MCA Updates: MCA changes the limit for CS appointment and Secretarial Audit

MCA Updates: MCA has amended rules for by changing the limit of paid up capital for appointment of Company Secretary and changing the criteria for conducting Secretarial Audit

Ministry of Corporate Affairs (MCA) has issued a notification amending Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 for following things.

1. Amendment in Rule 8A - the limit for paid-up capital has been increased from Rs 5 Cr to Rs 10 Cr for appointment of whole-time Company Secretary

2. Amendment in Rule 9 - the criteria for Secretarial Audit has been changed by addition of following criteria

"(c) every company having outstanding loans or borrowings from banks or public financial institutions of one hundred crore rupees or more."

The amended rules have further specified the Explanation for the Rule 9 which states as under.

Explanation :- For the purposes of this sub-rule, it is hereby clarified that the paid up share capital, turnover, or outstanding loans or borrowings as the case may be, existing on the last date of latest audited financial statement shall be taken into account.".

01st April, 2020 shall be the effective date of this notification.

The copy of notification can be accessed below: