Key amendments to the Companies (Incorporation) Rules, 2014: Reduction of compliance burden

The Ministry of Corporate Affairs has proposed amendments to the Companies (Incorporation) Rules, 2014 through a public notice dated 8 April 2026, inviting public comments on the draft Companies (Incorporation) Amendment Rules, 2026.

A key feature of the proposed amendments is the consolidation of multiple incorporation and post‑incorporation forms into two simplified electronic forms. For instance, Forms INC‑4, INC‑22, INC‑23 and INC‑24 are proposed to be merged into a single form titled ‘E‑CHNG’. Similarly, Forms INC‑6, INC‑18, INC‑12, INC‑20, INC‑27, RD‑1 and INC‑28 are proposed to be consolidated into a single form called ‘E‑CON’. This consolidation is intended to reduce repetitive disclosures, minimise procedural complexity, and improve efficiency for businesses undertaking routine corporate actions.

Further, it is proposed that the limit on the number of Director Identification Numbers (‘DINs’) that can be applied for at the time of incorporation be increased from three to five. Consent of individuals who are also subscribers to the Memorandum of Association is intended to be treated as deemed consent to act as directors. For other proposed directors, consent is purported to be captured either through OTP‑based authentication or, where OTP is not used, through Form DIR‑2.

Significant changes have also been proposed in relation to company name reservation and availability. The existing rules governing company names are proposed to be redrafted in simpler and clearer language, with detailed guidance on what constitutes a name that is too similar or undesirable. Greater clarity has been introduced regarding trademark‑based objections, descriptive names, and the use of generic or geographic terms. Also, flexibility has been provided for registration of name by proposing an ability to withdraw a reserved name before incorporation or change of name, if required.

The proposal further rationalises provisions relating to the registered office. Proof of the registered office address are now proposed to include a wider array of documents, such as utility bills, tax receipts, or allotment letters, depending on whether the premises are owned, rented, or part of a co‑working space. Physical verification by the Registrar of Companies (RoC) will not be mandatory in all cases and will be undertaken only where genuinely required.

Provisions governing the shifting of a registered office from one state to another are also proposed to be amended. Under the proposed amendments, companies will be allowed to serve notices relating to the change of registered office to debenture holders, creditors, the Registrar, SEBI, and other concerned regulators through speed post or email, instead of only by registered post. Additionally, the proposed amendment to Rule 30(9) (relating to the shifting of a registered office from one State or Union Territory to another) will permit such shifting, in limited circumstances, even where an inquiry, inspection, or investigation is pending, subject to safeguards and undertakings by the Board.

Other proposed amendments include the introduction of a new rule addressing the liability of legal representatives where a subscriber dies before paying for the shares subscribed in the Memorandum. In such cases, the legal representative will be liable to pay the unpaid amount, and upon payment, will step into the shoes of the subscriber and enjoy the same rights as if they were the original subscriber. 

Overall, the proposed amendments seek to modernise incorporation and compliance procedures, eliminate duplication, enhance clarity of the rules, and align the regulatory framework with evolving business practices and digital systems, while continuing to maintain necessary safeguards under the Companies Act, 2013. Once implemented, these changes are expected to significantly simplify the process of company incorporation and post‑incorporation compliance.

[The author is an Associate in Corporate and M&A practice at Lakshmikumaran & Sridharan Attorneys, Hyderabad]