Central Government on Thursday, 10th March, 2016, has issued an order vide S. O. (E)___,  pursuant to Section 68(2)(d) of the Companies Act 2013 provides that the ratio of the aggregate of secured and unsecured debts owed by the company after buy-back should not be more than twice the paid-up capital and its free reserves.

Provided that the Central Government may, by order, notify a higher ratio of the debt to capital and free reserve for a class or classes of companies.

In exercise of the powers conferred under the proviso to clause (d) of sub-section (2) of section 68 of the Companies Act, 2013, the Central Government has notified that –

The debt to capital and free reserves ratio shall be 6:1 for government companies as defined under section 2(45), which carry on Non Banking Finance Institution activities and Housing Finance activities.

The said Order can be accessed at the following Link: Order_S.O. (E)_Section 68 (2)(d)_Debt Ratio for Govt Company10.03.2016_