The Ministry of Corporate Affairs (“MCA”), in exercise of its powers under Section 173, Section 177, Section 178 and Section 186 read with Section 469 of the Companies Act, 2013 (“Act”), vide Notification No. G.S.R. 811(E),[1] dated November 03, 2025, has notified the Companies (Meetings of Board and its Powers) Amendment Rules, 2025 (“Amendment Rules”). The amendment Rules modify Rule 11(2) of the Companies (Meetings of Board and its Powers) Rules, 2014, which relates to the interpretation of the expression ‘business of financing industrial enterprises’ under Section 186(11)(a) of the Act.
Key Amendments
The Amendment Rules provides a revised scope and clarification of what constitutes the ‘business of financing industrial enterprises’ for the purposes of Section 186(11)(a) of the Act, which exempts certain classes of companies from the restrictions applicable to inter-corporate loans and investments.
The substituted provision now expressly clarifies that:
- For Non-Banking Financial Companies (NBFCs) registered with the Reserve Bank of India (RBI), the business of financing industrial enterprises includes the ordinary course of activities involving lending, guarantees, or providing security for loans.
- For Finance Companies registered with the International Financial Services Centres Authority (IFSCA), the business of financing industrial enterprises will encompass activities permitted under the IFSCA (Finance Company) Regulations, 2021, specifically those enumerated under certain sub-regulations of Regulation 5(1).
[1]mca.gov.in/bin/dms/getdocument?mds=zj7qaq1Fnye3cB5LBw5mFw%253D%253D&type=open