drastically from between 5 to 15 working days in June 2014, to an average of 0.6 working days
in March 2017. Similarly, the processing time for name availability applications has been
brought down significantly from between 5 to 6 working days in June, 2014, to an average of 0.4
days in March 2017. In addition, more than 90 per cent applications are being approved within
one working day. This has resulted in speed, greater transparency, uniformity and eradication of
discretion.
Ease of Doing Business
The Ministry has prescribed a Simplified Proforma for Incorporating Companies (SPICe)
along with e-MOA (Electronic-Memorandum of Association) and e-AoA (Electronic-Articles of
Association) which eliminates the requirement of physically signing the Memorandum of
Association (MoA) and Articles of Association (AoA) by the applicant and helps entrepreneurs
to start business in India, without much hassles. The fee for filing the incorporation form has
been reduced from ₹ 2,000/- to ₹ 500. The integrated form INC-29 has been replaced with SPICe
Form. This incorporation form is being processed within 1-2 working days. Electronic
integration of MCA21 System with the Central Board of Direct Taxes (CBDT) for issue of PAN
and first TAN to an incorporated company using the Simplified Proforma for Incorporating
Company Electronically (SPICe) has been undertaken. Stakeholders now submit applications for
PAN and TAN at the time of submitting applications for incorporation. The PAN allotted by
Income Tax Department is being affixed on the Certificate of Incorporation of the Company
from February, 2017. This has resulted in reduction in the number of processes and time taken
for starting a business in the country.
SPICe is a more versatile form and leverages on digital technology by eliminating the need
for hard copies of physically signed documents being attached to an e-form. Using the integrated
e-form SPICe, stakeholders can apply for five services simultaneously viz., company name,
company incorporation, DIN of the directors, Permanent Account Number (PAN) and Tax
Deduction and Collection Account Number (TAN) for the newly incorporated company. Rule 15
of the Companies Rules, 2014 (Meetings of the Board and its Powers) was amended in 2017 to
reduce the threshold to “10 per cent” of the networth/ turnover as the case may be against the
earlier threshold of exceeding 10 per cent thereby needing approval of members instead of only
board. Common seal under Companies Act, 2013 has been made optional. The requirement for
obtaining certificate of commencement of business and requirement for minimum paid up share
capital for all companies have been done away with under Companies Act, 2013.
The efforts of the government have paid dividends. According to the Doing Business Report
(DBR) of the World Bank, India has jumped 23 positions against its rank of 100 in 2017 to 77
among 190 countries.
The Companies Act, 2013 seeks to bring corporate governance and regulatory practices in
India at par with global best practices. The corporate sector has been given more flexibility in
regulating its own affairs, subject to full disclosure and accountability of its actions, while
minimising Government interference. The Act provides more opportunities for new
entrepreneurs and enables wide application of information technology in the conduct of affairs
by corporates. Key features of the Act are given here.
Key Features of the Companies Act, 2013
I. Business Friendly Corporate Regulations/Pro-Business Initiatives