New simplified Company Act to be introduced soon

Kolkata, Jul 04 (UNI) The Centre is all set to formulate a new Company law by June, 2007, through an act of Parliament, bringing about sweeping changes in present company regulations to make it far more simple in every respect.

Announcing this, Union Minister of Company Affairs Prem Chand Gupta informed the members of Indian Chamber of Commerce here today that a Bill in this regad would be placed in the coming winter session of Parliament in accordance with the wishes of Prime minister Manmohan Singh so that the Act could be enacted by the middle of next year after completing all the necessary formalities.

He said following the enactment of the new Company law the number of its present regulations would come down from 786 to around 400 to make it compatible with world standard.

At present, the Union Minister quoting from a WTO report said, India was considered to be the "77th preferred nation" for setting up any new company in the country by a foreign multinational, while after the formulation of the new law India was likely to be among the ten most preferred nations in the world under the same category.

Referring to other steps being taken by the Union Company Affairs Ministry in order to bring about sweeping changes in the work culture, Mr Gupta said keeping this in mind the initiative to introduce MCA-21 scheme was taken in a time-bound manner.

He said under MCA 21 scheme of electronic filing of documents, all the 20 Registrars of Company(ROC) offices in the coutry would come under it by next year. So far 12 of the 20 offices, including those in New Delhi, Mumbai and Chennai, had already introduced the project, thereby converting all of them into paperless offices.

Among his other plans, Mr Gupta said they had decided to introduce a separate Bill in the coming Monsoon session of Parliament on the Limited Liability Partnership(LLP) to help the Small and Medium Sector Enterprises(SMEs) operate more smoothly besides being able to form partnership company with like-minded entrepreneurs under a new business environment.

When passed it would open a new vista for further growth of the SME units in the country, the Union Company Affairs Minister opined.

Earlier on his arrival at the Chamber, Mr Gupta was welcomed by ICC president and noted industrialist S K Bangur, who also highlighted some of the basic problems being faced by the industry in dealing with Company laws.

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