The long-awaited new Company Law, which aims to ease the process of doing business in the country by simplifying the existing Companies Act, has finally received Indian Parliament's approval.

The new legislation, which was approved by the Lok Sabha in December 2012, gained Rajya Sabha's approval on Thursday, August 15.

The new legislation aims to remove complexities of the existing Companies Act as well as enhance governance by making companies more accountable.

In addition, the new law will allows for class action suits, make spending on corporate social responsibility obligatory and force companies to ensure gender equality on their boards.

It will further force companies to make sure that their independent directors do not make any monetary transaction with their companies of worth equivalent to or more than 10 per cent of revenue.

It will also equip the government with the power to inspect auditors registered under the section 22 of the Chartered Accountants Act of 1949.

The new legislation now requires President Pranab Mukherjee's nod to formally replace the Companies Act of 1956 and take force as the Companies Act, 2013.