Compliance Under Companies Act 2013 GMJ & Associates

Transcription

1 Compliance Under Companies Act 2013 GMJ & Associates Andheri (East), Mumbai Tel No id : cs@gmj.co.in

2 Speaker: CS Bijal Gada Incorporation Topics to be covered Issue and allotment of Securities Acceptance of Deposits Creation of Charge Maintenance of Various Registers under Companies Act, 2013

3 Types of Companies Companies under Companies Act, 2013 Public Company Private Limited One person Company Section 8

4 Features of Various Companies Private Company minimum paid up share capital of Rs. 1 lakh Who s name ends with the word Private Limited Public Company minimum paid up share capital of Rs. 5 lakhs. Who s name ends with the word Limited OPC Share capital shall not be >Rs. 1 Lakh and shall not < Rs. 50 lakh Who s name ends with the word Private Limited and mention as OPC

5 Features of Various Companies Private Co. Public Co. OPC Minimum:2 members Maximum : 200 Prohibits any invitation to the public to subscribe for any securities of the company Restriction on Transfer of Shares Minimum: 7 members Maximum: No limit No such prohibitions No such restriction Only one member Prohibits any invitation to the public to subscribe for any securities of the company Restriction on Transfer of Shares

6 Formation of Company/Steps for Incorporation of Company Step 1: Obtain Director Identification Number (DIN) and DSC Step 2: Application for reservation of Name of the Company Step 3: Application for Incorporation of Company Step 4: Certificate of Incorporation Step 5: Commencement of Business

7 Step:1 Obtain DIN and DSC What is DIN? 8 digit unique identification number To whom it is allotted? To the applicant Application form for DIN? Form DIR-3 Fees? Rs. 500/-

8 Attachment/Details to Form DIR-3 PAN Card is mandatory (in case of Indian nationals). Passport is mandatory (in case of foreign nationals). Proof of residence (in case of utility bills is shall not be older than 2 Months). Verification in Form DIR-4 duly attested by authorised person. Scanned copy of latest passport size photograph. A person applying for DIN shall have DSC. Applicant s mobile no., id, qualification and Occupation.

9 Step the Company 2: Application for reservation of Name of Company Form for Application: Form INC-1 Filing Fees:- Rs. 1000/- Resolution/NOC: For using of prefix word of the existing name applicant needs to obtain NOC from the existing holder of the name.

10 Step the Company 2: Application for reservation of Name Things to take care while applying name: The applicant need to take care that the proposed name shall not be identical with the name of an existing company registered under the Act and Name undesirable in the opinion of the Central Government. Letter of Approval of Name: Reserved name once approved will have validity of 60 days.

11 Company Step 3: Application for Incorporation Documents to filed with the ROC within 60 days of the reservation of the name: File Form INC-7 (with supporting documents) (in case of OPC File Form INC- 2) File Form DIR-12 (particulars of Directors) File Form INC-22 (particulars of the registered office address of the Company, if the registered office address is permanent)

12 Documents required to be filed with Form INC-7 Memorandum (MOA) and Articles of Association (AOA). Form INC-8 Affidavit in Form INC-9 Form INC-10 Filing Fees and Stamp Duty: As per Authorized share capital

13 Documents required to be filed with Form INC-2 (For OPC) MOA and AOA PAN copy and residential proof of the member and the nominee Consent of the nominee in Form INC-3 (nominee shall be Indian nationals and natural person) Affidavit in Form INC-9 Form INC-10 Proof that the company is permitted to use the address of the registered

14 Documents required to be filed with Form DIR-12 (not required in case of OPC) Particulars of First Directors as mentioned in Articles of Association along with Proof of Identity and Residential proof. Particulars of the interest of persons mentioned in Articles as First Directors of the company in other firms or body corporate in Form MBP-1 Consent of the Director in Form DIR-2

15 Documents required to be filed with Form INC-22 From 15 th day of Incorporation shall have Regd office File form within 30 days of incorporation. No need to file again if already filed with INC-7 Attachments Any utility bills (Not Older than 2 Months) The authorization from the owner or authorized occupant of the premises along with proof of ownership. Notarized copy of lease or rent agreement in the name of the company Rent receipt not older than 1 month The registered document of the title of the premises of the registered office in the name of the company

16 Step 4: Certificate of Incorporation Registrar of Companies on receipt of INC-7, DIR-12 and INC-22 Issue of Certificate of Incorporation In Form INC- 11.

17 Step 4: Certificate of Incorporation Certificate of Incorporation will carry Name of the Company Date of the Incorporation CIN: 21digit unique number allotted to the Company Format of CIN: U MH 2007 PTC unlisted Indust State year Pvt co rial code Registrat ion number

18 Step 5: Commencement of Business Form INC-21 to be filed within 180 days of incorporation to commence business. Attachment Details of shareholders along with shareholding Details of Directors Board Resolution Form INC-10 Certified copy of the Bank statement showing subscribed amount INC-22 has been filed

19 Penalty for contravention Breach of Law: false or incorrect particulars following shall be punishable: the first Director and the person making declaration for incorporation. Imprisonment: Minimum: 6 months may extend to 10 Years;and Fine: Minimum :amount involved in the fraud, Maximum: three times the amount involved in the fraud

20 Allotment of Securities Types of Allotment Private Placement Any offer of securities or invitation to subscribe to securities to 200 persons or less (excluding qualified institutional buyers and employees) in a financial year is a private placement under section 42(2) of the Companies Act Preferential allotment Preferential Allotment is the process by which allotment of securities/shares is done on a preferential basis to a select group of investors.

21 Allotment of Securities Right offer: Right issue is directly offered to all existing shareholders of the company in proportion to their current holding.

22 Private Placement and Right issue Private Placement Right Issue Special Resolutio n Allottees Approval of Shareholders shall be taken for allotment of shares on private placement basis. Shares offer to selected group of person through offer letter (PAS-4) Board resolution shall be required for issue and allotment of shares. Shares offered to existing shareholders of the Company on a pro rata basis through offer letter, no offer letter is prescribed.

23 Private Placement and Right issue Maximum number of allottees to whom securities can be offer Size of Investment Private Placement is 200 person in a year Minimum Rs. 20,000 of face value of securities Right Issue Shares issued to existing shareholders and hence there is no limit. No such conditions

24 Filing and Records requirements Filing and Records Requirements Private placement/preferential allotment : Filing Form MGT-14 -within 30 days of the passing of resolution CTC of the resolution passed in the General Meeting, Notice of the general meeting along with the explanatory statement along with Valuation Report, Shorter consent in case general meeting held at shorter notice. Filing of Form GNL-2-within 30 days of the circulation of letter of offer PAS-4 letter of offer PAS-5 Complete record of private placement offer.

25 Filing and Records requirements Filing and Records Requirements Right Offer/Private Placement/Preferential allotment Filing of MGT-14 -within 30 days of Board Resolution passed for issue of shares CTC of the Board Resolution for issue of shares Filing of PAS-3 -within 30 days of allotment of Securities List of Allottees CTC of the Board Resolution for allotment Valuation Report PAS-5 in case of private placement

26 Penal provision : offer or accept monies in contravention, the Company, its promoter and Directors will be liable Penalty amount involved in the offer or an invitation or Rs. two crore whichever is higher The Company shall also refund all monies to subscribers within a period of thirty days of the order of imposing penalty.

27 Acceptance of Deposits by Company: Definition of Deposits : Deposits includes any receipt of money by way of deposits or loan in any other form by a Company, but does not include such categories of amounts as may be prescribed in consultations with the Reserve Bank of India. Following classes of the Companies shall be excluded: Banking Companies NBFCs Housing Financial Companies Companies specified by the Central Government

28 Deposit does not includes: Amount received from promoter as a part of loan agreement from Banks; Share Application money or advance money received towards allotment kept in a separate account for 60 days. Amount received from Directors of the Company. Any amount received from an employee of the Company and Any amount raised by the issue of bonds or debentures

29 Deposit does not includes: loan taken from the financial institution which are notified by the Central Government; Any amount received against issue of commercial papers or any other instruments which are issued in accordance with the law; Any non interest bearing amount received or held in trust; Any amount received as advance or security deposit as per the Contract or agreement in the normal course of business

30 Filing of Documents with the ROC: File DPT-4 In respect of any deposit accepted before the commencement of CA 2013, Form DPT-4 was required to be filed by June 30, 2014 (extended to 30 th August, 2014) with the ROC. Attachment of Form DPT-4 a statement of all the deposits accepted and sums remaining unpaid with the interest payable thereon; the arrangements made for such repayment and Auditors certificate for outstanding amount of deposits.

31 Repayment of existing deposits: Repay within one year from commencement of the Act or from the date on which payment are due, whichever is earlier

32 Together with the instruments creating the charge Charge A company creating a charge, shall, register the particulars of the said charge with the ROC within 30 days of its creation. This charge could be: a. on its property or assets or b. any of its undertakings c. whether tangible or otherwise Situated in or outside India Signed by both the Company and the charge-holder

33 Form CHG-1 & Form CHG-9 Creating/modifying the charge shall be filled in Form No.CHG-1 (for other than Debentures) or Form No.CHG-9 (for debentures) Attachments: Copy of the Instrument of creation or modification, Resolution for borrowings (Check whether borrowings of the company are within the limits prescribed).

34 Form CHG-1 & Form CHG-9 Check in the agreement : Rate of Interest Terms of repayment Margin Extent and operation of charge Others terms and conditions.

35 Condonation of Delay By Registrar The Registrar may, allow the registration of the charges after 30 days but within a period of 300 days of the date of such creation of charge or modification of charge. After 300 days, the application for the Condonation of delay shall be filed with the Central Government in Form CHG-8. The order passed by the Central Government is required to filed with the Registrar in Form No. INC-28.

36 Certificate of registration: Where a charge is registered with the Registrar, the ROC shall issue a certificate of registration of such charge in Form No.CHG-2. Where the particulars of modification of charge, the Registrar shall issue a certificate of modification of charge in Form No. CHG-3.

37 Satisfaction of Charges A company shall within a period of thirty days from the date of the payment or satisfaction in full of any charge registered, give intimation of the same to the Registrar in Form No.CHG-4. Registrar shall issue shall issue a certificate of registration of satisfaction of charge in Form No.CHG-5.

38 Statutory Registers Register of members (MGT 1). Register of debenture holders (MGT 2). Foreign Register of members. Register of charges (CHG-7). Register of contracts, arrangement in which Directors are interested (MBP 4). Register of Deposits (Particulars to be entered as prescribed). Register of Directors, Key Managerial Personnel.

39 Statutory Registers Register of Employee Stock Options (Form SH 6). Register of Investment not held by the Companies in its Own Name Form (MBP 3). Register of Loans, Investments, Guarantee and Securities MBP-1. Register of Renewed and Duplicate Share Certificates. Register of securities/shares Bought back.

40 Speaker: CS Trusha Parikh Topics to be covered Appointment of Auditor Appointment of Directors E-Voting Filling of Annual return, Balance Sheet and Profit & Loss List of Resolution which need to file with ROC

41 Appointment of Auditors Process of Appointment of First Auditors For Companies other than Govt. Companies Board to appoint first auditors in first Board Meeting within 30 days from Company Incorp. If above not done, members to appoint 1 st auditors within 90 days at EGM valid till 1 st AGM

42 Auditors Rotation Applicable to which companies? All Listed Companies Unlisted Public Companies with paid up capital > Rs. 10 Crores Private companies with paid up capital > Rs. 20 crores. All companies with o/s loans / deposits > Rs. 50 crores Auditor rotation not applicable to OPC & small companies

43 Auditor Auditor Rotation Rotation Concept & Process of Auditor Rotation Individual cannot be auditor for continuous period of more than 5 years. Audit Firm cannot be auditor for continuous period of more than 2 terms of 5 years. Cooling period of 5 years after above tenure. Provisions regarding rotation are to be applied retrospectively however, 3 years time to give effect to provisions of auditor rotation.

44 Auditor Rotation Type of Auditor No. of years of consecutive audit (in 1 st AGM to be held in Sep 2014) Maximum consecutive years for which appt. can be made Individual 5 3 Individual 1 4 Firm 10 3 Firm 6 4 Firm 1 9

45 Certain Services which cannot be rendered by an Auditor Accounting and Book Keeping Services. Internal Audit. Design and Implementation of Any Financial Information System. Actuarial Services. Investment Advisory Services. Investment Banking Services. Rendering of Outsourced Financial Services. Management Services. Any other kind of services as may be prescribed in rule.

46 Vacation of Auditor Casual Vacancy Removal By Tribunal Removal of Auditors Resignation By Auditors Non-reappointment

47 Forms Appointment Form ADT-1 need to file within 15 days of GM with the following attachment: Copy of the Intimation Sent by Company Copy of Written Consent Given by Auditor Copy of resolution passed by the Company Resignation Form ADT-3 need to file within 30 days from date of resignation with the following attachment:: Resignation letter

48 Directors & Key Managerial Personnel New Concept of Directors under CA 2013 Woman Director Key Managerial Personnel Independent Directors

49 Criteria: Woman Director Every listed company Every other public company that has paid up share capital of Rs. 100 crore or more, or A turnover of Rs. 300 crore or more. Cooling period: CA 2013 CA 1956 within 6 months from date of incorporation within a period of 1 year from the commencement of the ACT.

50 Independent Directors Every listed public company to have at least one-third of the total number of directors as independent directors. Public companies having up share capital of paid Rs. 10 crore or more; or Public companies having turnover of Rs. 100 crore or more. Public companies which have, in aggregate, outstanding loans or borrowings or debentures or deposits, exceeding Rs. 50 crore.

51 Who is an Independent Director? A person of integrity, relevant expertise and experience; He is not a promoter or related to the promoter or director of the company or its holding, subsidiary or associate company; He should not have pecuniary relationship with the company. Who, neither himself nor any of his relatives holds or has held the position of a KMP or employee of the company or its holding, subsidiary or associate company in any 3 FY when he is appointed. hold together with his relative 2 % or more of the total voting power of the Co. Who possess such other qualifications as may prescribe in rule.

52 Key Managerial Personnel Who are KMPs? A Managing Director / CEO/ Manager and incase of absence of any of these 3 personnel the Whole time Director and Company Secretary and Chief Financial officer Applicability KMP Shall hold office only in 1 Company.

53 Appointment of Directors (Cont..) Form DIR-12 needs to be filed within 30 days of passing of the Board Resolution with the following attachment: Woman Director -Consent (DIR-2) -Proof of Identity -Proof of Address -MBP-1 - Board Resolution Independent Directors -Consent (DIR-2) -Proof of Identity -Proof of Address -Letter of Appointment -Declaration of Independence -MBP-1 -Board Resolution Key Managerial Personnel -Consent Letter -Board Resolution MGT- 14 MR-1

54 E-voting Green Initiative by MCA Which Company need to provide E voting Facility When E-voting facility can be availed? Procedure of E-Voting - Appointment of E-voting Agency - Appointment of Scrutinizer - Dispatch Notice to Shareholder - Advertisement in NEWSPAPER

55 How E-Voting work The Company desiring to use e-voting system has to avail services of any one of the following agencies: 1 KARVY 2 CDSL 3 NSDL b) The agency will issue User- id s and passwords having the maker, checker and scrutinizer privileges. c) The Company itself or through its Registrar and Transfer Agent [RTA] will setup the e - Voting schedule on the e - Voting website, upload the resolutions on which voting is required

56 How E-Voting work d) The Company/ RTA can then upload the Register of Members (ROM). e) Agency will then generate the password for security holders and forward the same to the Company. f) The Company will then communicate the password, EVSN and the procedure for e-voting, along with the notice of the resolution to all the security holders. g) The security holders should log on to website of agency during the duration of the e-voting and cast their votes for all the resolutions.

57 How E-Voting work Scrutinizer Report Form Form GNL-2 need to be filed within 30 days of AGM with the following attachment: Form MGT-15 Scrutinizer Report

58 Extract of the Annual Return to be attach with Board Report in Form MGT-9. Filling of Annual Return and Balance sheet etc ANNUAL RETURN Every Company shall prepare its Annual Return in Form MGT-7 Particular of AR shall as on close of FY i.e. March 31 And to be filed within 60 days from date of AGM with ROC

59 Signing & Certification of ANNUAL RETURN In case of Company other than small Company and OPC annual return need to be SIGNED by: Director and Company Secretary in the whole time employment of the company. Where NO Company Secretary, by PCS In Case of Listed Company and Companies having paid up capital Rs. 10 Crores or more OR turnover of Rs. 50 Crores or more CERTIFICATE from PCS in Form MGT-8 needs to be attached.

60 Particular of Annual Return a) Its registered office, principal business activities, particulars of its holding, subsidiary and associate companies. (b) Its shares, debentures and other securities and shareholding pattern. (c) Its indebtedness. (d) Its members and debenture-holders. (e)meetings of members or a class thereof, Board and its various committees along with attendance details. (f) Remuneration of directors and key managerial personnel.

61 Particular of Annual Return (Cont ) (g) Penalty or punishment imposed on the company, its directors or officers and details of compounding of offences and appeals made against such penalty or punishment. (h) In respect of shares held by or on behalf of the Foreign Institutional Investors indicating their names, addresses, countries of incorporation, registration and percentage of shareholding held by them. (i) Matters Related to Certification of Compliances and (j) Such other matters as may be prescribed in the (Form MGT-7)

62 Filling of Annual Return and Balance sheet etc. Filling Balance Sheet & Profit & Loss Financial Statements, Auditor Report and Board Report of Companies whose financial year commenced before 1 April, 2014 need to file the report according to provision of the Companies Act 1956 i.e. Form 23AC Form 23 ACA New Form as per NEW CA 2013 are: Form AOC-3 & Form AOC -4 Forms are still not notified

63 Penalty for Non Compliance Penalty for non compliance By Company Fine not less than Rs. Fifty Thousand but which may extend to Rs. Five lakh. By Officers in default Imprisonment for a term which may extend to six months or Fine not less than Rs. Fifty Thousand but which may extend to Rs. Five lakh or Both By Company Secretary in Practice Fine not less than Rs. Fifty Thousand but which may extend to Rs. Five lakh.

64 Board Resolutions to be filed with ROC To make calls on shareholders in respect of money unpaid on their shares. To authorise buy-back of securities under section 68. To issue securities, including debentures, whether in or outside India. To borrow monies. To invest the funds of the company. To grant loans or give guarantee or provide security in respect of loans. To approve financial statement and the Board s report. To diversify the business of the Company.

65 Board Resolutions to be filed with ROC To approve amalgamation, merger or reconstruction. To take over a company or acquire a controlling or substantial stake in another company. To make political contributions. To appoint or remove Key Managerial Personnel (KMP). To take note of appointment(s) or removal(s) of one level below the Key Management Personnel.

66 Board Resolutions to be filed with ROC (Cont ) To appoint internal auditors and secretarial auditor. To take note of the disclosure of director s interest and shareholding. To buy, sell investments held by the company constituting five percent or more of the paid up share capital and free reserves of the investee company. To invite or accept or renew public deposits and related matters. To approve quarterly, half yearly and annual financial statements or financial results as the case may be. Form MGT-14 need to file within 30 days from date of passing resolution with the CTC of Board Resolution.

67 Information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of particular situation.