Companies Act amendments since 2023: what every CS should already be doing differently

The Companies Act, 2013 has not been wholesale replaced. It has been quietly remade. Between the Companies (Amendment) Act, 2020 (effective in stages through 2021 and 2022), the rule changes that followed, the MCA21 V3 portal migration, and the steady stream of amendments to the Companies (Specification of Definitions Details) Rules, the Companies (Incorporation) Rules, the Companies (Accounts) Rules, the Companies (CSR Policy) Rules, the Companies (Appointment and Qualification of Directors) Rules, and the Companies (Prospectus and Allotment of Securities) Rules, the day-to-day practice of a company secretary in 2026 looks meaningfully different from the practice in 2022.

This article covers what has changed, what the change means for ongoing compliance work, and what we still see CSs doing as though the older framework were in force.

MCA21 V3 and what the migration actually changed

MCA21 V3 went live in stages through 2022 and 2023, replacing the V2 portal that had governed corporate filings since 2006. The migration was promoted as a UI refresh. The substance was different.

E-form rationalisation. V3 consolidated multiple forms into single multipurpose forms. SPICe+ now covers incorporation, DIN allotment, PAN, TAN, EPFO, ESIC, GST, and bank account opening in a single application. AGILE-PRO subsumed the older AGILE and INC-35 forms. The CS who is still treating these as separate workflows is doubling work that the portal expects to be done together.

Annual filings on V3. AOC-4, MGT-7, and DPT-3 all moved to V3 with revised data fields. The MCA21 V2 file uploads many CSs were used to no longer apply. Form-level validations have tightened — fields that V2 accepted as text now require structured data.

Director and beneficial-owner data centralisation. Director KYC, beneficial-owner declarations, and the chain analysis underlying BEN-2 are now expected to pull from a centralised data pool. CSs filing BEN-2 against a snapshot of the shareholder register that does not match the centralised pool see error messages they did not see in V2.

Small company and OPC threshold revisions

The definition of 'small company' under Section 2(85) was revised in 2021 (effective 1 April 2021) and again in 2022. The current definition: paid-up share capital not exceeding ₹4 crore and turnover not exceeding ₹40 crore in the immediately preceding financial year.

The earlier limits were ₹50 lakh capital and ₹2 crore turnover. The expansion is material. A meaningful share of private companies that were medium-company-equivalent under the old definition are now small companies under the new one.

What this means in practice. Small companies are exempt from cash flow statement preparation, simplified board-meeting requirements (two meetings a year with a gap of at least 90 days, instead of four), reduced AOC-4 filings, and a different penalty regime under Section 446B. The CS who is still preparing four-board-meeting calendars and full cash flow statements for clients that now qualify as small companies is doing unnecessary work.

OPC eligibility was similarly relaxed. Resident NRIs are now permitted to incorporate OPCs and the conversion threshold (the point at which an OPC must convert to a private or public company) was widened.

CSR amendments and the ongoing-project tightening

CSR under Section 135 was amended twice — through the Companies (Amendment) Act, 2019 and the Companies (Amendment) Act, 2020 — and the Companies (CSR Policy) Rules were comprehensively rewritten in January 2021. The most material changes:

Mandatory spend. The 'comply or explain' framework moved to 'comply or transfer'. Unspent CSR funds either go into an ongoing project (with a tightly defined framework) or get transferred to a Schedule VII fund within six months of year-end. The CSR-2 form was introduced to report unspent amounts.

Ongoing project framework. The rules introduced a structured definition of 'ongoing project' (a project with a duration of more than one financial year, undertaken by the company in fulfilment of its CSR obligation, with timelines not exceeding three years). The tightening: the project must be approved by the board with specific milestones, monitored, and reported on. Treating a recurring annual donation as an 'ongoing project' to avoid the transfer obligation no longer works.

Impact assessment. Companies with average CSR obligation of ₹10 crore or more in the preceding three financial years must undertake impact assessment for projects with outlay of ₹1 crore or more, through an independent agency.

Negative list. Activities specifically excluded from CSR under Schedule VII have been clarified — political contributions, activities for employees, activities outside India (with limited exceptions for training of Indian sports personnel), activities in the normal course of business.

The CS preparing the CSR-2 disclosure, the impact assessment compliance file, and the unspent-amount transfer is doing work that did not exist as a workflow in 2020.

Independent director changes

Section 149 was amended (the database of independent directors, the proficiency self-assessment test) and the Companies (Appointment and Qualification of Directors) Rules were rewritten to operationalise the changes.

Independent directors' databank. The IICA (Indian Institute of Corporate Affairs) maintains a databank of individuals eligible to be appointed as independent directors. Appointment of an independent director by a company requires the individual to be registered on the databank and, except for those exempted by experience, to have passed the proficiency self-assessment test within one year of inclusion in the databank.

The exemption. Individuals with at least ten years' experience as a director or KMP in a listed company or in a public company with paid-up capital of ₹10 crore or more are exempt from the proficiency test, but must still be registered on the databank.

Disqualifications under Section 164. The grounds for disqualification have been clarified and the procedure for restoration after disqualification under Section 164(2) was tightened. CSs running director appointments need to check the databank registration and the proficiency-test status before the appointment, not after.

Digitalisation of board meetings

Board meetings by video conference are now permanently permitted for all matters, after the MCA's 2022 amendments to the rules removed the earlier list of items that could not be transacted by VC. The rule change is welcome but the practice has not entirely caught up — minutes still need to record the location of each director participating, the technology used, and the chair's confirmation that each director's identity was verified.

What we still see CSs doing as though nothing changed

Four patterns repeat across companies we onboard.

Filing AOC-4 and MGT-7 with V2 logic. The V3 forms have additional fields and stricter validations. A CS submitting on a Friday evening with V2-style data hits validation errors and resubmits multiple times. Time spent on resubmission can be eliminated by preparing the V3-compliant data structure upfront.

Treating recurring CSR donations as ongoing projects. The 2021 rule rewrite tightened the definition. A donation to the same NGO for the same purpose three years running, without structured milestones, is not an ongoing project. The unspent obligation transfers under Section 135(6).

Appointing independent directors without IICA databank registration. The DIR-12 will be accepted but the appointment is not compliant. This surfaces in diligence and in the MCA's compliance monitoring.

Holding four board meetings a year for small companies. Companies meeting the revised small-company definition can meet twice a year. Half the board calendar is unnecessary.

What changes in 2026 and beyond

We expect — though it is not enacted at the time of writing — further amendments around digitalisation, virtual general meetings as a permanent option, and a tightening of the related-party-transaction framework around indirect related-party flows. The CS who has built workflow around the post-2020 amendments will absorb the next round more easily than one who has been running pre-2020 workflows.

The discipline we recommend: at the start of each year, run a one-day review of every workflow against the current rules. The Companies (Amendment) Act, 2020 changes are now nearly five years old. The 2021 rule rewrites are nearly five years old. Workflows that have not been refreshed in that period are the most likely place for ongoing compliance to be silently incorrect.