Panel reviewing penal provisions under Cos Act likely to submit report this week

NEW DELHI, Aug 26:
A Government-appointed panel tasked with reviewing the penal provisions under the Companies Act is likely to submit its report to Corporate Affairs Minster Arun Jaitley this week, a senior official said.
Headed by Corporate Affairs Secretary Injeti Srinivas, the ten-member committee also had the mandate to examine de-criminalisation of certain offences as part of larger efforts to ensure that courts get more time to deal with offences of serious nature under the Act.
Noted banker Uday Kotak, former Lok Sabha Secretary General T K Vishwanathan, law firms Shardul Amarchand Mangaldas’ Executive Chairman Shardul S Shroff and AZB & Partners’ Founder Managing Partner Ajay Bahl are among the members.
A senior Corporate Affairs Ministry official said the panel is expected to submit its report to the minister this week and it is likely on August 27.
Announcing the setting up of the panel last month, the ministry said it “seeks to review offences under the Companies Act, 2013 as some of the offences may be required to be decriminalised and handled in an in-house mechanism, where a penalty could be levied in instances of default”.
This would also allow the trial courts to pay more attention to offences of serious nature, the ministry had said in a release.
The panel is expected to suggest ways that would allow trial courts to pay more attention on offences of serious nature under the Act.
In his monthly newsletter, Srinivas said the committee is to examine the nature of all acts categorised as compoundable offences. These are offences punishable with fine only or punishable with fine or imprisonment or both under the Act. According to him, the committee would recommend if any of such acts may be re-categorised as those which attract civil liabilities wherein the company and its officers in default are liable for penalty.
“The panel would seek to put in place the broad contours of an in-house adjudicatory mechanism where penalty may be levied in a MCA21 system driven manner so that discretion is minimised,” Srinivas said in the newsletter for the month of July.
MCA21 is the portal for stakeholders to submit statutory filings under the Companies Act. (PTI)