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Private Limited Company Compliance

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Introduction

Private limited companies comes with several advantages like simple registration process, limited liabilities, attracts venture capitalist etc. which in churn makes it one of the most preferred and common business entity and attracts many entrepreneurs to register their business.

Like any other type of business entity, private limited companies are also required to maintain and file compliance. As per guidelines, these companies are not allowed to forget to comply with these compliance regulations. Any failure or delay in this will lead to heavy penalties. As per one of the MCA’s report due to non-filing of the compliances, almost 2 lakh companies that got stuck-off and almost 3 lakh directors got disqualified.

What is RoC compliance?

According to Section 609 of Companies Act, Registrar of Companies (RoC) is an authority under Ministry of Corporate Affairs, which looks into the administration of the Companies Act, 2013. The sole objective of the ROCs is to ensure every company registered under Companies Act is complying with the statutory requirements mentioned in the Act.

The guidelines mentioned in the Companies Act, 2013 which every company registered under Companies Act, 2013 have to fulfil annually are termed as ROC compliances. All the companies are required to present their annual details, including the financial statements or loan details, shareholder and director details, etc. by filing the prescribed forms.

Latest update as on 20h March 2020

By keeping in mind the crises caused by COVID -19, MCA have announced certain amendments for the filing of annual returns. These are -

  • Exemption for conducting physical Board Meetings until 30th June 2020, for matters like approval of financial statements, Board report, restructuring, etc.
  • Companies and LLPs are advised to implement ‘Work from Home’ policy till the 31st of March 2020.
  • Web form CAR 2020 is required to submit by authorised signatory of every company starting from the 23rd of March 2020 on the MCA website.

RoC Annual compliance

Mentioned below are the compliances needed to followed by Private Limited Company –

E-form ACTIVE or e-form INC – 22A

MANDATORY COMPLIANCES

Auditor Appointment - E-form ADT-1

Within 30 days of incorporation in first board meeting, first Statutory Auditor must decreed.

For 5 years, Subsequent auditors will be appointed in AGM.

Form ADT-1 is filed for a 5-year appointment. ADT-1 filing is not required after this, however, shareholder countersign the Auditor yearly in AGM.

Board Meeting

First meeting should be held within 30 days of incorporation with a minimum of 2 meetings, once every 6 months.

At least 90 days of interval is required between 2 meetings (ignore if more than 2 meetings held during the year)

Annual General Meeting(AGM)

1 AGM

At most 15 months of interval between 2 AGMs

E-form: MGT-7

Annual Return should be filed within 60 days of holding of AGM for the period 1st April to 31st March.

 

E-form: AOC-4 

File Financial Statement: i.e Balance Sheet along with Statement of Profit and Loss Account and Directors’ Report

 

Form MBP- 1

All the directors are required to disclose their interest in other entities

Required to file at the time when there is change in his interest

Form DIR – 8

All directors are required to file a disclosure of non-disqualification

 

Form DPT – 3

In this form, company has to provide is a receipt of loan or money taken by the company if any

 

 

Directors’ Report

This report must cover the information required for Small Company as per Section 134.

Should be signed by the “Chairperson” of the company

Statutory registers , Minutes Book and books of accounts

Board Meeting Minutes Book

General Meeting Minutes Book includes AGM, EGM, Creditors Meetings, Debenture holders Meetings etc.

Books of Accounts/Financial Statements as per section 44aa

 






ACTIVE (Active Company Tagging Identities and Verification) is a new compliance update from MCA. The filing of this mandatory for all the companies which are incorporated on or before 31st December 2017.

With circular No. 11 dated 24th March, 2020, if any company have missed the filing of this form, then they can do the filing on or before 30th September, 2020 without any penalty.

DIN 3 KYC 

DIN is a unique identification number given to the applicant who wants to be a director or an existing director of a company.

However, now with the new updates all directors with a DIN will have to submit their KYC details annually in eForm DIR-3 KYC. This is required to be done annually.

With the circular No. 11 dated 24th March, 2020, the directors who have missed the filing of this form, then they can do the filing on or before 30th September, 2020 without any penalty.

What are the due dates of the form submitted for Annual Returns?

ROC Forms

Due Date

E-form ACTIVE (INC-22A)

On or before 30th September, 2020

DIN 3KYC

On or before 30th September, 2020

Annual DPT 3

On or before 30th April 2020

Annual Filing AOC 4

On or before 30th April 2020

MSME 1 (2nd half)

On or before 30th October 2020

Annual Return MGT 7

On or before 29th November 2020

Non RoC Compliances

  • MSME 1
  • MSME 2
  • Monthly/Quarterly GST Returns
  • Quarterly TDS Returns
  • Assessment of advance tax liability and payment of advance tax periodically
  • Filing of Income Tax Returns
  • Filing of Tax Audit Report

Non- Compliance Consequences

If a company fails to file and fulfil the compliances mentioned in Companies Act 2013 by any chance, then the company will result in punishable offence with fines associated with that particular compliance. These penalties increases day by day from the due dates.

This can even lead to the stuck off of the company and directors disqualification. Any failure or delay in this will lead to heavy penalties. As per one of the MCA’s report due to non-filing of the compliances, almost 2 lakh companies that got stuck-off and almost 3 lakh directors got disqualified.

Expert’s word

Registering a private limited company is quite easy, by from the above discussion it’s very clear that one have to maintain and fulfil the requirements as by MCA under Companies Act 2013.

If you are running a private limited company, it’s very important to follow the guidelines set by authorities. These compliances are needed to be done on annual basis. It’s not only about the filling but it also about the correct filing of the form within due date.

Corpseed advice you that it’s better to avoid the last minute filing of the forms, as many times MCA portal also not works due to heavy traffic. Our experts will help you in the filing of all the forms days in advance.

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Author
Shamshad Alam
Experienced Digital Marketer with a demonstrated history of working in the internet industry. He likes to write about the latest technology trends, Skilled in Digital Marketing likes. Search Engine Optimization, SMO, SEM, PPC, Content Writing, and, Designing, etc.