On September 15th 2022, the Ministry of Corporate Affairs (MCA) issued notification G.S.R. 700(E)  to amend the Companies (Specification of Definition Details) Rules, 2014 in exercise of the powers conferred on the Central Government to make rules under Section 469(1) and Section 469(2) of the Companies Act, 2013.
Under this amendment, Rule 2(1)(t) of the Companies (Specification of Definition Details) Rules, 2014 has been amended, which has reference to sub-clause (i) and (ii) of Section 2(85) of the Companies Act, 2013.
Section 2(85) of the Companies Act, 2013 defines a ‘small company’. Before the amendment, the paid-up capital limit for small companies was INR 2 Crores, and the turnover limit was INR 20 Crores. As per the amendment, companies with a paid-up capital limit of INR 4 crores and turnover limit of up to INR 40 Crores would be treated as ‘small companies’.
Small companies have a lot of benefits such as: