AHMEDABAD MANAGEMENT ASSOCIATION 29-08-2019

Manish S Buchasia PCS IP-IBC RV NCLT
AMA Ahmedabad 29-08-2019 1

Manish Santosh Buchasia
Practising Company Secretary (PCS)
Insolvency Professional (IP)
NCLT Consultant
Registered Valuer (SFA)
AMA Ahmedabad 29-08-2019

Company Law Compliance
Company Law Compliance
Company Act 2013, Rule, Notification, Circular,
Guidance Note, Various Standard of 3
Professional Institutes, Allied Act (SEBI BSE
NSE NSDL CDSL Competition Act, FEMA Etc.)
Abide by the Law /
rule
Follow the Procedure
Follow all the above law / rule ,wherever applicable
Company Law Compliance is just like other commercial laws like
Income tax law , GST Law , Labor Law etc , Among all the law of
Indian Corporate world, Co Law is the oldest and Biggest Law .
7Manish S Buchasia PCS IP-IBC RV NCLT

Companies Act 2013
As Per MCA Data as on 30-06-2019 ,Approx there are 19 Lacs Company
Registered , 7 Lacs Closed/ Strike off/ Dormant / Liquidation / Amalgamated/
Status , So 12 Lacs Active Companies are there (11 Lacs Pvt and 1 lac
Public).Gujarat stands 4th in the total no of companies, there are 1 lac active
Companies in Gujarat.
Sections 470 (In 1956 =658) Notified 98 Section on
12-09-2013 ,(184 sections) 01-04-2014 and
going on…
Rules /Chapters /Schedules 42 /29/7
ICAI Accounting Standard 32 (1-29 Mandatory) Rest Optional (Accounting
and Valuation Standard)
ICSI Secretarial Standard 10 (1-3 Mandatory) Rest Optional (Secretarial
Procedure)
ICMA Cost Account and Audit * Depends in CETA Code and Turnover 35 Cr to
100 Cr Industry Wise
SEBI Act , Rule and Regulation Applicable only to Listed Company
NB : Today we are going to cover Company law Compliance of mainly
Unlisted Companies.

Parties to the Compliance
Regulator
Consultant
Shareholder
In-house
Compliance Department
Director

Shareholder Vs Director
Shareholders are the real owners of a company
Director is a manager who manages the company
Shareholders can remove a Director but Not vice versa
Shareholders’ approval is required in all major
decisions, like Approval of Financials, Increase in
Authorized Capital, Issue of Shares to other than
existing shareholders, Related Party Transaction etc
for Special Resolution (at least 2/3 Majority) and
Ordinary Resolution (Simple Majority)

Regulator & Its Branches
Ministry of Corporate Affairs (MCA) (CG)
Registrar of
Companies
(ROC) 23
offices,
almost one in
every state
Regional
Director
(RD),7
offices in
India
covering
multiple
states
Official
Liquidator(OL)
every state, 24
offices looks
after winding-
up of affairs of
the Companies
Specialized
Court NCLT
(12 Bench )
NCLAT (1)
Governs
Listed
companies
SEBI BSE
NSE NSDL
CDSL

Income Tax >Company Law
(Approach / Mind Set)
Income Tax Company Law
In India, mindset of people is such that they give less
importance to company law compliance. Everyone
knows about and is worried about Income Tax
compliance but company law compliance is often
neglected. Mostly everyone remembers their PAN but
hardly any Director remembers his DIN
Tax Saving Behaviors Expenditure Behaviors
38 Cr* Pan card Issued
7.5Crore Tax Payers ,so high
knowledge sharing /
awareness
50 Lacs Din issued
hence slow knowledge
sharing / awareness

Types of Companies
Private Limited Company(Minimum 2
Directors& 2 Shareholders)
Public Limited Company (Closely Held or Listed)
( Minimum 3 Directors & 7 shareholders)
Company Limited By Guarantee
One Person Company(1 Director/1
Shareholder)
Producer Company(Agriculture &
Farming)
Section 8 Company (Trust & Charitable
organisation)

Types of Pvt.Ltd.Companies Compliance Wise
Big Company
Any Pvt. Ltd.
Co having Paid
Up Capital of
Rs 50 Lakhs or
More or
Turnover of 2
Crores or More
Small Company
Less than 50
Lakhs or Turnover
is less than 2
Crores Sec 2(85)

2 Board Meetings Instead of 4
Less Certification of Various Forms
Fast Track Merger (Sec 233)
Cash Flow Statement Exempted
Rotation of Auditor Exempted
MGT-9 in Director’s Report
Exemption

Type of Compliances
Mandatory
Annual
Compliances
(Every Year)
Event Based
Compliances

MANDATORY ANNUAL COMPLIANCES
Regular Board Meetings
Account Finalisation
Audit of Accounts from Auditor
Annual General Meeting (AGM)
DIR-3 KYC
Annual Return(AOC-4,MGT-7,ADT-1)

Particulars Form No
Change in Directors or KMP (Appointment ,
Resignation , Removal, Change in
Designation)
DIR-12
Increase in Authorized Share capital SH-7
Increase in Paid up share capital (Issue of
security)
PAS-3
Change in registered office Within City ,
Outside City, Outside State
INC-22,
MGT-14
Change in secured borrowing (Creation,
modification and satisfaction of charge)
CHG-1,
CHG-4
Filing of resolution and agreements MGT-14

Hold first Board
Meeting within 30
days from
incorporation
Open Bank
Account
Injection of
subscription
money in
the Bank
Account
Upon
receipt of
the
subscription
money, the
company
shall issue
share
cerificates
in form SH1
to the first
subscribers
Payment of
stamp duty
on share
certificates

Types of meetings
Board Meeting
At least 4
meetings per
year
Committee of
Director (Audit
Committee,
Nomination and
Remuneration
Committee)
General Meeting
AGM (Must
Every Year
and Gap
Should Not
be More than
15 Month)
Extra
Ordinary
Meeting

Type Board Meeting General Meeting / Annual General Meeting
Notice 7 Days 21 Clear Days Unless AOA Authorise Other
Wise
Place Any Where In World EGM Any Where in India, AGM Within City
Limit
Time Any Hour Working Hour
Day Any Any Except National Holiday 26-1 ,15-08,
02-10
Mode Physical / E-meeting Physical Only Except Where Postal Ballot Is
Permissible
Quorum 1/3 or 2 Higher Min. for Pvt 2, for Public 5 (<1000), 15
(>1000<5000), 30 (>5000) ,
Proxy NA Yes But Not Counted as Quorum
Chairman Among Director only Among Shareholders Only
Voting Show of Hands Poll / Show of Hands and In Some Cases
E-voting is Mandatory
Minutes In 30 Days In 30 Days

AGM Law & Procedures
Types of AGM 1st AGM Rest AGM
Maximum Gap from the End of Financial
year and AGM Date
9 month (30th Dec) 6 month (30th
September)
Maximum Accounting Period 15 Month 12 Month
Example:
For a company incorporated on 1st day of January 2018, the
first financial year shall be closed on 31st day of March 2019
and AGM should be convened on or before 31st day of
December 2019. However for a company incorporated on
31stof December 2017, the first financial year shall be closed
on 31st of March 2018 and AGM should be convened on or
before 31st of December 2018.

There must be one meeting held in each year.(Need not be
First year of Incorporation)
At least 21 clear days’ notice shall be given for every general
meeting.
Meeting shall be within prescribed time 9:00 am to 6:00 pm
It can be held on all days including on Sundays and public
holidays but cannot be held on National Holidays .
It should be conducted at the place within City where the
registered office of the company is situated.
AGM Law & Procedures

AOC-4
• Financial Data ,Balance Sheet, Profit & Loss ,Director
Report ,Auditor Report , Notes to the account
• To be filed within 30days of AGM
MGT-7
• Secretarial Data ,No of Meeting , Attendance Data of
Director / Shareholder , share transfer details etc
• To be filed within 60 days of AGM
ADT-1
• Auditor Appointment / Reappointment , if any
• To be filed within 15 days of AGM
Annual Filing Main Form AOC-4 MGT-7 ADT-1

Specific Annual Filing Applicability
Forms
Forms Applicability
AOC -4 (Financial) and
MGT-7 (Secretarial)
All Companies
AOC-4(XBRL) Instead of
AOC-4
Mandate (1) Listed Co (2) Turnover of 100 Cr (3) Paid up Capital of Rs 5 Cr
(4) Subsidiary of Listed co (5) Any Time XBRL Done
AOC-4(CFS) Addition to
AOC-4 or AOC-4(XBRL)
Having Subsidiary and or Associate Company
MGT-8 Additional Attachment to MGT-7 Practicing Company Certificate (1) Listed
Company (2) paid-up share capital of Rs. 10 Cr or more, (3) Company with a
turnover of Rs. 50 Cr or more
Secretarial Audit (1) Listed Company (2) every public company having a paid-up share capital
of Fifty Cr rupees or more, (3) Every public company having a turnover of
Two Hundred Fifty Cr rupees or more.
ADT-1 Auditor
Appointment and Re-
Appointment , Auditor
Rotation
Specified Company ,
Reappointment up to 5 year at once ,
Limited to maximum of 10 years
Non Specified Company
Unlimited Year Subject to Maximum
of 5 year at once

Register of Members
Attendance Registers for meeting of Board and Committee
Register of Deposits
Register of debenture holders/ other securities holders
Register of Transfer and Transmission of Shares
Register of Shares or Securities bought back
Register of loan, investment and guarantee
Register of Charges
Minute Books of Board of Directors and Committees of the
Board
Mode of Maintenance can either be physical or
electronic but it should be preserved for prescribed no.
of years

MCA FILING FEES STRUCTURE
Nominal / Authorised Share
Capital
Fees per
document
Less than Rs. 100000 Rs. 200
Rs. 100000 to less than Rs.
500000
Rs. 300
Rs. 500000 to less than Rs.
2500000
Rs. 400
Rs. 2500000 or more but less
than Rs. 1 Crore
Rs. 500
Rs. 1 Crore or more Rs. 600

Types of Additional Fees
Additional Fees : 2 Times to 12 Times of
Normal Fees (Major Forms) For Delay more
than 1 Month to 6 months
w.e.f. 01-07-2018 Rs 100 Per Day, Applicable
only to Annual Filing Forms AOC4, MGT7
w.e.f. 01-08-2019 Advalorem fees of 0.025 or 2
Lacs in Pvt Ltd. & 0.05 % upto Rs. 5L in Public
Ltd. Quantum of Penalty depends upon the
value of transaction in case of Charge
Creation/Modification/Satisfaction.

RECENT AMENDMENTS (DONE & DUE)
ACTIVE-
22
• Active Company Tagging Identities and Verification (Company Name Place ,
Director Photo outside and Inside Registered office)
DPT-3
• Return of Deposit (Borrowing Secured & Unsecured ) One Time and Regular
30-06-2019*
BEN-2
• Significant Beneficial Owners (BEN-1) Last Date 30-9-2019
DIR-3
KYC Web
& Form
• E-form and Web based Form for the First Timer any day between 01 -4-2018 to
31-03-2019 , if Change in Email & Mobile No, then KYC Form and if Change in
Address, DIR-6 Last Date 30-9-2019
MSME
• MSME-2nd Half yearly Return Payment outstanding more than 45 days

DIR-3-KYC 2019 Form or Web
(Annual Compliance)
Applicability Forms
New DIN Obtained between 01-04-2018 to 31-03-
2019
DIR-3-KYC E-FORM
DIR-3-KYC 2018 Done and No Change in Email Id ,
Mobile (No Change Case)
DIR-3-KYC WEB OTP
DIR-3-KYC 2018 Done But want to update either
mobile no. or email id (Change Case)
DIR-3-KYC E-FORM
DIR-3-KYC 2018 Done But Change in Address
(Change Case)
DIR-6 and DIR-3-KYC WEB OTP
Not yet Done DIN KYC DIR-3-KYC E-FORM With Rs 5000
Fees
Last Date is 30-09-2019 if not done, Rs 5000 Fees
and Din Deactivated

Consequences of Non-Compliance
Additional Filing Fees
Penalty ( Section Specific) (Applicable to Both Co and
Directors) ( Calculated on Per Day basis)
Prosecution / Jail
Director Disqualification in All other Co
Strike off (S 248) by ROC (3 lakhs in 2017) Then go to NCLT for
Revival (S 252) and /or Prosecution
Company Status-Inactive (unable to file few
forms)

MISCONCEPTION ABOUT
COMPLIANCE
Annual Return Must be Filed Whether
Company is Operative or Not
It is assumed that MCA Filing Fees
Waiver will come in Future , so wait
Once the filing of Income Tax Return is
over , they are confused and assume
that MCA Return is also over

RECONSTRUCTION OR EXIT
OPTION
Conversion of Co to LLP (Less Compliance)
Merger or Amalgamation ( Reconstruction)
Strike Off Application (If not Operating and
Not Working for 2 years )
Voluntary Liquidation & Winding Up (if
NOF is there ,through IBC & NCLT)

HOW TO AVOID HUGE COMPLIANCE COST ?
Conduct Board Meeting Regularly (Quarterly)
Early & Timely Annual Account Finalization & Audit >
Early Annual General Meeting > Timely Annual Filing
Assure Active Email Id , Mobile No & Registered Office
address (DIR-3-KYC or Active-22A ) so Every Alert ,
Reminder, Notices from Consultant / Department will be
timely delivered and proper action can be taken
Immediately (Example 2017 3 lakhs >248)
Keep Active Consultant and Communicate with them
frequently
Subscribe to Various Compliance Portal Services
Regularly Visit MCA Portal to know the Company
Compliance Status
Interact with Consultant

Compliance is not a one-time
thing, but is a continuous affair.
Cost of non compliance is always
more than cost of compliance.

Manish Santosh Buchasia
Practising Company Secretary (PCS)
Insolvency Professional (IP)
NCLT Consultant
Registered Valuer (SFA

AHMEDABAD MANAGEMENT ASSOCIATION 29-08-2019

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