Shardul Shroff, Ajay Bahl on Company Law Committee to suggest reforms in Companies Act and LLP Act

The Central Government has constituted a Company Law Committee to look into recommendations on various provisions of the Companies Act, 2013 and the Limited Liability Partnerships Act, 2008. 

The Company Law Committee will be chaired by Secretary of the Ministry of Corporate Affairs, Injeti Srinivas. 

Among those who have been appointed as members of this Committee are Shardul S Shroff, Executive Chairman of Shardul Amarchand Mangaldas, and Ajay Bahl, Founder and Managing Partner of AZB & Partners. 

A Joint Secretary (Policy) has also been designated as Member Secretary of the 11-member Committee. The seven others appointed as members of the committee are as follows:

• Dr TK Vishwanathan, Ex-Secretary General of the Lok Sabha
• Udhay Kotak, Managing Director of Kotak Mahindra Bank
• Amarjit Chopra, Senior Partner at GSA Associates
• Rajib Sekhar Sahoo, Principal Partner at SRB & Associates
• G Ramaswamy, Partner at G Ramaswamy & Co. Chartered Accountants
• Sidharth Birla, Chairman of Xpro India Limited
• Preeti Malhotra, Group President, Corporate Affairs & Governance at Smart Group

The order released by the Ministry of Corporate Affairs states,

“In line with the Government’s objective of promoting Ease of Living in the country by providing Ease of Doing Business to law abiding corporates, fostering improved corporate compliance for stakeholders at large and also to address emerging issues having impact on the working of corporates in the country, it has been decided to constitute a Company Law Committee for examining and making recommendations to the Government on various provisions and issues pertaining to implementation of the Companies Act, 2013 and the Limited Liability Partnership Act, 2008.”

The terms of reference of the Committee include:

• Analyse the nature of the offences (compoundable and non-compoundable) and submit its recommendation as to whether any of the offences could re-categorised as ‘civil wrongs’ along with measures to optimise the compliance requirements under the Companies Act 2013 and concomitant measures to provide for the Ease of Doing Business;
• Examine the feasibility of introducing settlement mechanism, deferred prosecution agreement, etc. within the fold of the Companies Act 2013; 
• Study the existing framework under the Limited Liability Partnership Act 2008 and suggest measures to ply the gaps, if any, while at the same time enhancing the Ease of Doing Business;
• Propose measures to further de-clog and improve the functioning of the NCLT;
• Suggest measures for removing any bottlenecks in the overall functioning of statutory bodies like SFIO, IEPFA, NFRA etc. under the Act;
• Identify specific provisions under the Companies Act 2013 and the Limited Liability Partnership Act 2008 which are required to be amended to bring about greater Ease of Living for the corporate stakeholders including but not restricted to review Forms under the two Acts;

The Committee is to have a one year tenure from the date of its first meeting. It is expected to submit its recommendations in phases to the government from time to time, as may be decided by the Chairperson. 

Shroff and Bahl were also part of the 10-member Committee set up to review the penal provisions under the Companies Act, 2013 last year.

Read the order: