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AMENDMENT IN DEFINITION OF SMALL COMPANY

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The Ministry of Corporate Affairs has issued the Companies (Specification of Definition Details) Amendment Rules, 2022 on 15th September, 2022, effective from same date. By way of this amendment, the ministry has increased the threshold limits applicable to companies for being eligible as small company under Section 2(85) of the Companies Act, 2013 read with the Rule 2 (1)(t) of the Companies (Specification of Definition Details) Rules, 2014

It is to be noted that prior to this amendment, a small company, included a company which did not exceed the below mentioned threshold limits for paid up capital and turnover in the immediately preceding financial year.

  • the Paid up capital not exceeding Rs 2 crores AND
  • Turnover not exceeding Rs 20 crores

 

The notification dated 15th September, 2022, has increased these limits as laid below

  • Paid up capital not exceeding Rs 4 crores AND
  • Turnover not exceeding Rs 40 crores

 

Quick link

https://www.mca.gov.in/bin/dms/getdocument?mds=tiMs9IFJ8xuPm%252B%252Foxc6fUw%253D%253D&type=open

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