The Ministry of Corporate Affairs (MCA), vide its notification dated December 01, 2025, has amended the Companies (Specification of Definition Details) Rules, 2014 (“Rules”). A substitution has been introduced under Rule 2(1)(t) of the Rules, resulting in a revision to Section 2(85) of the Companies Act, 2013 (“Act”), whereby the financial thresholds for classifying “small companies” have been enhanced.

Under the updated Rule 2(1)(t), a company shall now be considered a small company if:

1. Its paid-up share capital does not exceed ₹10 crores; and
2. Its turnover does not exceed ₹100 crores.

In effect, the notification widens the ambit of “small companies,” allowing more entities to benefit from reduced compliance and streamlined governance norms.