New Delhi, Mar 14 (KNN) The former co-chair of FICCI Infra committee K K Kapila has reached out to Prime Minister Narendra Modi proposing to change the definition of Indian company in the Companies Act to make the country self-reliant.

The current definition of an Indian company is ‘any company registered in India, which pays taxes in India' is considered as an Indian company.

“This company could be a wholly-owned subsidy of a Chinese, American or a British company. This needs an immediate correction as currently, most of foreign companies are misusing this provision and deriving benefits meant for Indian companies,” Kapila said in a recent letter to PM Modi.

He said that the correction is an absolutely inescapable necessity, so that the benefits of Atmanirbhar Bharat are not harnessed by the foreign companies.

As per the current definition of Indian company, foreign companies are enjoying the benefits meant for Indian companies, the letter said.

“Once registered in India under the Companies Act 2013 (erstwhile Companies Act 1956), the company operates as an Indian company duly complying with the provisions of the Indian Company Law and Indian tax laws,” he mentioned.

Thus, a foreign company has virtually become an Indian company and is able to do business as an Indian company, after paying taxes and then take away all the profits out of the country.

Hence, he has proposed that the Companies Act, 2013 should re-define an Indian company, as one which is registered in India with more than 60 per cent shareholding of the company, is held by Indian nationals,” it said.

Kapila is also the former President of Consulting Engineers Association of India (CEAI). (KNN Bureau)