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Govt plans to rationalise filing framework under companies law

April 17, 2026 4 min read Economics Polity & Governance GS Paper 2 (Governance) GS Paper 3 (Economy Industry)
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What Happened

  • The Ministry of Corporate Affairs (MCA) has released a draft proposal to rationalise the filing framework under the Companies Act, 2013, aiming to significantly reduce the compliance burden on registered companies.
  • The reform proposes consolidating nine existing MCA forms into two new unified forms: E-CHNG (with Parts A–F) and E-CON (with Parts A–E).
  • The nine forms being replaced include INC-22, INC-23, INC-24, INC-6, INC-12, INC-18, INC-20, INC-27, and RD-1.
  • The proposal also overhauls company naming rules, rationalises KYC documentation requirements, removes multiple affidavit requirements, and introduces a digital-first approach to director consent and subscriber verification.
  • The MCA has sought public comments on the draft by May 9, 2026.
  • A separate initiative invites suggestions to simplify Fast-Track Mergers under the Companies Act.

Static Topic Bridges

Companies Act, 2013 and MCA21 Framework

The Companies Act, 2013 replaced the Companies Act, 1956, introducing a comprehensive governance framework for Indian companies. It is administered by the MCA through the MCA21 portal — an electronic filing and registry system where companies submit statutory returns, annual filings, and event-based disclosures. The Act covers about 23 lakh registered companies in India and mandates numerous periodic and event-driven filings.

  • MCA21 Phase 3 (launched 2022) introduced a new portal with improved user interface and AI-driven help.
  • Key filing categories: incorporation documents, annual filings (AOC-4, MGT-7), event-based filings (INC series, DIR series), charges (CHG series).
  • The Companies Act 2013 has been amended multiple times — key amendments include the 2017, 2019, and 2020 Amendment Acts.
  • MCA administers the Companies Act, LLP Act, Competition Act (via CCI), and Insolvency and Bankruptcy Code (IBC).

Connection to this news: The consolidation of nine forms into two is the most significant simplification of the MCA21 filing architecture since the portal's inception, directly addressing complaints from company secretaries, law firms, and small businesses about redundant and overlapping compliance requirements.

Ease of Doing Business and Regulatory Simplification

India has been on an active journey to improve its Ease of Doing Business (EoDB) rankings, climbing from 142nd in 2014 to 63rd in the World Bank's Doing Business 2020 report (the last published). Regulatory simplification — reducing forms, decriminalising minor defaults, and digitising processes — is a core pillar of this agenda under the National Action Plan for EoDB.

  • MCA has decriminalised numerous provisions of the Companies Act through the 2019 and 2020 amendments, converting criminal offences to civil defaults for procedural violations.
  • The MCA Amnesty Scheme 2026 allows companies to regularise past filing defaults with reduced penalties.
  • Compliance burden reduction is also linked to the Jan Vishwas Act (2023), which decriminalised 183 provisions across 42 central laws.
  • The National Single Window System (NSWS) aims to provide a one-stop clearance platform across ministries.

Connection to this news: The forms consolidation reform is a direct application of India's regulatory simplification philosophy — moving from form-heavy compliance toward a data-centric, outcome-focused regulatory architecture, consistent with the National Policy Framework on EoDB.

Fast-Track Mergers under Companies Act

Section 233 of the Companies Act, 2013 introduced a simplified merger procedure for small companies, holding companies, and wholly-owned subsidiaries, known as Fast-Track Mergers. Unlike the NCLT-supervised merger route (Section 230-232), Fast-Track Mergers are approved by the Regional Director (RD), reducing timelines from 9–18 months to 3–6 months. The MCA's current consultation on simplifying this route reflects industry demand for further efficiency.

  • Fast-Track Merger eligibility: holding-subsidiary mergers, mergers between two or more small companies, and merger of startups with other startups or small companies.
  • The scheme was extended to startups in 2021 via an MCA notification.
  • Creditor and member approval (75% by value) is still required even under the Fast-Track route.
  • India processed 782 mergers and acquisitions through NCLT in 2024-25.

Connection to this news: MCA's simultaneous consultation on Fast-Track Merger simplification alongside the forms rationalisation signals a holistic effort to reduce transaction costs for corporate restructuring, supporting the broader goal of building a competitive business environment.

Key Facts & Data

  • Nine forms being replaced: INC-22, INC-23, INC-24, INC-6, INC-12, INC-18, INC-20, INC-27, RD-1
  • New consolidated forms: E-CHNG (6 parts) and E-CON (5 parts)
  • Public comment deadline: May 9, 2026
  • Total registered companies in India: approximately 23 lakh (as of 2025)
  • MCA21 portal processes millions of filings annually; over 1.5 crore documents filed per year
  • India's EoDB rank: 63rd (World Bank 2020); World Bank discontinued the Doing Business index in 2021 and replaced it with the B-READY index
  • Companies Act 2013 has 470 sections and 7 schedules
  • MCA Amnesty Scheme 2026 allows regularisation of delayed filings with reduced additional fees