Exemptions Under the Companies Act 2013 To Companies Licensed u/s 8

Section 8 (Nonprofit) Companies are exempted from certain
provisions of the Indian Companies Act, 2013 as per section 462 of Companies
(Amendment) Act 2015. Since a number of new NPOs in India are now registering
under this Act instead of the Trusts or the Societies Registration Act, the
following information should be of interest and importance.
 

1. Definition of Company Secretary [Clause
   (24) of Section 2]: The definition of Company Secretary to be appointed to
   perform the functions of a company secretary shall not apply.
2.  Definition of Private Company [Clause
   (68) of Section 2]: The requirement of
   having minimum paid-up share capital shall not apply.
3. Definition of Public Company [Clause
   (71) of Section 2]: The requirement of
   having minimum paid-up share capital shall not apply.
4. Time, Date and Place of AGM [Section
   96(2)]: Every company other than a One-Person Company (OPC) is required to call
   Annual General Meeting (AGM) during business hours (i.e. between 9 a.m.  and 6 p.m.) on any day except National
   Holiday and shall be held either at the registered office or within the city/
   town/ village in which the registered office of the company is situate.
   However, the Central Government exempts
   section 8 companies from the above requirements
5. Notice Period for GM [Section 101(1)]: Companies licensed
   under section 8 may give notice for calling a general meeting just before 14 days instead of 21 days.
6.  Minutes of Proceeding of General Meeting [Section
   118]: The minutes may be recorded within
   30 days of the conclusion of every meeting.
7. Copy of Financial Statements [Section 136
   (1)]: Companies  registered  with 
   charitable  objects  shall 
   send  a  copy 
   of  the  Financial 
   Statements,  including
   Consolidated Financial Statements (CFS), if any, Auditor’s Report and every
   other document required by law to be annexed or attached to the financial
   statements, which are to be laid before a company in its general meeting
   to  every member  of the 
   company,  to  every 
   trustee for  the  debenture holder  of 
   any  debentures  issued 
   by  the company,  and 
   to  all  persons 
   other  than such  member 
   or  trustee,  being 
   the  person so  entitled, 
   not  less  than
   fourteen days (instead of twenty-one days) before the date of the meeting.
8. Minimum and Maximum Number of Directors [Sec
   149(1)]: A One-Person Company shall have
   minimum one director; a private company shall have minimum two directors and a
   public company shall have at least three directors.
   Additionally, a company may appoint
   maximum 15 directors. To increase number of directors from more than
   fifteen, the company must pass Special Resolution in General Meeting. Companies registered with charitable objects
   are free to appoint any number of directors and there is no need to pass
   special resolution for appointment of more than 15 directors.
9. Independent Directors in Board [Section
   149(4) to 149(12)]: Section  8 
   companies are  not  required 
   to  comply  with 
   the  provisions  relating 
   to  definition  of 
   independent directors, requirement of minimum number of Independent
   Directors, time limit for appoint and reappointment of an Independent Director,
   declaration of status by Independent Director, abide by Schedule IV,
   entitlement of stock option and remunerations, term of office of independent
   directors and retirement of directors by rotation etc.
10. Data Bank of Independent Directors [Section
    150]: The selection of an Independent Director may be made from the data bank
    maintained by a body, institute or association notified by the Central
    Government. Data bank contains names, addresses and qualifications of persons
    who are eligible and willing to act as independent directors in a company.
    However, companies licensed under the
    provisions of section 8 of companies act, 2013 need not comply with such
    requirements.
11. Consent of Directors to Registrar [Section
    152(5)]: Appointed directors have to give their consent to hold office as
    director and such consent has been filed within 30 days of appointment to
    registrar. However, the above provision shall not apply to companies registered
    u/s 8 of the CA 2013.   
12. Right of persons to stand for Directorship
    [Section 160]: The appointment of
    directors except retiring directors in companies licensed u/s 8 of CA 2013 shall
    not require sending notice of 14 days along with deposit of 1 lakh rupees for
    being eligible for appointment to the office of a director at any general meeting.
    
13. Number of Directorship [Section165(1)]: A person shall not
    hold office as a director in more than 20 companies and the maximum number of
    public companies in which a person can be appointed as a director shall not
    exceed 10. The above maximum limit for directorship is not applicable in case
    of companies registered under section 8 of the Companies Act, 2013.
14. Minimum Number of Board Meetings [Section 173(1)]: Section 8 companies are
    required to hold at least one Board Meeting (BM) within every 6 calendar months
    i.e. two BM in one year instead of
    minimum four meetings of its Board of Directors every year. Additionally, there
    is no restrictions of time gap (i.e. 120 days) between two consecutive meetings
    of the Board.
15. Quorum for Board Meeting [Section
    174(1)]: The quorum for a meeting of the Board of Directors of section 8
    companies shall be either 8 members or 25% of its total strength, whichever is
    less. However, the quorum for such board meeting shall not be less than two
    members.
16. Independent Directors in Audit Committee [Section
    177(2)]: There is no need to constitute Audit Committee with independent
    directors forming a majority.
17. Nomination and Remuneration Committee [Section
    178]: Companies registered u/s 8 are not required to constitute such committees.
18. Powers of
    Board [Section
    179(3)]: There is no need to pass a resolution at meetings of board by section
    8 companies for borrowing monies, investing funds, granting loans and giving
    guarantee or providing security in respect of loan. The above matters may be
    decided by the board by circulation.
19. Disclosure of interest by Directors [Section
    184(2)]: Every director of section 8 (Non-Profit) Companies shall disclose the
    nature of his concern or interest at board meeting in case of related party
    transactions exceeding one lakh rupees and he shall not participate in such
    meeting.   
20. Register of Contracts for Directors [Section
    189]: If there are related party transactions exceeding one lakh rupees then
    every company registered with charitable objects shall keep registers giving
    separately the particulars of all contracts or arrangements to which section
    184(2) or section 188 applies.