Soon Independent Company Directors may have to Clear Exams to Sit on Boards of Dir

With massive numbers of scams and scandals, Narendra Modi-led government is preparing to start 'corporate literacy' program, under which Independent company directors on boards will soon have to clear an exam before they can be appointed,

Announced by the top bureaucrat in charge of corporate affairs, Injeti Srinivas, the corporate literacy step aims to overhaul India's corporate governance system that in last few year has allowed number of frauds including the infamous IL&FS Scam and the recently uncovered $5.75 Mn Tax Scam by Manpasand Beverages Ltd (MBL), a Gujarat-based beverage company backed by SAIF Partners, which hold 25% stake in the firm.

“We want to demolish the myth that independent directors don’t have any fiduciary duty,” Srinivas said in an interview in New Delhi on June 6. “We want to propagate corporate literacy to make them aware of their duties, roles and responsibilities."

The exam will be an online assessment covering the basics of Indian company law, ethics, and capital market norms among other areas, Srinivas said.

Srinivas further affirmed that the aspirants will be allowed unlimited attempts albeit in a stipulated (fixed) time frame within which they have to pass the test.

Experienced directors who have already been on boards for several years will be exempt from the test but will have to register themselves on a database the government is preparing. This compilation will be a one-stop platform where companies looking for independent directors can meet those willing to serve, Srinivas said.

The existing law mandates that every company listed in India has to have independent directors accounting for at least a third of its board strength. The main responsibility of independent directors is to act as overseers outside the influence of the company he in the boards of. This "impartial supervision" safeguards the interests of minority shareholders.

The government is also looking to ban auditor Deloitte Haskins & Sells for five years after it did not flag risks from the activities carried out by fraud-hit NBFC IL&FS.

Essential Features of SPICe - MCA's New Procedure To Incorporate Companies/Startups

A lot of goodies are in store this festive season for the professionals and those in business.

The Ministry of corporate affairs has taken a very appreciable step in making company incorporations simple and fast. The Ministry, through a notification dated 01/10/2016, put forth the Fourth Amendment rules, 2016 for the incorporation of companies.

SPICE – or Simplified Proforma for Incorporating Company Electronically, simplifies the incorporation of a company through an online application form – INC 32, in addition to the Memorandum of Association (in Fomr – INC – 33) and Article of Association, INC – 34.

What does this signify to the professionals?

Apart from making the procedure simpler (since everything need to be e-filed), one can also fill a pre-drafted Memorandum and Article of Association online, thus, making it a hassle free process.

What is different?

Prior to May, 2015, the incorporation of companies required one to fill up several documents, such as the DIR – 3 for acquiring the DIN (Director identification number), INC- 1 for obtaining a name, Filling of INC – 7 for registering the company with the Memorandum and Articles of Association, an INC – 22 for registered office and finally, Form – DIR for directors.

However, with effect from 01/05/2015, the Ministry of Corporate affairs brought forward One form – INC – 29 for incorporation of companies. This form included all the details to be filled in the five forms as mentioned earlier. Also, the process of getting an approval (if all filing done correctly) was reduced to as low as 48 hours.

Now, the SPICE initiative, and the introduction of INC – 32, the similar facilities provided by INC – 29 will apply here too. However, what is ‘additional and much more progressive’ is the way the new system facilitates the filing of Memorandum and Article of Association, at the time of incorporation, and electronically. Filing of MOA and AOA online can save a lot of effort and time spent on their incorporation.

Although SPICE is introduced and the plans are put forth on the 1^st of October, further details will be furnished by the Ministry very soon and will definitely change the way the incorporations of companies will be done in future.

Salient Features of SPICE

• INC – 32 can be filed even if you have applied for the name of the company through INC – 1already. This is the difference between INC – 29 and the new E-form.


• As stated earlier, the major breakthrough is the fact that the SPICE provided MOA and AOA to be filed electronically, through forms INC- 33 and INC- 34. The MOA can be copy pasted from your file and the AOA can be pre-drafted against the clauses given in the form INC- 34. The whole process is completely simplified.


• Since MOA and AOA are to be filed digitally, the signatures of directors (Digital signatures) can be affixed with INC – 33 and INC -34.


• INC- 32 is quite similar to INC- 29, which makes is simpler to fill. The only addition here is this information regarding the MOA and AOA.

Thus, through SPICE, the Ministry of corporate affairs has made a considerable effort to reduce the hassles and time frame taken for incorporation as well as the paperwork involved.

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The above article is authored by Hrishikesh Datar, CEO & Founder of vakilsearch.com, a leading facilitator of legal services online.
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Nasscom to launch Startup-registry, for Startups to be discoverable for investors, media and government.

In order to gather information of all tech based start-ups in the country, NASSCOM will soon launch its nationwide start-up registry. NASSCOM will create a national database of tech startups and identify the areas in which they are operating.

According to the IT industry body, the registry will function as a discovery platform for media, investors, government and enterprises. NASSCOM is currently gearing up to launch the third phase of its '10,000 Start-ups' initiative. This platform will also provide the emerging start-ups the much needed exposure and an awesome opportunity to be discoverable for media, investors and government authorities.

According to R. Chandrashekhar, President, NASSCOM, India is soon turning into a hotbed for technology based start-ups and his organization’s ’10,000 start-up’ initiative will try to partner with all stakeholders to help India emerge as an innovation hub.

In the first two phases of this initiative which were spread over 2013, the industry body was able to attract a good 7,000 applicants.

Of these 7,000 applicants, 529 were shortlisted and finally 125 applicants received benefits like mentoring, funding, acceleration, enterprise connections, co-working spaces and showcase opportunities.

According to the NASSCOM President, the IT industry representative will use the experiences, learning from last year and even the insights it gained during InnoTrek in the planning of the third phase.

Intel, the global chip maker is all set to become the industry sponsor and collaborate with NASSCOM to turn India into a hotspot in the Internet of Things, which is a virtual representation of an internet structure with unique identifiers and power to transfer huge volumes of data over a network without any problem.

India’s most innovative emerging start-ups which are building world class products will be showcased in Hong Kong, Israel, Singapore and some European Countries this year by NASSCOM’s InnoTrek, a representative delegation of software solutions and products.

Ravi Gururaj, NASSCOM’s product Conclave Chairman also stated that his organization will focus on the NASSCOM-Google ‘girls in tech’ programme in order to increase the representation of women founders in start-ups.

NASSCOM will soon also launch a skills initiative that will focus on the tech start-up segment. It will create courses and modules which will impart skills ranging from product management and in-bound marketing to app development, user interfaces and analytics. A pilot project on this is expected to kick start in the next few months.

Nasscom to launch Startup-registry, for Startups to be discoverable for investors, media and government.

In order to gather information of all tech based start-ups in the country, NASSCOM will soon launch its nationwide start-up registry. NASSCOM will create a national database of tech startups and identify the areas in which they are operating.

According to the IT industry body, the registry will function as a discovery platform for media, investors, government and enterprises. NASSCOM is currently gearing up to launch the third phase of its '10,000 Start-ups' initiative. This platform will also provide the emerging start-ups the much needed exposure and an awesome opportunity to be discoverable for media, investors and government authorities.

According to R. Chandrashekhar, President, NASSCOM, India is soon turning into a hotbed for technology based start-ups and his organization’s ’10,000 start-up’ initiative will try to partner with all stakeholders to help India emerge as an innovation hub.

In the first two phases of this initiative which were spread over 2013, the industry body was able to attract a good 7,000 applicants.

Of these 7,000 applicants, 529 were shortlisted and finally 125 applicants received benefits like mentoring, funding, acceleration, enterprise connections, co-working spaces and showcase opportunities.

According to the NASSCOM President, the IT industry representative will use the experiences, learning from last year and even the insights it gained during InnoTrek in the planning of the third phase.

Intel, the global chip maker is all set to become the industry sponsor and collaborate with NASSCOM to turn India into a hotspot in the Internet of Things, which is a virtual representation of an internet structure with unique identifiers and power to transfer huge volumes of data over a network without any problem.

India’s most innovative emerging start-ups which are building world class products will be showcased in Hong Kong, Israel, Singapore and some European Countries this year by NASSCOM’s InnoTrek, a representative delegation of software solutions and products.

Ravi Gururaj, NASSCOM’s product Conclave Chairman also stated that his organization will focus on the NASSCOM-Google ‘girls in tech’ programme in order to increase the representation of women founders in start-ups.

NASSCOM will soon also launch a skills initiative that will focus on the tech start-up segment. It will create courses and modules which will impart skills ranging from product management and in-bound marketing to app development, user interfaces and analytics. A pilot project on this is expected to kick start in the next few months.