The document outlines 16 exceptions to various sections of the Companies Act, 2013 for private companies. Key exceptions include: - Related party definitions do not apply to certain holding/subsidiary relationships. - Private company articles of association can have relaxed provisions regarding share capital and voting rights. - Private companies can issue shares with member consent periods less than 15 days. - Private companies can issue employee stock ownership plans with ordinary resolutions. - Certain private companies are exempt from restrictions on share purchases and loans. - Private companies face fewer restrictions on director appointments and interested party transactions.

1. S.
No.
Chapter/Section
number/Sub-
section(s)in the
Companies
Act,2013
Exceptions Effect
1. Chapter I, sub-
clause (viii) of
clause (76) of
section 2
Shall not apply with respect to
section 188.
Change in definition of ‘Related Party’ now
onwards the following class of companies are
not covered under the definition of related
parties :2(76) (viii) any company which is—
(A) a holding, subsidiary or an associate
company of such company; or
(B) a subsidiary of a holding company to
which it is also a subsidiary;
2. Chapter IV,
section 43 and
section 4 7
Shall not apply where
memorandum or articles of
association of the private company
so provides
Section 43 talks about ‘Kind of Share Capital’
and section 47 talks about ‘Voting Rights’.Now
AOA of Private Company can have relaxed
provisions w.r.t. these sections.
3. Chapter IV, sub-
clause (i) of
clause (a) of sub-
section (1) and
sub-section (2) of
section 62
Shall apply with following
modifications:-In clause (a), in sub-
clause (i), the following proviso
shall be inserted, namely:-
Provided that notwithstanding
anything contained in this sub-
clause and sub-section (2) of this
section, in case ninety per cent. of
the members of a private company
have given their consent in writing
or in electronic mode, the periods
lesser than those specified in the
said sub -clause or sub-section
shall apply
Section 67(1) provides that in case of further
issue of shares the shares must be offered to
existing equity share holders and company
need to offer these shares by way of sending
notice and limiting a time minimum 15 days
and maximum 30 days to accept or reject the
offer.Now with the consent of 90% members,
a Private Company can fix period lesser than
the prescribed period of 15 days.
4. .Chapter IV,
clause (b) of sub-
section (1) of
section 62
In clause (b), for the words “special
resolution”, the words “ordinary
resolution” shall be substituted.
Now a private company can issues ESOP by
passing ‘Ordinary Resolution’ instead of
‘Special Resolution’

2. 5. Chapter IV,
section 67
Shall not apply to private
companies -(a) in whose share
capital no other body corporate has
invested any money;
(b) if the borrowings of such a
company from banks or financial
institutions or any body corporate is
less than twice its paid up share
capital or fifty crore rupees,
whichever is lower; and
(c) such a company is not in default
in repayment of such borrowings
subsisting at the time of making
transactions under this section
Restrictions are removed on purchase by
private company or giving of loans by it for
purchase of its shares.
6. Chapter V,
clauses (a) to (e)
of sub- section
(2) of section 73.
Shall not apply to a private
company which accepts from its
members monies not exceeding
one hundred per cent. of aggregate
of the paid up share capital and
free reserves, and such company
shall file the details of monies so
accepted to the Registrar in such
manner as may be specified.
Now a private company may accept deposit
from its members without following conditions
mentioned under section 73(2)(a) to (e)
7. Chapter VII,
sections 101 to
107 and section
109
Shall apply unless otherwise
specified in respective sections or
the articles of the company provide
otherwise
Now a private company may have different
provisions in its AOA for the following
sections;101-Notice of Meeting
102- Statement to be annexed to notice
103-Quorum of Meeting
104- Chairman of the Meeting
105- Proxies
106-Restraiction on voting rights
107- Voting by show of hands
8. Chapter VII,
clause (g) of sub-
section (3) of
section 117
Shall not apply. A private company is not required to file E-
form MGT 14 for resolutions passed under
section 179(3) e.g. resolutions passed to
approve financial statements etc.
9. Chapter X,
Clause (g) of
sub-section (3) of
section 141.
Shall apply with the modification
that the words “other than one
person companies, dormant
companies, small companies and
private companies having paid-up
share capital less than one hundred
crore rupees” shall be inserted after
the words “twenty companies”.
Specified Private Companies are excluded
from the limit of 20 Companies.Now there is
no limit for Chartered Accountants to be
appointed as statutory auditor of a Private
Company having paid up capital less than 100
crore.
10. Chapter XI,
section 160.
Shall not apply. The whole section 160 shall not apply it mean
that no need to deposit Rs. 1 Lac by person
desirous to be appointed as director in
General Meeting.

3. 11. Chapter XI,
section 162.
Shall not apply. More than 1 director can be appointed through
one resolution.
12. Chapter XII,
section 180.
Shall not apply. Now there is no restrictions on powers of
Board. Therefore no need to pass ‘special
resolution’ for borrowing in excess of paid up
capital etc.
13. Chapter XII, sub-
section (2) of
section 184.
Shall apply with the exception that
the interested director may
participate in such meeting after
disclosure of his interest.
Now a interested director can participate in
resolution in which he is interested.
14. Chapter XII,
section 185
Shall not apply to a private
company -(a) in whose share
capital no other body corporate has
invested any money;
(b) if the borrowings of such a
company from banks or financial
institutions or any body corporate is
less than twice of its paid up share
capital or fifty crore rupees,
whichever is lower; and
(c) such a company has no default
in repayment of such borrowings
subsisting at the time of making
transactions under this section.
Now specified private company can give loan
to its directors and related parties.
15. Chapter XII,
second proviso
to subsection (1)
of section 188
Shall not apply Now a interested members can vote on
resolutions in which he is a related party
16. Chapter XIII,
sub-sections (4)
and (5) of section
196.
Shall not apply Now appointment of a MD WTD or Manager
can be made in board meeting, requirement of
consent of members in next general meetings
is no longer required.