Published 15 October 2026
The Corporate Laws (Amendment) Bill, 2026, introduced in the Lok Sabha on 23 March 2026, is a wide-ranging set of proposed changes to the Companies Act, 2013 and the LLP Act, 2008. It was referred to a Joint Parliamentary Committee, chaired by Sudhir Gupta, which presented its report on 3 August 2026. The Bill has not been passed, so none of this is law yet. For founders and directors in Kerala, here is what the Bill proposes, where the Committee wants changes, and what would matter most to a private company.
What the Bill proposes
- Small companies: raise the outer limits within which the government can define a small company from ₹10 crore to ₹20 crore of paid-up capital and from ₹100 crore to ₹200 crore of turnover. The actual limits would still be set by rules.
- CSR: raise the net profit trigger for the CSR obligation from ₹5 crore to ₹10 crore, or another prescribed sum, and allow classes of companies meeting prescribed conditions to be exempted.
- Decriminalisation: replace imprisonment or fine with civil penalties for offences such as violating the requirements on books of account, failing to furnish information or documents required by the Registrar, failing to comply with a Registrar's requisition other than a summons, and contravening the rules.
- Meetings and paperwork: allow the AGM to be held physically or by video conferencing, with a physical meeting at least once every three years; allow electronic service of documents; replace certain affidavits with self-declarations.
- Auditors: exempt companies meeting prescribed conditions from appointing an auditor.
- Fast-track mergers of small companies and of holding and wholly owned subsidiary companies: approval by a majority of members present and voting holding at least 75 per cent of the shares voted, instead of 90 per cent of total shares, and creditor approval at 75 per cent instead of 90.
- Others: buy-backs above 25 per cent for prescribed classes, the Insolvency and Bankruptcy Board as Valuation Authority, wider powers for the National Financial Reporting Authority, recognition of RSUs and stock appreciation rights, and conversion of specified SEBI- or IFSCA-registered trusts into LLPs.
What the Joint Committee recommended
- CSR: drop the power to revise the ₹10 crore threshold by rules; note that the power to exempt classes of companies lacks statutory guidance and amounts to excessive delegation; let the government notify a negative list of entities, such as those disqualified by law or by a court or regulator, to which contributions would not count as CSR; and examine permitting CSR contributions in kind.
- Auditor exemption: limit it to private companies.
- Directors: delete the proposed disqualification of a person not assessed as "fit and proper" by the board, as an excessively broad delegated power.
- Managerial age limits: reduce the minimum age for a managing director, whole-time director or manager from 21 to 18, and raise the maximum from 70 to 75.
- Mergers: add a statutory exit right for dissenting or non-voting shareholders under the new 75 per cent route.
- NFRA: keep the manner of investigation in central government rules rather than NFRA regulations, and remove imprisonment, retaining a fine, for failing to comply with NFRA orders or pay its penalties.
- NCLT: mandate dedicated benches for insolvency matters so that Insolvency and Bankruptcy Code timelines are protected.
What would matter most to a private company in Kerala
For a typical private limited company the useful changes are practical: a video-conference AGM with only one physical meeting in three years, self-declarations in place of affidavits, civil penalties instead of prosecution for book-keeping and Registrar lapses, and possibly an exemption from appointing an auditor for prescribed classes. The small-company change matters only once the rules move: today a small company is one with paid-up capital up to ₹10 crore and turnover up to ₹100 crore, already the maximum the present Act allows, and the Bill would let the government go higher. Young founders would gain from the Committee's proposal to let an 18-year-old be a managing or whole-time director.
What happens next
The Bill returns to Parliament with the Committee's report, and the government may move amendments accepting some or all recommendations before it is passed. Most of the detail, such as the conditions for auditor exemption and the classes of companies for electronic service, would come in rules after enactment. Until then, file AGMs, annual returns and financial statements under the present law and timelines.
Frequently Asked Questions
Has the Corporate Laws (Amendment) Bill 2026 been passed?
No. It was introduced in the Lok Sabha on 23 March 2026 and examined by a Joint Parliamentary Committee, which presented its report on 3 August 2026. It must still be passed by both Houses.
Will the CSR threshold rise to ₹10 crore net profit?
The Bill proposes raising the net profit trigger from ₹5 crore to ₹10 crore; the Committee recommended removing the government's power to revise that threshold by rules. The present ₹5 crore trigger applies until the law changes.
What does the Bill change for small companies?
It raises the outer limits for defining a small company to ₹20 crore paid-up capital and ₹200 crore turnover. The actual thresholds would still be prescribed by rules, which today stand at ₹10 crore and ₹100 crore.
Can AGMs be held online under the Bill?
Yes. A company could hold its AGM physically or by video conferencing or other audio-visual means, but would have to hold a physical meeting at least once in every three years.
What age limits did the Committee recommend for managing directors?
It recommended a minimum age of 18 instead of 21 and a maximum of 75 instead of 70 for managing directors, whole-time directors and managers.
Sources
PRS Legislative Research, Bill Summary: The Corporate Laws (Amendment) Bill, 2026, 27 March 2026; PRS Legislative Research, Joint Parliamentary Committee Report Summary on the Corporate Laws (Amendment) Bill, 2026, 31 August 2026; Companies Act, 2013, sections 2(85), 135 and 233; Limited Liability Partnership Act, 2008.
BookMyTM incorporates companies and LLPs and handles their annual ROC compliance across Kerala, and will update clients when the Bill is passed and its rules are notified.