Appointment of company secretary and Secretarial Audit report- New rules 2020

Appointment of company secretary and Secretarial Audit report- New rules 2020

Appointment of company secretary must for Private companies with paid up share capital of ten crore or more, Secretarial audit must for company having outstanding loans or borrowings from banks/PFIs of 100 crore or more.

 

appointment of company secretary

 

ln exercise of the powers conferred by sub-section (1) of section 203 of the companies Act, 2Ol3 (18 of 2013) read with section 469 of the said Act, the central Government hereby makes the following rules further to amend the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, namely

What this rules will be called?

These rules may be called the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2020.

When the following rules will become applicable?

They shall be applicable in respect of financial years commencing on or after 1st April, 2020.

Old Rule 8A and Rule 9

Rule 8A as per Companies Appointment and Managerial Remuneration Rules 2014

A company other than a company covered under Rule 8 which has a paid up share capital of Rs.5 Crores or more shall have a whole–time Company Secretary

Rule 9 as per Companies Appointment and Managerial Remuneration Rules 2014

(1) For the purposes of sub-section (1) of section 204, the other class of companies shall be as under- (a) every public company having a paid-up share capital of Rs.50 Crores or more; or

(b) Every public company having a turnover of Rs.250 Crores  rupees or more.

Amendment in Rule 8A and Rule 9

ln the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (herein after referred to as said rules), for rule 8A, the following shall be substituted as under.

Now onward from 1st April 2020, every private company which has a paid up share capital of ten crore rupees or more shall have a whole -time company secretary.”

In the said rules, in rule 9 of the said rules, in sub-rule (1), (i) after clause (b), at the end the word “or” shall be inserted. (ii) After clause (b), the following clause shall be inserted, namely:

(c) Every company having outstanding loans or borrowings from banks or public financial institutions of one hundred crore rupees or more.”

(iii) the following explanation shall be inserted, namely:

“Explanation :- For the purposes of this sub-rule, it is hereby clarified that the paid up share capital, turnover, or outstanding loans or borrowings as the case may be, existing on the last date of latest audited financial statement shall be taken into account.”.

Please click here for official notification. Notification dated 03-01-2020

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