti Srinivas – for reviewing penal provisions of Company act 2013 – submitted its report making several recommendations for improving Corporate Governance.

Key recommendations:

  1. Restructure Corporate Offences to relieve Special Courts from adjudicating routine offences:
    1. Institute a transparent online platform for E-adjudication and E-publication of orders.

    2. Re-categorize 16 out of the 81 compoundable offences by shifting them from the jurisdiction of special courts to an in-house E-adjudication framework.

  2. De-clogging the National Company Law Tribunal (NCLT) by through significant reduction in compounding cases before the Tribunal;

  3. Re-introduction of declaration of commencement of business provision to better tackle the menace of ‘shell companies’;

  4. Imposition of a cap on independent director’s remuneration in terms of percentage of income in order to prevent any material pecuniary relationship;

  5. Non-maintenance of registered office to trigger de-registration process;

  6. Holding of directorships beyond permissible limits to trigger disqualification of such directors;

  7. Greater disclosures with respect to public deposits to prevent abuse and harming of public interest.

Source : PIB