COMPANIES (AMENDMENT) BILL,2026: KEY HIGHLIGHTS YOU SHOULD KNOW

The Corporate  Law (Amendment) Bill, 2026, introduced in the Lok sabha on 23^rd March 2026, to amend Companies Act, 2013 and Limited Liability Partnership Act, 2008. The Core Objective is to ease the business, strengthening corporate governance, rationalize compliance requirement and to decriminalize the minor offences.

In continuation of the Government’s constant endeavour to facilitate greater ease of doing business for corporates , the Company Law Committee (CLC) consitituted by the Governement submitted its last report in March 2022. On the basis of said report, consultations made with various stakeholders and the recommendations of the High Level Committee on Non- Financial Regulatory Reforms, it is proposed to amend the Companies Act. The proposed amendments are broadly aimed at –

1. Promoting further easy of doing  and ease of living for corporates by decriminalizing more provisions  and amending certain provisions;
2. Providing ease of compliance for OPC, Small company, Startup Companies and producer companies;
3. Streamlining existing regulatory practices to strengthen and improve the operational efficiency of the said enactments;
4. Recognizing new concepts in light of rapidly evolving corporate landscape  and changing business practices; and
5. Carrying out drafting and clarificatory changes to remove ambiguities.
6. Simplication of Procedures relating to mergers and amalgamation;
7. Providing exemption to small company relating to CSR, appointment of auditor, reduction in additional fees etc
8. Simplication of procedure of voluntary strike off;
9. Relaxation in CSR requirement relating to threshold limit;
10. Flexibility in buy-back of shares.

Major Amendment in Companies (Amendment) Bill, 2026:

• Small Company (2(85): Paid up Capital increased to 20 Crore rupees and  turnover limit increased to 200 crore rupees.
• Incorporation: Declaration by Advocate/CA/CS/CMA shall be applicable only when company engages such professionals in its formation or incorporation.
• Buy-Back (68): Company now can undertake two buybacks in a year and minimum gap between two buy-back will be 6 months.
• Charges (77): Timelines for registration of companies increased from 120 days to 180 days.
• AGM/EGM (96 & 100): Company can now conduct AGM in physical mode atleast once in every three years and allowed company to conduct meeting in audio visual and video conferencing means.
• CSR (135): Applicability threshold limit increased from 5 Crore to 10 Crore, transfer of unspent amount replaced from 30 days to 60 days and  CSR committe threshold limit increased from 50 lakh to 1 crore rupees.
• Auditor Exemption (139): Certain companies are exempted from appointing auditors.
• DIN (152): Director shall not act or function if the DIN is expired or cancelled.
• Additional Director (161): Additional Director shall hold office upto the next AGM or 3months whichever is higher. Additional Director cannot be appointed in board meeting without approval of members.
• Board Meeting (173): OPC, Small company and dormant company shall conduct atleast 1 meeting in a calender year.
• MBP-1 (184): MBP-1 is only required when there is change in the disclosure.
• If a prospectus is issued in contravention then every person who is knowingly a party to the issue shall be liable to penalty of 2 lakh rupees. The offence is decriminalized.
• 7 days of notice for EGM.
• Now appointing auditor is not compulsory for small companies to ease compliance for small companies.
• If shares are transferred to IEPF then unclaim/unpaid dividend will also transfer to IEPF.
• The period of non-filing Financial Statements or annual return is replaced from 3 financial year to 2 financial year so that companies are more diligent in filing such documents on time.
• Now director need to vacant the office after disqualification within 6 months from disqualification or after expiry of tenure, whichever is earlier.
• Now section 185 also covers LLP.
• Previously, LLP works according to Indian laws but after amendment IFSC LLP introduced and IFSC LLP allow to work globally.
• If there is any change in partner, then the LLP is required it t report it annually.
• Each partner who contribute in IFSC LLP shall be disclosed in foreign currency.
• Now specified IFSC LLP allowed to maintain books of accounts in permitted foreign currency and also allowed to prepare in Indian rupees.
• Now conversion of specified Trust are allowed into LLP.

FAQ on Companies (Amendment) Bill, 2026?

• What is the objective of bringing Companies (Amendment) Bill, 2026?

To ease the business, strengthening corporate governance, rationalize compliance requirement and to decriminalize the minor offences.

• When will Companies (Amendment) Bill, 2026 be applicable?

The bill has amended 107 section and it will be applicable on different dates as notify by the government.

• Are the Offences decrimanlize?

Yes Decriminalization of various procedural defaults by replacing criminal provisions with civil penalties.

• How will the amendment bill, 2026 benefit the small companies and startup?

It will benefit the small company and startup as it reduced the penalties, less compliances, faster approval for merger.

• What are the changes in CSR provisions?

CSR threshold limit of net profit increased from 5 crore to 10 crore and transfer of unspent duration replacedfrom 30 days to 60 days. Non- compliance of provisions will lead to penalties.

• Does the Companies (Amendment) bill, 2026 helped to reduce the Compliance Burden?

Yes the compliance have been simplied for small company, dormant company and for OPC.

• Is the bill focused on digital reforms?

Yes, the bill focused on digital reforms by introducing e-filings ,conduct of meeting digitally and record maintenance digitally.

• What are amendment In Din applicability?

Now onwards the DIN will be deactivate or cancelled if not functioned properly.

• Will Disclosure of Interest is not compulsory every year?

No it’s not compulsory to disclose every year only need to disclose when there is any change.

How we can help you?

• In understanding and complying with the companies (Amendment) Bill, 2026 in simplest way.
• Understand by giving expert advice on how will this impact your business, Corporate governance and director related provisions.
• To reduce the risk of penalties.
• By giving practical knowledge.
• Roc filings and proper documentation.
• We as a expert team in Compliance will always work in the welfare of the Clients and to reduce their burden.

Additionally, the Companies (Amendment) Bill, 2026 makes the compliance simpler, easiest, faster and practical for businesses.