Key Developments Related to the Ministry of Corporate Affairs
In 2024, the government launched the Prime Minister’s Internship Scheme to provide 1 crore internships in top 500 companies over five years. The scheme offers:
- Financial assistance of ₹5,000 per month, with ₹4,500 from the Union Government and ₹500 from CSR funds.
- A one-time grant of ₹6,000 for incidentals per intern.
- Internships lasting 12 months.
The pilot project, launched on October 3, 2024, aims to provide 1.25 lakh internships during FY 2024-25. Partner companies have already posted 1.27 lakh opportunities, receiving 6.21 lakh applications.
Migration to MCA V3: Simplifying Compliance
The Ministry successfully migrated MCA 21 from Version 2 to Version 3, streamlining compliance:
- Reduced compliance forms from five to three.
- Fully online fund transfer processes through a Straight Through Process (STP).
- A dedicated dashboard for Nodal Officers to manage verification reports.
Jan Vishwas Initiatives: Simplifying Share and Security Processes
- Legal Heirship Certificate for Share Transmission
- Legal heirship certificates now validate share transmission, eliminating the need for succession certificates or probate.
- This reform saves time and costs for beneficiaries navigating inheritance complexities.
- Streamlined Lost Share Certificate Process
- Filing an FIR for lost certificates valued up to ₹5 lakh is no longer required.
- No Surety Required for Duplicate Physical Certificates
- The elimination of surety requirements simplifies replacing lost or damaged certificates.
Enhanced Grievance Redressal by IEPFA
The IEPFA revamped its grievance redressal mechanism with:
- A multilingual IVRS system available in six languages via a five-digit short code (14453).
- Initiatives like Niveshak Sunwai, Niveshak Panchayat, and Niveshak Saarthi, promoting inclusivity and financial literacy.
Integrated Technology Platform Under IBC
The government proposed an Integrated Technology Platform under the Insolvency and Bankruptcy Code (IBC) to:
- Automate processes, file applications, and deliver notices.
- Improve transparency, minimize delays, and enhance stakeholder participation.
Insolvency and Bankruptcy Code Achievements
The IBC facilitated:
- Resolution of ₹10.22 lakh crore default cases pre-admission by March 2024.
- Completion of 1,068 CIRPs with an average realization of 86.13% of the corporate debtor’s fair value.
- Over 3,409 corporate debtors navigating insolvency processes, achieving a 161% realization rate against liquidation value.
Competition Commission of India (CCI) Milestones
The CCI achieved:
- Disposal of 99% of combination cases by September 2024.
- Approval of significant mergers in financial, pharmaceutical, and digital sectors.
- Initiation of a study on competition issues in renewable energy across BRICS nations.
Improved Filing Rates and Advisory Initiatives
- Compliance with Section 148 of the Companies Act rose, with a 35% increase in CRA-2 filings and a 36% rise in CRA-4 filings in FY 2023-24.
- Timely submission of Cost Audit Reports improved by 14% due to proactive advisories.
Examination of Existing Framework of Cost Audit and its Rules:
- To review the existing framework of Cost Records and Cost Audit and to improve the usefulness of the Cost Audit Reports in various sectors of the economy, a Committee was constituted in October, 2023 by MCA.
- The Committee’s report has been placed on the website of MCA inviting comments from the stakeholders.
- Based on the stakeholders comments, recommendations of the Committee will be examined and the framework governing Cost Record and Audit will be amended.
Central Processing Centre (CPC)
The CPC, launched in 2024, manages e-form processing and statutory compliance under the Companies Act.
CPACE for Accelerated Corporate Exit
CPACE reduced corporate exit processing time from two years to 90 days by FY 2023-24. It also handles LLP closure applications, ensuring swift processing.
Amendments in Companies Act and L.L.P. Act
The Ministry decriminalized 63 provisions, introducing an electronic, faceless adjudication mechanism, eliminating the need for in-person hearings.
Updates to Indian Accounting Standards
- Ind AS 116: Amendments addressed leaseback transactions and introduced paragraph 102A.
- Ind AS 117: A new standard for insurance contracts was introduced.
Empowering Regional Directors
Amendments to CAA Rules empower Regional Directors to approve holding-subsidiary mergers in India, expediting the process.
Center for Processing Accelerated Corporate Exit (C-PACE)
- The Center for Processing Accelerated Corporate Exit (C-PACE), introduced in the 2022-23 budget, accelerates the voluntary closure process for companies. It has cut the closure time from about two years to under six months.
- Since its launch on May 1, 2021, C-PACE has streamlined and centralized the application process, reducing the average closure time to roughly 90 days in FY 2023-24. Additionally, it now processes Limited Liability Partnership (LLP) closure applications to enhance efficiency.
- The notification for C-PACE to manage LLP closure applications was issued on August 5, 2024, and became effective on August 27, 2024. By December 7, 2024, C-PACE had processed 4,640 LLP closure applications, demonstrating its commitment to fast processing.
Amendments to the Companies Act, 2013, and LLP Act, 2008
- Amendments to the Companies Act, 2013, and LLP Act, 2008, decriminalized 63 provisions, shifting defaults to an in-house adjudication system. The Registrar of Companies (RoC) currently handles default cases, requiring corporate representatives to attend hearings in person.
- To improve efficiency and reduce face-to-face interactions, the adjudication process has moved to an electronic, faceless system. This change removes in-person requirements at the RoC level, making the process smoother and more accessible for corporate entities.
References & Reading Articles
- Press Information Bureau – Year End Review-2024 : Ministry of Corporate Affairs
- Business Standard – Year in review: 5 important regulatory changes by Indian govt in 2024
- The Economic Times (Legal World) – A year of farewells, separation, failed union, M&As for corporate India
Want to stay informed and inspired? Subscribe to our blog for insightful updates delivered straight to your inbox. Explore our website for a curated collection of reference books, resources, and more – designed to fuel your curiosity and keep you ahead.
Download the full article, to read it offline:
One thought on “2024 Key Changes in India’s Corporate Affairs”