• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

Richa Mishra

NEW DELHI, April 19

IN a bid to ensure proper compliance of the Companies Act provisions, the Department of Company Affairs (DCA) is contemplating further relaxation in the norms for appointment of company secretaries.

The department is looking into a proposal to amend the rules of Section 383A of the Act which states that every company having a paid-up share capital of Rs 50 lakh and above shall have a whole-time company secretary. The limit is proposed to be raised to Rs 1 crore or more.

"This move is based on the representations from the trade and industry that the limit prescribed in the Companies Act for the companies which can appoint company secretaries should be raised and plug certain loop-holes,'' according to sources.

DCA has been receiving complaints that the companies, which fall under the Rs 50 lakh paid-up share capital, have not been complying with the law. "The bigger corporate houses anyway have company secretaries, it is those companies which fall under the said category which have been making excuses for non-compliance,'' sources explained.

This will also create work for practising secretaries, sources said. Meanwhile, the Institute of Company Secretaries of India (ICSI) has also suggested to the Department to raise the limit to a minimum of Rs 1 crore.

While the corporates have been alleging shortage of company secretaries, the ICSI brushes aside such charges.

The Institute has also pointed out that "to avoid appointing company secretaries many companies advertise in local newspapers offering meagre remunerations and, therefore, attracting no response,'' sources said.

Send this article to Friends by E-Mail

Stories in this Section
Hindustan Lever puts off AGM to June 26

Copyright © 2002, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line