The bill provides for buyback of shares and relaxation of procedures for transfer of company shares. It replaces the company amendment ordinance promulgated on January 7.

Before staging the walk out, the opposition members blamed the government for not giving satisfactory explanation for the measure. They particularly took on minister for company affairs M Thambi Durai for not replying to their queries on various provisions of the bill. They wanted to know, for example, if the companies could borrow from bank for buying back shares.

In his reply to the debate before passing the bill, Thambi Durai said the government would frame rules and guidelines for buyback of shares by domestic companies.

He said while the Securities and Exchanges Board of India (Sebi) would draftguidelines for the listed companies, the Department of Company Affairs (DCA) would put in place guidelines for unlisted companies.

The minister said the government would not allow the provisions of the bill to be misused and that action would be taken against those companies which misused their funds.