The Hindu Business Line : `Final decision on independent directors issue by next month'

Mr Prem Chand Gupta, Minister for Company Affairs, and Dr J.J. Irani, Chairman of Irani Committee, at a `National conference on new company law' in the Capital on Monday. - Kamal Narang

New Delhi , July 4

THE Minister of State for Company Affairs, Mr Prem Chand Gupta, on Monday said that a final decision on the number of independent directors on a company's board could be expected by August.

The Ministry is hoping to come out with a basic framework for a new and revised Company Law based on the recommendations of the J.J. Irani Committee by then.

The Minister was speaking at a National Conference on New Company Law, organised by the Confederation of Indian Industry.

Stating that ideally industry should be given the chance to decide what it feels and wants on the issue of independent directors, the Minister said, "We will discuss with SEBI and other stakeholders and try to resolve the issue by August."

Brushing aside the talk of `difference' between the market regulator and the Ministry on the issue of the board composition of the companies , Mr Gupta said that there was `no confrontation'. Asked to give his view on the matter, Mr Gupta said, "I personally feel that a company should be run by its promoters and shareholders."

The Minister also stressed that it is the quality of independent directors, which is important rather than the quantity. On whether the government nominees on public sector companies would be treated as independent directors, the Minister said that matter is being looked into.

Outlining his vision towards streamlining the Company's Act and the overall working of the Ministry, Mr Gupta said, "by the beginning of the winter session of Parliament, I hope to place the proposed Act on the floor of the House. My efforts would be to ensure that the proposed Act is not referred to the Finance Committee, so as to avoid delay."

Indicating his keen desire to enact the proposed Act, Mr Gupta said that he would talk to the Chairman of the Finance Committee, as also to the Speaker of the Lok Sabha, and explain to them the importance of the Bill.

Commenting on the initiatives taken to streamline the functioning of the Ministry, Mr Gupta said, measures have been taken to expedite the liquidation process. "The target is to finish the liquidation work in two-three years' time frame." Currently there are 5,700 cases pending with different official liquidators, and certain cases are pending since last 50 years.

To bring down the number of litigations pending before various authorities due to minor violations of company law such as non-filing of returns on time, the Minister said, "We have decided to withdraw cases pending before various courts for minor Companies Act violations."

Regarding the prospects of the Competition Commission of India (CCI), the Minister said, he was keen to take the work of CCI forward in right earnest.

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