Union finance minister Nirmala Sitharaman on May 17 announced that the government will decriminalise most of the violations of the Companies Act which was approved by the Cabinet in the first week of March. The Company Law Committee headed by Ministry of Corporate Affairs Secretary Injeti Srinivasan recommended 46 offences to compoundable category. CLC recommended dealing of compoundable offence by in-house adjudication mechanism which is at the rank of Registrar of Companies level officer. Section 447 of the Companies Act says, “Without prejudice to any liability including repayment of any debt under this Act or any other law for the time being in force, any person who is found to be guilty of fraud shall be punishable with imprisonment for a term which shall not be less than six months but which may extend to ten years and shall also be liable to fine which shall not be less than the amount involved in the fraud, but which may extend to three times the amount involved in the fraud.” Easing of non-compliance burden will facilitate corporate India to focus on business revival without worrying about the regulatory compliance burden, said Rajesh Thakkar, Partner & Leader, Transaction Tax, BDO India.

(Moneycontrol)