Section 1, 2, 3A, 4 and 7 of Companies Amendment Act 2017

Short title and commencement.

1. (1) This Act may be called the Companies (Amendment) Act, 2017. (2) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint and different dates may be appointed for different provisions of this Act and any reference in any provision to the commencement of this Act shall be construed as a reference to the coming into force of that provision.

Amendment of section 2 of Companies Act 2013

2. In section 2 of the Companies Act, 2013 (hereinafter referred to as the principal Act),- (i) in clause (6), for the Explanation, the following Explanation shall be substituted, namely:- 'Explanation.-For the purpose of this clause,- (a) the expression "significant influence" means control of at least twenty per cent. of total voting power, or control of or participation in business decisions under an agreement; (b) the expression "joint venture" means a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement;'

(ii) for clause (28), the following clause shall be substituted, namely:-
'(28) "Cost Accountant" means a cost accountant as defined in clause (b) of sub-section (1) of section 2 of the Cost and Works Accountants Act, 1959 and who holds a valid certificate of practice under sub-section (1) of section 6 of that Act;';

(iii) in clause (30), the following proviso shall be inserted, namely:-
"Provided that-
(a) the instruments referred to in Chapter III-D of the Reserve Bank of India Act, 1934; and
(b) such other instrument, as may be prescribed by the Central Government in consultation with the Reserve Bank of India, issued by a company, shall not be treated as debenture;";

(iv) in clause (41), in the first proviso, after the word "subsidiary", the words "or associate company" shall be inserted;

(v) in clause (46), the following Explanation shall be inserted, namely:-
'Explanation.-For the purposes of this clause, the expression "company" includes any body corporate;';
(vi) clause (49) shall be omitted;
(vii) in clause (51),-
(a) in sub-clause (iv), the word "and" shall be omitted;
(b) for sub-clause (v), the following sub-clauses shall be substituted, namely:-
"(v) such other officer, not more than one level below the directors who is in whole-time employment, designated as key managerial personnel by the Board; and
(vi) such other officer as may be prescribed;";
(viii) in clause (57), for the words "and securities premium account", the words ", securities premium account and debit or credit balance of profit and loss account," shall be substituted;
(ix) in clause (71), in sub-clause (a), after the word "company;", the word "and" shall be inserted;
(x) in clause (72), in the proviso, in clause (A), after the words "State Act", the words "other than this Act or the previous company law" shall be inserted;
(xi) in clause (76), for sub-clause (viii), the following sub-clause shall be substituted, namely:-
"(viii) any body corporate which is-
(A) a holding, subsidiary or an associate company of such company;
(B) a subsidiary of a holding company to which it is also a subsidiary;
or
(C) an investing company or the venturer of the company;";
Explanation.-For the purpose of this clause, "the investing company or the venturer of a company" means a body corporate whose investment in the company would result in the company becoming an associate company of the body corporate.

(xii) in clause (85),-
(a) in sub-clause (i), for the words "five crore rupees", the words "ten crore rupees" shall be substituted;
(b) in sub-clause (ii),-
(A) for the words "as per its last profit and loss account", the words "as per profit and loss account for the immediately preceding financial year" shall be substituted;
(B) for the words "twenty crore rupees", the words "one hundred crore rupees" shall be substituted;

(xiii) in clause (87), in sub-clause (ii), for the words "total share capital", the words "total voting power" shall be substituted;
(xiv) for clause (91), the following clause shall be substituted, namely:-
'(91) "turnover" means the gross amount of revenue recognised in the profit and loss account from the sale, supply, or distribution of goods or on account of services rendered, or both, by a company during a financial year;'.

Insertion of new section 3A. Members severally liable in certain cases

3. After section 3 of the principal Act, the following section shall be inserted, namely:- "3A. If at any time the number of members of a company is reduced, in the case of a public company, below seven, in the case of a private company, below two, and the company carries on business for more than six months while the number of members is so reduced, every person who is a member of the company during the time that it so carries on business after those six months and is cognisant of the fact that it is carrying on business with less than seven members or two members, as the case may be, shall be severally liable for the payment of the whole debts of the company contracted during that time, and may be severally sued therefor."

Amendment of section 4 of Companies Act 2013

4. In section 4 of the principal Act, in sub-section (5), for clause (i), the following shall be substituted, namely:- "(i) Upon receipt of an application under sub-section (4), the Registrar may, on the basis of information and documents furnished along with the application, reserve the name for a period of twenty days from the date of approval or such other period as may be prescribed: Provided that in case of an application for reservation of name or for change of its name by an existing company, the Registrar may reserve the name for a period of sixty days from the date of approval.".

Amendment of section 7 of Companies Act 2013

5. In section 7 of the principal Act, in sub-section (1), in item (c), for the words "an affidavit", the words "a declaration" shall be substituted

Amendment of section 12 of Companies Act 2013

6. In section 12 of the principal Act,-
(i) in sub-section (1), for the words "on and from the fifteenth day of its incorporation", the words "within thirty days of its incorporation" shall be substituted;

(ii) in sub-section (4), for the words "within fifteen days", the words "within thirty days" shall be substituted.