New Delhi: To improve the ease of doing business, the Cabinet Wednesday cleared amendments to the companies law that would do away with compulsory declaration by a firm before commencing business.
This is the second time that changes have been proposed to the Companies Act, 2013 since Prime Minister Narendra Modi-led government came to power in May 2014.
Apart from doing away with the declaration requirements for starting new business, the latest changes are also aimed to ensure speedier issuance of final notifications with regard to modification or exemption from provisions of the Act.
The amendments were approved at a meeting of Union Cabinet and and would now be part of the Companies (Amendment) Bill, 2014.
The Bill was cleared by Lok Sabha in December last year.
According to an official release, the latest amendments would "address issues related to ease of doing business and put in place a speedier process for approval of draft notifications for providing exemptions etc from specific provisions of the Act to a class of companies".
One of the amendment is to do away with the requirement for filing a declaration by a company before commencement of business or exercising its borrowing powers.
Another change proposed is for "rationalising the procedure for laying draft notifications granting exemptions to various classes of companies or modifying provisions of the Act in Parliament, in order to ensure speedier issue of final notifications".
The government has said it wants to improve India's position to top-50 in terms of ease of doing business, from 142nd currently, as per the latest World Bank report in this regard.
A number of changes have already been proposed in the Companies Act in the recent months.
Among the 14 amendments cleared by the Lok Sabha last year is relaxation to a number of norms including those pertaining to related party transactions. Also, resolutions passed by companies' boards would not be subjected to public inspection. There is also a provision to give severe punishment for those raising illegal deposits from the public.
