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Draft Notification MCA: Applicability of Section 43, 47, 62(1) (2), 73, 101 to 107, 109, 141(3), 160, 162, 196(4) (5),180, 185, 188, 203(3) to Private Limited Companies

MCA has issued the draft notification for public comments: Points covered under the notification are related to the applicability of the different provisions to the Private Limited Companies. Applicability of Section  43, 47, 62(1) (2), 73, 101 to 107, 109, 141(3), 160, 162, 196(4) (5),180, 185, 188, 203(3) to Private Limited Companies

[DRAFT NOTIFICATION]
(FOR PUBLIC COMMENTS TILL 1ST JULY, 2014)

Placed on website of MCA; 24/06/2014

[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

GOVERNMENT OF INDIA

MINISTRY OF CORPORATE AFFAIRS
NOTIFICATION
New Delhi, the 2014

G.S.R. ___ (E). – In exercise of the powers conferred by clauses (a) and (b) of subsection (1) of section 462 of the Companies Act, 2013 (18 of 2013), the Central Government hereby, in public interest, directs that the provisions of sections 43, 47, Clause (a) and (b) of sub-section (1) and sub-section (2) of section 62, 73, 101 to 107, 109, clause (g) of sub-section (3) of section 141, 160, 162, sub-sections (4) and (5) of section 196, section 180, section185, section 188, sub-section (3) of section 203 of the Companies Act, 2013 shall apply to a private Company with the modifications set out below, a copy of this notification having been laid in draft before both Houses of Parliament as required by sub-section (2) of section 462 of the said Act, namely:-

SN Chapter/ Section number/ Sub-section(s) in the Companies Act, 2013 Exceptions/ Modifications/Adaptations Section Not Applicable
1 Chapter IV, section 43 and section 47 [Both whole] Shall not apply Section 43- Kinds of share capital And Section 47- Voting rights
2 Chapter IV, clause (a) of sub-section (1) of section 62) and sub-section (2) of section 62 Shall apply with the following modification:-
Words ‘not being less than fifteen days and not exceeding thirty days’ shall be substituted with ‘not being less than seven days and not exceeding fifteen days’
Section 62- Further issue of share capital (except sub-sections
(4) to (6))
3 Chapter IV, clause (b) of sub-section (1) of section 62 Shall apply except that instead of special resolution, ordinary resolution would be required Section 62- Further issue of share capital (except sub-sections
(4) to (6))
4 Chapter V, sub-section (2) of section 73 Shall not apply to private companies having 50 or less number of members if they accept monies from their members not exceeding twenty five per cent of aggregate of the paid up capital and free reserves or one hundred per cent of the paid up capital, whichever is more, and which inform the details of such monies to the Registrar in the prescribed manner Section 73- Prohibition on acceptance of deposits from public.
5 Chapter VII, sections 101 to 107 and section 109 [All whole] Shall apply unless
– otherwise specified in respective sections or
– unless articles of the private company otherwise provide.
Section 101- Notice of meeting and Section 109- Demand for poll.
6 Chapter X, Clause (g) of sub-section (3) of section 141 Shall not apply in respect of appointment of auditors by private companies. Section 141- Eligibility, qualifications and disqualifications of auditors.
7 Chapter XI, section 160( Whole) Shall not apply Section 160- Right of persons other than retiring directors to
stand for directorship.
8 Chapter XI, section 162 [Whole] Shall not apply Appointment of directors
to be voted individually.
9 Chapter XII, Section 180 Shall not apply to private companies having 50 or less number of members Restrictions on powers of
Board.
10 Chapter XII, section 185 Shall not apply to Private companies – (a) which have borrowings from banks or financial institutions or any bodies corporate not more than twice of their paid up share capital or Rs. 50 crore, whichever is lower; and (b) in whose share capital no other body corporate has invested any money”. Loan to directors, etc.
11 Chapter XII, section 188 Shall not apply. Section 188- Related party transactions.
12 Chapter XIII, section 196, sub-section (4) and sub-section (5) Shall not apply. Section 196- Appointment of managing director, whole-time
director or manager.
13 Chapter XIII, sub-section (3), section 203 Shall not apply. Section 203- Appointment of key managerial personnel.

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