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On 18th December, 2012 the Lok Sabha passed the much expected Companies Bill, 2012 to replace the existing Companies Act, 1956, one of the most important legislation governin g all companies in
India for the past 56 years. The Bill has 470 clauses as against 658 Sections in the existing Companies
Act, 1956.
Comparison of Companies Act, 1956 and Companies Bill, 2012
Basis of Comparison
Companies act ,1956
Companies Bill,2012
Maximum number of 50 (Fifty) members for private company 200 (Two Hundred)
Minimum Number of Public Company - 7 members Private Company - 2
No change for private and public companies.
New concept of one person company introduced which can have a single member
Object Clause of
MOA
Object clause consists of
Main Objects, Incidental or
Ancillary Objects and Other
Objects.
MOA to contain the objects for which the company is proposed to be incorporated and any matter considered necessary in furtherance thereof.
Issue of Preference
Shares for more than
20 years
Prohibited
Permitted, only for infrastructure projects
Maximum time for 18 months from 9 Months from closure of holding first AGM incorporation or 9 months accounts from closure of accounts, whichever is earlier
Mode of Notice for Written Notice mandatory holding AGM
Statutory Meeting
In writing or in electronic form. For
Public
company No provision mandatory to hold after 1 month but before 6 months from the date of entitlement to commence business.
Basis of Comparison
Companies act ,1956
Maximum Number of 12
Directors
Companies Bill,2012
15
More than 15 can also be appointed by passing special resolution at EGM
Certification of By Manager or Secretary, if Chairman alone can sign if so
Financial Statements any, and by not less than 2 authorized by the Board. directors one of whom shall be the MD where there is one. Cross Border Mergers
No Specific Provisions
Merger of
India for the past 56 years. The Bill has 470 clauses as against 658 Sections in the existing Companies
Act, 1956.
Comparison of Companies Act, 1956 and Companies Bill, 2012
Basis of Comparison
Companies act ,1956
Companies Bill,2012
Maximum number of 50 (Fifty) members for private company 200 (Two Hundred)
Minimum Number of Public Company - 7 members Private Company - 2
No change for private and public companies.
New concept of one person company introduced which can have a single member
Object Clause of
MOA
Object clause consists of
Main Objects, Incidental or
Ancillary Objects and Other
Objects.
MOA to contain the objects for which the company is proposed to be incorporated and any matter considered necessary in furtherance thereof.
Issue of Preference
Shares for more than
20 years
Prohibited
Permitted, only for infrastructure projects
Maximum time for 18 months from 9 Months from closure of holding first AGM incorporation or 9 months accounts from closure of accounts, whichever is earlier
Mode of Notice for Written Notice mandatory holding AGM
Statutory Meeting
In writing or in electronic form. For
Public
company No provision mandatory to hold after 1 month but before 6 months from the date of entitlement to commence business.
Basis of Comparison
Companies act ,1956
Maximum Number of 12
Directors
Companies Bill,2012
15
More than 15 can also be appointed by passing special resolution at EGM
Certification of By Manager or Secretary, if Chairman alone can sign if so
Financial Statements any, and by not less than 2 authorized by the Board. directors one of whom shall be the MD where there is one. Cross Border Mergers
No Specific Provisions
Merger of