The Major Corporate Law amendments of the year 2015 with brief highlights.

1. Corporate Law Amendments 2015
The Year 2015 has seen many major changes in the Legal and Corporate India with
many changes in the various Laws or new statues being enacted so I am presenting the
major Corporate Laws Changes taken place in 2015.
Corporate Law Highlights- 2015:
Companies (Amendment) Act, 2015
The Companies Amendment Act, 2015 has amended the various provisions of
Companies Act, 2013 thereby providing major relief to Corporate India.
The Major highlights of the Amendment Act, 2015 are:-
 Minimum Paid up Capital
 The amended Act make it optional for companies to be incorporated after the
amendment coming into force without the requirement of minimum paid up
capital to incorporate the Company.
 Commencement of Business
Section 11- Certificate of Commencement of Business is omitted, thus a private
Company as well as Public company can directly can commence their business or
borrowing without any Certificate of Commencement of Business.
 Common Seal
Companies Amendment Act have made it optional for companies to have a common
seal, thus a share certificate or other document which requires common seal are still
valid if they do not have a common seal on them.
 Related Party Transactions

2. Section 188 – Related Party Transactions which requires passing of Special
Resolutions and also non participation of the interested person in the voting now can
be passed as Ordinary Resolutions.
 Board Resolutions
Section 399 has been amended whereby Board Resolutions (section 179- Powers of
the Board) are no longer accessible under Public Documents view of MCA, thus
Board Resolutions cannot be viewed by public at large.
The Amendment Act inserted following proviso to section 117(3)(g):
“Provided that no person shall be entitled under section 399 to inspect or obtain
copies of such resolutions; and
 No Dividend Declaration
The Amendment Act, 2015 provides that:
“Provided also that no company shall declare dividend unless carried over previous
losses and depreciation not provided in previous year or years are set off against profit
of the company for the current year.”
Thus a company cannot declare dividends if it’s losses are not set off.
 Loans and Guarantee by holding to wholly owned subsidiary company
Section 185 of the Act provides for Loans to directors whereby the loans and
guarantee provided by a holding company to its wholly owned subsidiary company,
thus no restriction on Loans and guarantee by a holding company to its wholly owned
subsidiary except for the fact that the loans should be used for Principal business
activities.

3. 2. Negotiable Instruments (Amendment) Act, 2015:
The Government went the ordinance route for the Negotiable Instruments Act but now
the same is replaced and the NI 1881 and the Ordinance, 2015 is amended by
Negotiable Instruments (Amendment) Act, 2015. The Brief highlights of the amended
act are as follows:-
The definition of “cheque” is amended which now includes the “electronic form”.
Thus it is defined to mean a cheque drawn in an electronic form by a computer source
and signed through digital signature or by electronic signature.
The most important change came in the form of place of filling of case or
jurisdiction in case of cheque dishonor cases, which are as follows:
If the cheque is delivered for collection to the account of the payee (person who
receives the cheque), the jurisdiction lies in the area of the bank branch where
the payee maintains an account, or
If the payee presents a cheque to a bank in any other way, the jurisdiction lies in
the area of the bank branch where the drawer (person who writes the cheque)
maintains an account.
For Example:-
Mr. A maintains a Bank account with SBI bank, Hyderabad Branch (Payee), Mr. A
received the cheque from Mr. B for the services rendered to him and he issues cheque
to Mr. A, if the cheque got dishonoured after the same presented in SBI, Hyderabad
(Payee Place) then:
The place of filling of criminal complaint lies in Hyderabad (Payee Place) or in other
situation the place of Drawer.
This is the major relief for various Financial Institution or traders or Business
community at large.

4. 3. Arbitration and conciliation Act, 1996
Well I would like to call this as the major legal amendment of the year 2015 and a
much needed for Arbitration in India. I won’t go into detail about the changes but will
provide a brief outline only.
The major highlights of this amended Act are as follows:
 Appointment of arbitrator is done by Supreme Court for International arbitration
cases and High Court in other cases. The application for the appointment of
arbitrator should be disposed within 60 days.
 Disclosures of interest by Arbitrator for the purpose of declaring independence or
ineligibility to act. The Schedule V of the act contains the list of items regarding
independence or ineligibility.
 The hearing will take place on day to day basis for evidence or oral arguments and
not grant adjournment without sufficient cause. The award to be made within a
period of 1 (one) year from the date of reference, beyond that a period of 6 (six) is
allowed after that the arbitrator expires.
 A provision for fast track arbitration is also there whereby parties can opt for fast
track procedure where the tribunal can decide on the basis of written pleadings,
documents and submission filed by the parties without any oral hearing and it
should be made within a period of 6 (six) months from the date of reference.
 The fees of Arbitration is provided by Schedule IV wherein a model fee is
prescribed and ask for High Court to frame rules in this regards. The same is not
applicable to international arbitration.
 An amount awarded by the arbitral tribunal will, unless otherwise specified by the
arbitral tribunal, carry interest at 2% p.a. more than the current rate of interest,
from the date of the award to the date of payment.
 Challenge & Execution of Awards
 With regard to appeal of awards made wherein a prior notice to the other party
that the award is going to be challenged has been made mandatory and the party
challenging the award has to file an affidavit endorsing compliance of the above
requirement and also that the automatic stay of execution during the pendency of

5. Section 34 is taken away and after the period of time for challenging the award
has expired, the award becomes immediately executable, unless the court grants
an order of stay of the operation of the arbitral award.
 4. Other major amendments in 2015 are:-
INSURANCE (AMENDMENT) ACT
The insurance amendment Act is a major reforms for the Indian insurance sector,
the Act has amendment the Insurance Act, 1938, the General Insurance Business
(Nationalization) Act, 1972 and the Insurance Regulatory and Development
Authority (IRDA) Act, 1999 and also the Insurance Laws (Amendment)
Ordinance, 2014.
The Insurance Act was amended to provide for Foreign Direct Investment upto
49% in the insurance sector and covers all intermediaries.
The Major highlights are:
Consumer Protection
The amended Act provides for better protection of consumers from intermediaries,
Insurance Companies for any misconduct or mis-selling and disallowing
multilevel marketing of insurance products thereby preventing any mis-selling of
the products to the consumers.
There will be penalty for various violations especially any mis-selling and
misrepresentation by agents / insurance companies, the penalties ranges up to Rs.1
Crore to Rs. 25 Crore.
More Powers to IRDAI
The amendment Act provides for more powers to IRDAI to discharge their
functions more effectively with regard to eligibility, qualifications and other
aspects for the insurance agents or intermediaries, it also provides the Authority to
regulate the functions, code of conduct, etc., of surveyors and loss assessors. It
also expands the scope of insurance intermediaries to include insurance brokers,

6. re- insurance brokers, insurance consultants, corporate agents, third party
administrators, surveyors and loss assessors.
Appeal to SAT
Appeals against the order of IRDAI can be filed to SAT by any insurer or
intermediary.
Reinsurance Business
The amended Act enables foreign reinsurers to set up branches in India and the
same shall be within the cap of 49% for foreign investment in Indian Insurance
Companies.
In my view the amended Act is a major reform of 2015 which gives big boost to
Indian companies like ICICI Prudential, HDFC Life or Birla Sun Life to raise
further capital and also very good step towards Foreign Direct Investment (FDI) in
the Insurance Sector.
Black Money Act, 2015
To deal with the menace of black money in India the Government of India enacted
the Act to curb the flow of Black Money and also improving the economy. This
will provides for stringent penalty or jail term for those found guilty.
I hope you find this article a joy to read, if somebody have opinions or want to
express the views then please do comment, if you want to discuss more on the
abovementioned acts especially the Companies amendment Act or the amended
Negotiable Instruments Act then you can reach me at below contact:
Mobile:- 7097406982
Jai Singh

7. THANK YOU