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Companies Bill likely to be tabled in next session
March, 28th 2011

Parliament is likely to take up the new Companies Bill, which seeks to replace a half-a-century-old Act, in the next session.

Sources in the Ministry of Corporate Affairs said that the Companies Bill, 2009, will be brought for passage before Parliament in the next session.

The draft Bill will be sent to Cabinet in the first week of May, sources said.

The new Companies Bill, which was tabled in the backdrop of the Rs 14,000 crore Satyam fraud, promises greater shareholder democracy and stricter corporate governance norms.

The Bill proposes to introduce the concept of class action suits for the first time in India, which would empower investors to sue a company for 'oppression and mismanagement' and claim damages.

Among other things, it also proposes to tighten the laws for raising money from the public.

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

The Bill could not be taken up for consideration and passage in the Budget Session of Parliament, which was cut short on account of the forthcoming Assembly elections in four states and one Uniont Territory.

 
 
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