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Renu Suresh

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Published on: Jun 24, 2026

Companies (Specification of Definition details) Amendment Rules 2021

The Ministry of Corporate Affairs (MCA) on February 01, 2021, has issued the

Companies (Specification of Definitions Details) Amendment Rules, 2021. The definition under the Companies Act, 2013 for Small Companies has now been revised by increasing their thresholds for Paid-up capital and Turnover. The paid-up capital and turnover of the small company shall not exceed Rupees 2 Crores and Rupees 20 Crores respectively. This new rule shall come into force on April 01, 2021. The current article briefs the Companies (Specification of Definition details) Amendment Rules 2021.

Synopsis of MCA Notification

The following amendment has been made in the Companies (Specification of Definition details) Amendment Rules

  • A new clause 2(1)(t) has been inserted in Rule 2 which specify the Definitions of Small Companies.
  • The definition under the Companies Act, 2013 for Small Companies has now been revised by increasing their thresholds for Paid-up capital from “not exceeding Rs 50 lakh” to “not exceeding Rs 2 crore” and Turnover from “not exceeding Rs 2 crore” to “not exceeding Rs 20 crore”

The official notification about the Companies (Specification of Definition details) Amendment Rules 2021 is as follows:

Companies (Specification of definitions details) Rules, 2014

Other Definitions provided under the Companies (Specification of definitions details) Rules, 2014 is as follows:

Certifying Authority - A person who has been granted a licence to issue a Digital Signature Certificate under section 24 of the Information Technology Act, 2000 and the Certified Filing Center (CFC) under the Companies Act Director Identification Number (DIN) - An identification number allotted by the Central Government to any individual, intending to be appointed as director or to any existing director of a company, for his identification as a director of a company
  • The Director Identification Number (DIN) obtained by the individuals before the notification of these rules shall be the DIN for the Companies Act, 2013
  • Director Identification Number (DIN) includes the Designated Partnership Identification Number (DPIN) issued under section 7 of the Limited Liability Partnership Act, 2008
E-Form - A form in the electronic form as prescribed under the Companies Act or the rules made thereunder and notified by the Central Government Electronic Mail - The message sent, received or forwarded in digital form using any electronic communication mechanism that the message so sent, received or forwarded is storable and retrievable Electronic mode means carrying out electronically based, whether the main server is installed in India or not including the following:
  • Business to business and business to consumer transactions, data interchange and other digital supply transactions
  • Offering to accept deposits or inviting deposits or accepting deposits or subscriptions in securities, in India or from citizens of India
  • Financial settlements, web-based marketing, advisory and transactional services, database services and products, supply chain management
  • Online services such as telemarketing, telecommuting, telemedicine, education and information research
  • All related data communication services
Electronic record means the electronic record as defined under clause (t) of sub-section (1) of section 2 of the Information Technology Act, 2000 Electronic Registry means an electronic repository or storage system of the Central Government in which the information or documents are received, stored, protected and preserved in electronic form Related Party A director or key managerial personnel of the holding company or his relative concerning a company shall be deemed to be a related part List of Relatives A person shall be deemed to be the relative of another if he or she is related to another in the following manner:
  • Father: Father includes step-father
  • Mother: Mother includes the step-mother
  • Son: Son includes the step-son
  • Son’s wife
  • Daughter
  • Daughter’s husband
  • Brother: Brother includes the step-brother
  • Sister: Sister includes the step-sister
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Frequently Asked Questions

Common questions about Companies Amendment Rules 2021: Small Companies Definition.

The Companies (Specification of Definition details) Amendment Rules, 2021 is a notification issued by the Ministry of Corporate Affairs (MCA) on February 01, 2021, which revises the definition of small companies under the Companies Act, 2013 by increasing their thresholds for paid-up capital and turnover.
As per the amendment, the paid-up capital of a small company shall not exceed Rs. 2 crores, and its turnover shall not exceed Rs. 20 crores.
The Companies (Specification of Definition details) Amendment Rules, 2021 will come into force on April 01, 2021.
The revised definition with increased thresholds for paid-up capital and turnover aims to provide relief to a larger number of companies by recognizing them as small companies, which may entail certain relaxations or compliance benefits under the Companies Act, 2013.
The Companies (Specification of definitions details) Rules, 2014 also provide definitions for terms like Certifying Authority, Director Identification Number (DIN), E-Form, Electronic Mail, Electronic mode, Electronic record, Electronic Registry, and Related Party.
The Rules define a "relative" as a person who is related to another in the manner specified, such as father, mother, son, daughter, brother, sister, and their respective spouses.
The Companies (Specification of definitions details) Rules, 2014 aim to provide clarity and specify the definitions of various terms used in the Companies Act, 2013, and its related rules and regulations.
Yes, the Ministry of Corporate Affairs periodically issues amendments, clarifications, or updates related to the Companies Act, 2013, and its associated rules and regulations. It is advisable to stay updated with the latest notifications and changes.
The official notification for the Companies (Specification of Definition details) Amendment Rules, 2021, is available on the Ministry of Corporate Affairs website or other authoritative sources like the article provided.
Companies should evaluate their paid-up capital and turnover figures to determine if they qualify as small companies under the revised definition. If they do, they may need to assess and comply with any specific compliance requirements or relaxations applicable to small companies under the Companies Act, 2013.