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In order to further improve the ease of doing business, the Ministry of Corporate Affairs (MCA) has yet again revised the threshold limit for paid-up capital of small companies. Earlier, the definition of small companies under the Companies Act, 2013 was revised by increasing their thresholds for paid-up capital from not exceeding Rs 50 lakh to not exceeding Rs 2 crore and turnover from not exceeding Rs 2 crore to not exceeding Rs 20 crore.

It stated this definition has, now, been further revised by increasing such thresholds for paid up Capital from not exceeding Rs 2 crore to not exceeding Rs 4 crore and turnover from not exceeding Rs 20 crore to not exceeding Rs 40 crore. This initiative is part of the government's proactive measures in the recent past towards ease of doing business and ease of living for the corporates.

These include decriminalisation of various provisions of the Companies Act, 2013 and the LLP Act, 2008, extending fast-track mergers to start-ups, incentivising incorporation of One Person Companies (OPCs) etc. Small companies represent the entrepreneurial aspirations and innovation capabilities of lakhs of citizens and contribute to growth and employment in a significant manner.

Moreover, it said that the government has always been committed to taking measures which create a more conducive business environment for law-abiding companies, including reduction of compliance burden on such companies.