Although press reports indicated last week that
the Companies Act, 2013 had received the assent of the President, the official
confirmation is now available. The Gazette
notification, which also carries the legislation as enacted, indicates that
the Presidential assent was received on August 29, 2013.
the Companies Act, 2013 had received the assent of the President, the official
confirmation is now available. The Gazette
notification, which also carries the legislation as enacted, indicates that
the Presidential assent was received on August 29, 2013.
Currently, while the law has been enacted
in its entirety, it is yet capable of implementation as the substantive
sections of the Act are still to be notified. Only section 1 of the Act has
come into effect, and section 1(3) provides:
in its entirety, it is yet capable of implementation as the substantive
sections of the Act are still to be notified. Only section 1 of the Act has
come into effect, and section 1(3) provides:
This section
shall come into force at one and the remaining provisions of this Act 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 the Act shall be construed as a reference to the coming into force of that
provision.
shall come into force at one and the remaining provisions of this Act 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 the Act shall be construed as a reference to the coming into force of that
provision.
The Companies Act
provides the broad framework and a substantial part of the details of the
corporate law regime will be governed by various sets of rules to be
promulgated by the Central Government. The implementation of the Act will be
subject to finalization of the rules, and hence various substantive provisions
will become effective once the respective rules are promulgated. Hence, it is
likely that there could be a phased implementation of the Act, somewhat similar
to the process followed in the case of the UK Companies Act of 2006. In that
case, a timetable for implementation was set out upfront, but in India’s case
there is an element of uncertainty as no implementation schedule has been
announced yet.