The government on Monday said the definition of small companies will be revised by raising the capital base to Rs 2 crore from the current limit of Rs 50 lakh. In the Union Budget for 2021-22, Finance Minister Nirmala Sitharaman proposed setting up of investor charter across financial products.
She said an asset reconstruction and management company will be set up for stressed assets of banks, while also stating that the National Company Law Tribunal (NCLT) framework will be strengthened.
Hardika Shah, Founder and CEO Kinara, said that the proposal made by the Finance Minister for small companies under the Companies Act, 2013, is a welcome move.
"The reduction of custom duty on raw materials for several sectors will help going forward. Digital payments, Textile Parks, and Socialization of the gig economy are effective moves to give a further fillip to the pace of last-mile digital transformation and financial inclusion," Shah said.
Satya Yerramsetti of Telebu said that enlarging the definition of small companies will provide thrust to the ease of doing business, ease of compliance, ease of living, and pave the way for aatmanirbhar and resilient India
Rajiv Kumar, the founder of StoreHippo, said that the increased limit of turnover to qualify as a small company will benefit many small businesses, particularly the ones that suffered losses during the pandemic.