Companies Act

Independent Directors database-delay may be allowed after charging fees of Rs. 1000/-

Independent Directors database-delay in inclusion of name may be allowed after charging late fees of Rs. 1000/-

The Ministry of Corporate Affairs (MCA) vide notification No. GSR 418(E) dated 18th June 2021 notified the Companies (Creation and Maintenance of databank of Independent Directors) Amendment Rules, 2021 to further amend the Companies (Creation and Maintenance of databank of Independent Directors) Rules, 2019.

These Rules are applicable to existing Independent directors and individual who are willing to be appointed as independent director and also to the Companies which are required to appoint Independent directors under the Companies Act 2013.

As per the amendment made, in case an individual delays his/her application to IICA for inclusion of name or for renewal, such inclusion or renewal may be allowed by IICA “after charging a further fees of one thousand rupees.

ICAI in its announcement has made a comparative analysis of the pre and post amendments rules as under:

Rule 3(7)(a) of Companies (Creation and Maintenance of databank of Independent Directors) Rules, 2019

Pre-amendment Post Amendment
(7) The institute shall, with the prior approval of the Central Government, fix a reasonable fee to be charged from:-

(a) individuals for inclusion of their names in the data bank of independent directors; and
(7) The institute shall, with the prior approval of the Central Government, fix a reasonable fee to be charged from:-

(a) individuals for inclusion or renewal of their names in the data bank of independent directors; and

Rule 3(8) of Companies (Creation and Maintenance of databank of Independent Directors) Rules, 2019

Pre-amendment Post Amendment
N.A. NEW INSERTION
In case of delay on the part of an individual in applying to the institute under sub-rule (7) for inclusion of his name in the data bank or in case of delay in filing an application for renewal thereof, the institute shall allow such inclusion or renewal, as the case may be, under rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014 after charging a further fees of one thousand rupees on account of such delay

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