Companies Amendment Act 2020: Sections 204, 232, 242, 243, 247, 284 and 302
Updated: 18 September 2026
The Companies (Amendment) Act, 2020 (Act 29 of 2020) amended several provisions of the Companies Act, 2013. The provisions covered on this page principally rationalise penalties, remove imprisonment from specified defaults, revise the procedure for cooperation with a Company Liquidator, and change the procedure for recording dissolution orders.
Quick summary of the 2020 changes
| Companies Act provision | Subject | Key effect of 2020 amendment |
|---|---|---|
| Section 204(4) | Secretarial audit | Fine framework replaced by a fixed statutory penalty of Rs. 2 lakh. |
| Section 232(8) | Merger or amalgamation order filing | Failure to comply with section 232(5) attracts monetary penalties, including a continuing-failure component subject to a cap. |
| Section 242(8) | Contravention of Tribunal-related requirement | Imprisonment component removed; monetary fine retained. |
| Section 243(2) | Acting in contravention of section 243 | Imprisonment component removed; fine up to Rs. 5 lakh retained. |
| Section 247(3) | Registered valuer contravention | General contravention changed to a penalty of Rs. 50,000; fraud-related consequences remain separately governed by the proviso. |
| Section 284 | Assistance to Company Liquidator | Non-cooperation is addressed through an application to the Tribunal for directions. |
| Section 302 | Dissolution by Tribunal | Tribunal must act within 30 days as specified; former sub-section (4) was omitted. |
Amendment to Section 204: Secretarial Audit
What Section 204 covers: Section 204 of the Companies Act, 2013 deals with secretarial audit for prescribed classes of companies and the related duties of the company and company secretary in practice.
The Companies (Amendment) Act, 2020 changed sub-section (4). The earlier wording prescribing a fine ranging from Rs. 1 lakh to Rs. 5 lakh was replaced by a penalty of Rs. 2 lakh.
Amendment to Section 232: Merger and Amalgamation
What Section 232 covers: Section 232 governs mergers and amalgamations of companies through the National Company Law Tribunal. Sub-section (5) requires a certified copy of the Tribunal's order to be filed with the Registrar within the prescribed statutory period.
The 2020 amendment substituted sub-section (8). If a company fails to comply with sub-section (5), the company and every officer in default are liable to a penalty of Rs. 20,000. For a continuing failure, a further penalty of Rs. 1,000 applies for each day after the first, subject to a maximum of Rs. 3 lakh.
Amendment to Section 242: Powers of the Tribunal
What Section 242 covers: Section 242 sets out the powers of the National Company Law Tribunal when it finds that a company's affairs have been conducted in a manner that justifies relief in an oppression or mismanagement proceeding under the Act.
In sub-section (8), the Companies (Amendment) Act, 2020 omitted the words providing for imprisonment for a term that could extend to six months. It also removed the words referring to punishment "with both", leaving the monetary fine specified by the provision.
The amendment is part of the wider decriminalisation and rationalisation of specified corporate defaults undertaken by the 2020 Act.
Amendment to Section 243: Consequences of Termination or Modification of Certain Agreements
What Section 243 covers: Section 243 deals with the consequences that follow when an order under section 242 terminates, sets aside or modifies specified managerial agreements and restricts certain appointments or acts following such an order.
For sub-section (2), the 2020 amendment removed the imprisonment component that could extend to six months. The provision continues to prescribe a fine that may extend to Rs. 5 lakh for the contravention described in that sub-section.
Amendment to Section 247: Valuation by Registered Valuers
What Section 247 covers: Section 247 governs valuations required under the Companies Act and requires valuation by a person having the prescribed qualifications and experience and registered as a valuer, subject to the Act and applicable rules.
The Companies (Amendment) Act, 2020 amended sub-section (3) by replacing the earlier general fine range of Rs. 25,000 to Rs. 1 lakh with a penalty of Rs. 50,000.
The proviso dealing with a contravention committed with intent to defraud is distinct from the general penalty and should be read separately in the current consolidated text.
Amendment to Section 284: Promoters and Directors to Cooperate with Company Liquidator
What Section 284 covers: Section 284 requires specified persons, including promoters, directors, officers and employees, to extend assistance and cooperation to the Company Liquidator in the discharge of liquidation functions.
The 2020 amendment substituted the earlier sub-section (2) and introduced a Tribunal-based enforcement mechanism. If a person required to assist or cooperate under sub-section (1) does not do so, the Company Liquidator may apply to the Tribunal for necessary directions.
On such an application, the Tribunal may direct the person concerned to comply with the Company Liquidator's instructions and cooperate in the discharge of the Liquidator's functions and duties.
Amendment to Section 302: Dissolution of Company by Tribunal
What Section 302 covers: Section 302 provides for dissolution of a company by the Tribunal after its affairs have been completely wound up or where the Tribunal considers dissolution just and reasonable in the circumstances specified by law.
The 2020 amendment substituted sub-section (3). It provides that, within 30 days from the date of the dissolution order, the Tribunal shall forward a copy of the order to the Registrar for recording the dissolution and shall direct the Company Liquidator to forward a copy to the Registrar for the same statutory record.
The amendment also omitted sub-section (4), which had dealt with default by the Company Liquidator in forwarding the order within the earlier statutory period.
Official legal sources
For the authoritative text and subsequent updates, refer to the Companies (Amendment) Act, 2020 - Ministry of Corporate Affairs, the Companies Act, 2013 - Ministry of Corporate Affairs, and India Code - Companies Act, 2013.