Government launches Company Law Settlement Scheme, 2014

The penalties under the Companies Act, 2013 (“Act”) for not filing annual returns and financial  statements with the Registrar of Companies have been made stricter. To avoid the attraction of  higher fees/ fine and other penal action, the Central Government has brought in force the Company  Law Settlement Scheme, 2014, which provides an opportunity for companies to file pending annual  statements with the Registrar of Companies, thereby condoning the delay in filing the said  documents and granting immunity from prosecution under the Act. Further, under the scheme, inactive  companies can be declared as ‘dormant company’ by filing an application. Companies may note that  the scheme is effective from August 15, 2014 and in force till October 15, 2014.

Government permits foreign direct investment (FDI) in the railways and defense sector

The Ministry of Commerce and Industry, vide Press Note 8 of 2014, has permitted 100% FDI under the  Automatic route in the railway transport sector. FDI beyond 49% in sensitive areas will be  considered by the Cabinet Committee on Security on a case to case basis. FDI is allowed in infrastructure building of the railways  (including inter alia, construction, operation and maintenance of suburban corridor projects based  on Public Private Partnership, High Speed Train projects, Dedicated Freight lines, electrification  and signaling systems, freight and passenger terminals, mass rapid transport systems etc.) and not  in operations.

Vide Press Note 7 of 2014, the Ministry of Commerce and Industry has permitted 49% under the  Government route in defense, subject to obtaining industrial license under  the Industries  (Development and Regulation) Act, 1951. FDI beyond 49% will be considered by the Cabinet Committee  on Security on case to case basis, where it is likely to result in access to modern and ‘state of  the art’ technology.

Employee Provident Fund Scheme amended

The Ministry of Labour & Employment has amended the Employee Provident Fund Scheme under which the statutory wage ceiling has been enhanced from the existing ceiling of Rs. 6,500 to Rs. 15,000.  Further, the minimum pension under the scheme has been fixed at Rs. 1,000 per month and additional relief of 20% is provided on the amount of assurance benefit admissible  under Employees Deposit-Linked Insurance Scheme, 1976. The amended provisions are in effect from 1 September 2014.