1. The document is a representation from Company Secretaries to the Minister of Corporate Affairs requesting a review of recently notified rules under the Companies Act 2013. 2. It requests reducing the capital limit for mandatory appointment of KMPs and extending the scope of secretarial audit and annual return certification. 3. It highlights how the new rules exclude many private and smaller public companies from compliance requirements and certifications that help ensure governance.

1. -L'lri. IIor~'I:,ioh i l i l ~ i s t c l *01'-itheMinistry of Corporate Affairs,
Sl~l~,j~'r'l:/I)I)c;II 1 0 I-CV~CW l i ~ l a lRules of Conll~aniesAcl, 2013 and 111ot1il:)i
I IICIII soo(1 ;IS11ossibIe.
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I'he i-ecc:Iit a~inouncementsof the Rules under the Colnpariies Act , 2013
is Ir;.;r:i~.~!.; r~luclllo be desired. We the undersigr~edrepresemti~:?,this
I.)OCI.II~~C:I~L C~lltai~li~igthe requests and appeals from die .Piernbc~.sol'
I I ;l~~oli:~vcliI lccl this representation 017 behalf of Company Sct:seli~ry
~ I I I I I I I VvhicI.~has always acted as the COI-po~-atcL.:.ivand
Ciovel.naiice Specialists and as an Institution set up under an Act 01..
1 ; I I - i 11 1980, We as Company secretary Colnpsise more [ha!)
.31i.O(iO 111c.riibcrs:11-d4 lacs Students working for the Corporate Secto~'
a ~ i lVii/i(M~ I I ~ S I I . ~of Corporate Affairs) to ensure that the Co~~lplial~ce
is rnailll~~irledat all levels.
Si1.. Over the past decade Cornpany Secretaries have worked tirelcssiy
ui~l'll . 1 ~Ministl.y ol' Corporate Affairs and.have assisted in total fillings
I 4 I:rcs till 3 1'' march 2014".Our pro:fessionals have cont1.ibiireci
III.IIIICIISC~Yto the sLlccess of MCA 21 there were more than O ~ i rlac
culnpanies registered online wherein key role was played by 11s.

2. We also wis11 to bring your ltilld attention more than 6 lacs Alin~lal
~-etul.nsfiled every year as per old Companies Act, 1956 were eel-tifietl
by OLII. 1ne11ihers ancl t11ey gave Secretarial Conipliance Report [or
co111l~:rnieshaving paid up capital of Rs. 10 Lakhs or more but less Ll?ali
5 CI..Fl'liishelped the Ministry to a great extent. If you kindly look a1 the
~icwI1~.ovisionsof Section 92 of the Companies Act ,20 1 3, it only tal ks
ill~oltl. I I .istecl col1ipanies and col~~pal~ieshaving paid L I ~ Icapital ol'lls.
I0 CI.01. 11101.e 01. 'l'l.~l.noverof Rs. 50 Cr or more shall gel its A I I I I L I ~ ~
IICLLII-IICel-ti(ied by a Company Secretary in Practice, l'liis will s~u-ely
a ['li'ct tlie 13x1ice side of our profession .
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II Wc b i g t o lig11t our llumble sub~nissionon the following areas
~icctlingYOLII.iln~nediateattention( the mails of lndividual sublnissio~is
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ha vc w 11-eatlybeen sent through various representations to your OTlicials
;II [lie Minis~l-y) We prepare a brieffor quick action at your end :-.
I i I . --A [ ) l ~ o i l l t ~ l ~ c l ~ tof KMP:-As per section 203 of the Companies Act,
I ' 20 13 read with relevant rules, every listed coinpany and every
olliel pu bl ic companies having paid up capital of Rs. 1.0 Cr or inore
sllali have a whole-time KM:P'(MD, WTD, Manager, CS, etc.)
I wl1icli i~nplies that Private companies and unlisted public
I' colnpallies not having paid up capital as aforesaid are not in lieecl
to comply with provisions of Law, which act~~allyis not the very
in [cntion of law makers, because Company Secretary which is also
Imown as Governance Professional is the only professio~~which
~ I ~ S L I I - e sco~npliance of the Law whether Companies Act or
otl~el-wise.If' we go by the earlier Rule notified on the lCM.lls, every

3. li s ~ e i lcompanies and every other companies having paid up capi~al
o l Rs.3 Ct- or more were in need to appoint a whole-time 1<.M.I1
LVII~CII was very much in line with intention of tlze Law Malters,'
1ioweve1-,tlie limit of Rs. '5 Cr has been increased upto 10 CI-ant1
~v-i/atccornpan ies have been exempted and excl~isivelyItepL out o1.-
pu~-viewol-'the section in question which is notlqil~gb ~ ~ tan L I ~ I I I ~ S L
slioclt to a.1l stalteholders.
2. .Sc.cr.clar-iill------ Audit:-As per section 204 read wit11 relevant I-ules
cjcl.y l isled companies and every other public coi~~paliieshaving
paid ~113capilal of Rs. 50 Cr or More or Turnover OF Rs. 250 CI.or
Mo1.c slv~llannexed with its Boards' Report a Secretarial Audit
I:clm~.[ give11by a Compa~~ySecretary in Practice. The very el'fect
01' section 203 and sectioii 204 read with relevalit Rules is ~hal
Privale Companies and unlisted public coinpany having paid up
I I as arbresaid is free from compliance because, neither they
nccil to have a whole-time-col n b a Secretary nola they reqiiired lo
alinesecl Secretar-ial Audit to its Boards' Report. It is pel-line~ltlo
1io1cihal by intl.oducing these sections and cori.espo1ldi11grulcs, we
a/-c t~.yi~~yto have check on big public co~~~paiiieswhich are
already compliant due to some or reasons and OII other side we are
p~.ovicli~igampie space to companies in middle range to indulge ill
non-compliance and lnalpractices by keepil~gtlze113 oul of the

4. pu~-viewof sections in question which definitely would not have
beel-Ii I ~ L ~ I - I ~ : ~ O I ~of the Law Malters.
3 . --J ' I - L ' c c I . ~ ~ ~ ~ c H ~ ~ ~ I Iof dorms:- The pre certification of e ibl-117shas
hcc11 p~.oveclas a good tool in the 11ands of Minist~.yi1-selI' 1.01. ~
C I I S L I S ~ I I ~liling of e forms complete in all aspects and also ibr.
SCCI-I1.i113beltel- compliance of relevant provisions. The MCA has
vi t l ~ dl.awli p1.e certification of various e forlns which actual ly is I
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agai 17stthe very intention of the Law, Corporate Con7pliance and i
Cove~.nance.The very reason behind this is professional certifying
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thc I'o1.117~lsuallyensures proper attachments and all which has
bccil cvidenl by better~nentin the quality of forms being file~l.~I7ie
/vor.l; load 01' your officers in the Mi~~istl-yseduces a lot as OLII.
111~11-lbersact as extended arm of MCA. I
4.-Ccr.lifici~tionof Annual Return (Section 92 of CA, 2013):- As I I
X II
per section 92 of the Companies Act, 2013 read with releva111
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I I s I I I I..isted companies and compa~~ieshaving paicl L I ~ Ical~iti~l
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01' I<s.I0 CI.01.n101-eor Turnover of Rs. 50 Cr or more shall gct its
A I I I ~ L I ~ ~R~LLII-11Certifled by a Company Secretary jin P~~actice.l'he I
certi fication oT Annual Return of Listed Compal~ywas a1ready 1t1ie1-ein the old Act. Apart from that we had 383A which PI-ovicle I
f.01-Secretal-ial Compliance Report for companies having paid L I ~
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c;q~italof 11s. I0 Lalths or more but less than 5 cr which act~lallyis
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(lisl,cnsed villi L I I I ~ ~ I .new Act and accordingly more [han 93 I I

5. ~,cl.ci.~itof companies have been kept outside the purview 01' any
intlependent review, monitoring, audit or certification relating to
col-po~.atecolnpliance by governance professional like Conil~any
Sccl.cl~11.ies.
Based o n above Facts we wish to have Ministry of Corporate Affairs Lo
loolc in to l-~~lesof Companies Act 2013 and please do the need ~ L I Ias
Ibl lows ant1 1.cquested to safeguard the interest of the stakel~oldersThe
/I I I111o1.i.vcdC~ll~irnlLi17zit should be reduced to 5 Cr und l'rivcrlc
1 cou~v/~cl/,uniestvhich are at least subject to internal Audil I
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/)) P~.ecer.r!'ficationof all eforvlzs should be restored
r n r n / . ~ ~ ~ ~ies rnl,~.slhe included in the ambit of Section 203
(.I/ 7'/1e Secrelnuial Audit Must be made applicable lo rhose
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.4nnuol Relurn ofthe Companies having 5 Cr or more should
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1)emn~~c/n/ori/yccertiJied by the PCS.
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LVc ~,hcMen1bcrs as per the attached names have made our submission
i1 to yatl with high hopes. We understand and appreciate that you are 1
ccl~~allyco11ce1.1ledon the matter and as a well wislier of the Profession
ol' Cornl~a~~ySecretaries we are very hopeful that you will meet our just
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tlc~nantlscxplail~edto you in person as well. To strengthen our case on1
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;I I I cllcsc poi~ltswe are attaching this representation to once again siress I
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6. 011 ( U I I . pail1 a~iclaiguish over the recently notified rules and as a pa~~lne~.
lo MCA in all Lliese years for success of MCA 21 we surely deserve a
I3cllcl' clcaI.
+ L,'c li:l/c vc1.y high hopes Irom the young and dynamic leacler liltr you
I and wc are s~trethat you will not let us down Sir.
,-7
I Iianl<i11%yo~iin alilicipation.
Youl-5 I:aill~I-LII~Y,
CS I<A.IIV 13A.lA.1-9511453353
I-IA[<MA- 9990694230
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I. i s ~o1' Iialnes el~closed.Contributed online by E form.- P
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