Cos Bill likely in budget session

The government said it is hopes to present the new Companies Bill in the upcoming Budget Session of Parliament.

“It (Companies Bill) has been sent back to the Parliamentary Standing Committee. They have told me that they will send it back in a month’s time and allow me to present it in Parliament in the Budget session,” Corporate Affairs Minister Veerappa Moily said.

He was speaking to reporters on the sidelines of the National CSR Conference here.
The Companies Bill 2011, which was listed for passage in the Winter Session, was strongly opposed by the opposition parties and UPA ally Trinamool Congress, as they said this was virtually a new Bill with considerable alterations to the earlier provisions.

The Bill was sent back to the Parliamentary Standing Committee on Finance. The new legislation seeks to replace the half-a-century old Companies Act, 1956, and modernise corporate practices in line with developments taking place across the globe.

The Bill will introduce new rules, covering areas such as corporate social responsibility (CSR), class action suits and fixed term for independent directors. It also proposes to tighten laws for raising money from the public.

The Bill also seeks to strongly check insider trading by company directors or key managerial personnel by treating such activities as a criminal offence.

Further, it has proposed that companies should earmark 2 per cent of the average profit of the preceding three years for CSR activities and make a disclosure to shareholders about the policy adopted in the process.