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  • Overview
  • Documents
  • Process
  • Benefits
  • Unlisted
  • Listed
  • Compliance
  • OPC Compliances Benefits
  • OPC Compliance Process
  • Overview
  • Documents For LLP Compliance
  • LLP Compliance Benefits
  • LLP Compliances
  • Pvt Ltd Compliance Documents
  • Pvt Ltd Compliance Process
  • Pvt Ltd Compliances Benefits
  • Pvt Ltd Compliances

Annual Compliances in One-Person Company - Overview

Annual compliances for One Person Companies involve following steps:

  • Organising Board Meetings and Annual General Meetings: With accordance to the Section 173 of the Companies Act, 2013, an OPC must conduct at least one board meeting every six months. The duration between two meetings must not be less than 90 days.  An OPC should organize two board meetings annually. Addition to board meetings, OPC is required to organize one Annual General Meeting or AGM. A company failing to comply with these requirements is fined for Rupees 25,000, and the officer in default can be penalized Rs 5,000.
  • Appointment of Auditor: Appointing an auditor via FORM ADT-1 is required for an (OPC) One Person Company under Section 139 of the Companies Act 2013. The company should arrange an audit of its accounts by a Chartered Accountant firm. The auditor will verify the books of account and release an Audit report.
  • Filing Annual Return: Every OPC should file the Annual Return within 180 days from the end of the Financial Year. The details of the Annual Return must include information about the company’s member/shareholder and directors. Form MGT-7 is submitted for filing the Annual Return.
  • Financial Statement: The company should mandatorily file the details of financial statements like statement of Profit and Loss, Balance Sheet and Director Report. Financial statement is filed using Form AOC-4 , and it should be submitted within 180 days from the end of the financial year.
  • Disclosure of Interest: In every financial year, the directors of the OPC, in the first Board meeting, are required to disclose their interest in other entities using form MBP-1. The Director who defaults may face jail term of 1 year.
  • KYC of the Director: Every individual holding DIN as of March 31st of the financial year is required to fulfill KYC obligations via submitting Form DIR-3-KYC for the current financial year on or before 30th September of the upcoming financial year.
  • Filing Form DPT-3: Form DPT-3 is to be filed each year on or before 30th of June with respect to the return of Deposit and particulars not considered Deposits as on March 31st.
  • Preparing the Statutory Register: According to  Section 88 of the Companies Act, 2013, One Person Companies must also maintain statutory registers. There are also certain event-based compliances that must be fulfilled by OPCs like transfer of shares, appointment or resignation of directors, change in nominee or bank signatories and change in auditors.

Documents Required for the Annual Compliance of Public Limited Company

Many documents are required to be filed for annual compliance of a Public Limited Company. These are:

  • Sales and purchase bills of expenses during the year.
  • Details of Bank Statements, to be fetched from 1st April to 31st March of all bank accounts of the Company.
  • Details of GST returns filed.
  • Details of both TDS Returns and TDS Challans. 
  • Details of Balance sheet
  • Details of Profit & Loss Account.
  • Copy of Financial statements.
  • Copy of Directors report.
  • Details of the Member.
  • Details of Directors. 

Consequences of Non Compliance of Public Limited Company

Non-compliance with Public Limited Company compliance requirements can lead to various consequences for Public Limited Company including monetary penalties, financial losses, and damage to the reputation of the Public Limited Company. Some of the key consequences of non-compliance are:

  • Huge Penalties: Non-compliance of compliance requirements can lead to penalties being levied upon public companies by regulatory authorities such as the SEBI, NSE or BSE Stock exchanges, Ministry of Corporate Affairs (MCA), GST Officials or the Reserve Bank of India (RBI). 
  • Legal Proceedings: Constant failure to comply with compliance norms can lead to legal action being taken against the public company either filed by shareholders, creditors, or regulatory bodies. This can lead to expensive court cases and a burden on a company's resources. 
  • Loss of Market Cap and Goodwill: Non-compliance can harm the public company's reputation as many companies are listed on stock exchanges. News may come out of non compliance which can pull share prices down. This may lead to loss of goodwill in the market, erosion of market cap apart from financial losses and leading to a loss of trust among shareholders. 
  • Financial Loss: Non-compliance can lead to financial losses due to various fines, falling stock prices, court cases, legal fees etc.
  • Disqualification of Directors: Non compliance can lead to disqualification of Directors of a company. This may impact the overall operations and governance of the company.
  • Revocation of License: In rare cases of non compliance, ROC may revoke the company's license or registration.
  • Share Market Regulations: SEBI may stop the trading of public companies, delist the company, put ASM status or can cancel the registration of listed public companies engaged in share trading if it violates directions issued by SEBI.
  • Restrictions on Operations: Non-compliance may lead to restrictions on the company's operations, starting new business, limitations on raising funds, entering into contracts, shifting the business etc. 
  • Default Status: Non-compliance in cases of mandatory financial reporting requirements or debt obligations can lead to the company being classified as a defaulter, which can have serious complications on its public image, ability to raise funds or access funding in the future.
  • Dissolution: In extreme cases of non-compliance or constant failure to meet regulatory obligations, the company may face dissolution or winding-up proceedings either started by the authorities or its creditors.

Online Process for Public Limited Company Compliance 

All forms needed for public limited company compliance like CRA-2, DPT-3 can be submitted online via this process:

  • Visit the MCA portal
  • Open and download the e-form required
  • Fill up details in the form
  • Upon completion click on the link  “Upload e-form”
  • Upload your filled e-form
  • After you have successfully uploaded the form, navigate to the fee payment gateway
  • Pay the required fee online

Benefits of Public Limited Company Compliance

Compliance with regulatory requirements by public limited companies offers several benefits, both tangible and intangible, contributing to their long-term sustainability, credibility, and growth. Here are some key benefits:

  • Enhanced Corporate Governance: Compliance fosters strong corporate governance practices, ensuring transparency, accountability, and fairness in decision-making processes. By adhering to regulatory standards, public limited companies establish clear lines of authority, mitigate conflicts of interest, and uphold ethical business conduct, thereby enhancing investor confidence and trust.
  • Access to Capital Markets: Compliance with listing requirements enables public limited companies to access capital markets for raising funds through equity offerings. Listed companies enjoy greater visibility, liquidity, and investor interest, facilitating capital-raising activities for expansion, innovation, and strategic initiatives. Compliance with disclosure norms and transparency requirements enhances investor perception and attractiveness of the company's securities in the capital markets.
  • Stakeholder Confidence: Compliance instills confidence among stakeholders, including shareholders, creditors, customers, and employees, regarding the company's financial stability, operational efficiency, and adherence to legal and regulatory standards. Transparent reporting, timely disclosures, and adherence to corporate governance principles reinforce stakeholders' trust in the company's management and governance practices, fostering long-term relationships and support.
  • Risk Mitigation: Compliance practices help identify, assess, and mitigate various risks, including legal, financial, operational, and reputational risks. By adhering to regulatory requirements, public limited companies minimize the likelihood of non-compliance penalties, litigation, regulatory sanctions, and damage to their reputation. Robust compliance frameworks enable proactive risk management, ensuring business continuity and resilience in dynamic operating environments.
  • Legal Protection: Compliance with applicable laws and regulations provides legal protection to public limited companies, shielding them from regulatory violations, lawsuits, and enforcement actions. By operating within the bounds of the law, companies minimize legal liabilities, protect shareholder interests, and uphold corporate integrity. Compliance also enhances the company's ability to defend against legal challenges and regulatory scrutiny, safeguarding its reputation and goodwill.
  • Competitive Advantage: Compliance fosters a culture of professionalism, integrity, and excellence within public limited companies, distinguishing them from competitors in the marketplace. Companies that prioritize compliance demonstrate their commitment to ethical business practices, quality standards, and regulatory adherence, positioning themselves as trusted partners and industry leaders. Compliance-driven companies may also gain a competitive edge in procurement processes, partnership opportunities, and customer relationships.
  • Investor Attraction and Valuation: Compliance with regulatory requirements enhances the company's attractiveness to potential investors, analysts, and stakeholders, influencing its valuation and market perception. Investors often prioritize companies with strong governance structures, transparent reporting, and demonstrated compliance track records, viewing them as lower-risk investment opportunities. Compliance-driven companies may command higher valuations, lower capital costs, and greater investor interest, facilitating capital formation and business expansion.
  • Operational Efficiency: Compliance frameworks promote operational efficiency, standardization, and best practices within public limited companies. By streamlining processes, enhancing controls, and optimizing resource allocation, companies can minimize regulatory burdens, reduce compliance costs, and improve overall business performance. Compliance-driven initiatives such as automation, digitization, and risk-based approaches enable companies to focus on strategic priorities and value-added activities, driving productivity and innovation.

Annual compliances of Unlisted Public Limited Company

Now we shall discuss annual compliance of unlisted public companies

  • Board Meetings: As per section 173 of the Companies Act 2013, Public limited companies are required to conduct board meetings at regular intervals, with a minimum of four board meetings per year. These meetings play a crucial role in decision-making, oversight of company affairs, and compliance with statutory requirements. Key matters such as financial performance, corporate strategy, risk management, and regulatory compliance, are discussed in board meetings. Discussions related to appointment or reappointment of auditor are also taken in board meetings. 
  • Appointment of Cost Auditor: Appointment of Cost auditor via Form CRA-2 is compulsory for an unlisted public limited company under Section 148(3) of the Companies Act. ROC needs to be intimated regarding auditors appointment. As per the Companies Act, the appointment of the cost auditor is done by the Board of Directors within 30 days of the date of board meeting or within 180 days in the financial year, whichever comes first. 
  • Return of Deposit: As per rule 16 of Companies Rule 2014, the Form DPT-3 must be filed before the ROC, every year on or before June 30th concerning return of Deposits and particulars.
  • Annual General Meetings: Unlisted Public companies too are needed to conduct one AGM each year according to Section 96 of Companies act 2013. Dividend for shareholders is declared in AGM.
  • Appointing CFO/CO/CS: According to Section read with rule 8 and 8A of companies rules 2014,a full time or casual CFO/CO/CS needs to be appointed in unlisted public companies within thirty days of AGM, via form MGT-14 and DIR-12. 
  • Special Resolutions: Some special resolutions are passed in AGMs under Section 117 of the Companies Act 2013, read with rule 24 of companies rules 2014. 
  • Director’s Disclosure: Directors need to disclose their interest in the company via Form MBP-1 according to Section 184(1) of the Companies Act 2013 read with rule 9(1) of the company rules 2014. 
  • Corporate Social Responsibility: With respect to Section 135 of Companies Act 2013 every Public limited unlisted company must follow CSR initiatives and hold meetings and approve CSR activities. 

Event based Compliances of Listed Public Limited Company:

Apart from annual compliances there are some event based compliances for listed public companies like:

  • Change in Administration
  • Unexpected corporate growth issues
  • Activities pertaining to change in company’s administration
  • Unexpected activities needed to be performed.

Event based Compliances of UnListed Public Limited Company:

Event based compliances for listed public companies include: 

  • Changes made in either Memorandum of Association or Article of Association
  • Any Changes made in the name of the office registered.  
  • Change of address
  • Any unforeseen changes

Listing Requirements :

Apart from above mentioned annual and event based compliances, If the company's shares are listed on a stock exchange, it must comply with additional regulations set by authorities such as the Securities and Exchange Board of India (SEBI) and BSE or NSE stock exchanges. These requirements include timely disclosure of price-sensitive information, maintenance of minimum public shareholding, strictly following corporate governance norms and compliance with listing agreement provisions. Ensuring compliance with listing requirements is essential to maintain the company's listing status and uphold investor trust in the capital markets.

Regulatory Requirements

Apart from the above-mentioned compliances, all Public limited companies must follow regulations related to corporate governance norms prescribed by different regulatory authorities like GST commission, PF, ESI, and TDS depending on its requirements. The last date for payment of stamp duty on share certificates is 30 days from date of share issuance.

Sector-Specific Regulations:

Public limited companies can be subjected to sector-specific regulations, depending on their industry and business activities. Different Compliance requirements like environmental laws, labor laws, intellectual property laws, data protection regulations, and other sector-specific requirements can be asked to meet from companies. 

Compliance Monitoring and Updates:

Public limited companies must stay updated of changes in laws, regulations, and government policies which can affect their business operations. Regular monitoring of regulatory updates, compliance with new requirements, and proactive measures to address legal changes are essential to meet compliance risks and uphold corporate integrity. Establishing robust compliance mechanisms, appointing qualified professionals, and conducting periodic audits facilitate effective compliance management.

Annual compliances of listed Public Limited Company:

A) Board Meetings and Annual General Meetings:  

A listed Public Limited Company under Section 2(52) of the Companies Act 2013 must conduct one Annual General Meeting or AGM under Section 121(1) of the companies act 2013 which is a compulsory yearly meeting of the shareholders of a company. AGM has  many purposes but the main purpose of  AGM is to lay the financial statements of the company infront of its shareholders. It is to be conducted within 30 days of registration of a public company. Details like financial statements, payment of dividends, and appointment of auditors are also discussed in the annual general meeting. Details of the company's operations and management are also discussed. In AGMs shareholders directly tell their feedback about the company and its performance to the management. As per Companies Act, 2013, if a company fails to conduct its AGM within the prescribed time, it is regarded as a violation and the company is liable for penalty. This penalty is imposed on the company as well as on its directors also. The fine is decided by the government. Both the companies and directors are advised to conduct regular AGMs to avoid penalties and legal issues.  An unlisted public company must conduct at least four board meetings annually as per Section 173 of the Companies Act, 2013.

B) Appointment of Auditor:

Appointment of an auditor via FORM ADT-1 is compulsory for a public limited company under Section 139 of the Companies Act. ROC needs to be intimated regarding auditors appointment. The Company’s accounts are audited by a Chartered Accountant firm, and the auditor’s duty is to verify the books of account and issue an audit report. As per the Companies Act, the appointment of the first auditor is done by the Board of Directors within 30 days of the date of incorporation of the company. Auditors are also appointed at each Annual General Meeting (AGM). In case the company fails to appoint an auditor during an AGM, the current auditor remains in office till a new auditor is appointed. If the current auditor fails to continue his work, the company should notify this to the ROC within 7 days of the Annual General Meeting. In such cases ROC holds the authority to appoint a new auditor. After the company has itself appointed an auditor during AGM, it has to file Form ADT-1 with the ROC within 15 days of the AGM. Form ADT-1 has details of the auditor and their appointment. 

C) Filing of ITR:

Every listed public limited company must file an income tax return. It contains information of its income and taxes paid during a financial year. Public listed Companies must file the ITR on or before 30th september of the financial year. The particulars of the income tax return must include information as demanded by the income tax department. The ITR should be filed in the via Form ITR-6 prescribed and should have details of the company's income from all sources, taxes paid by the company, deductions claimed and any tax liability for the financial year. Income tax returns must be filed by public limited companies irrespective of any profit or losses made during the financial year. Failure or delay in filing ITR can lead to penalties and interest payments.

D) Filing Annual Return:

Every listed public company must file an annual return with the ROC according to section 92 of the companies act, 2013. It contains details about the Company’s members/shareholders and directors. Form MGT-7 is to be submitted to file the annual return. Annual return must be filed within 60 days from the date on which AGM was conducted.

E) Filing of Financial Statement with the ROC:

As per section 137 of companies act read with rules 12(2) of the company’s (account) rules 2014, every listed public limited company has to file its financial statements with the Registrar of Companies (ROC) within 30 days of the Annual General Meeting (AGM). This is done via form AOC-4. The financial statements that are required to be filed are the Director’s report, Cash Flow Statement, Balance Sheet,  Auditor's Report, statement of equity changes ,Profit and Loss Account and any other document that is required to be attached in financial statements. The financial statements are to be audited by a qualified auditor, who after finishing the audit issues an audit report. Non- filing financial statements with the ROC within the due date can lead to fines. The type and amount of penalty depends on the delay and the type of company. Financial statements of a public limited company are company records or reports that present the financial position, performance and standing of a company. They provide in-depth information on the company’s financial activities like its revenue, profits, expenses, assets, liabilities and equity.

F) Secretarial Audit Report: 

If the total paid up capital of public company is equal to or crosses INR 50 Crore or its annual turnover is equal to or above 250 crore rupees then under section 204 of companies act 2013 that company has to submit secretarial audit report along with board report top the ROC via form MR-3. 

 

Public Limited Company Compliance 

In India the journey of a public limited company begins with its registration with the Registrar of Companies which is governed by the Companies Act, 2013. It involves obtaining Digital Signature Certificates (DSCs) and Director Identification Numbers (DINs) for directors, choosing a unique company name, drafting Memorandum of Association (MOA) and Articles of Association (AOA) and filing the incorporation documents with the ROC. Basically the whole process of registration as well as compliance of a public limited company is very similar to that of a private company. Below is a list of Annual compliances of both listed and unlisted Public companies.

Benefits of One-Person Company Compliances

To boost investor confidence and for legal reasons members of One Person Company must regularly comply with the Companies Act, Income Tax Act, and GST regulations. Since 2018, there has been a requirement for annual compliance, compelling companies, including OPCs, to submit annual filing forms by 30th of September each year. Advantages of Conducting Annual Compliances for One Person Company includes: 

  • Limited Liability Protection of Director
  • Enhanced Funding Support Chances
  • Continuous Existence of OPC
  • Facilitating Investment from Investors
  • Maintaining Active Status
  • Ensuring Accuracy of Collected Data
  • Avoiding Huge Penalties

Online Process of OPC Compliance

All necessary forms for OPC compliance like AOC4, MGT7, and ADT-1 are submitted online through the following process:

  • First you need to open the MCA website
  • Download the e-form to be filed by you
  • Fill up the details given in the form carefully
  • Now click the link “Upload e-form”
  • Upload the duly filled e-form
  • After successfully uploading the form you are asked to pay a fee
  • Deposit the fee online.

Company Compliances Overview 

Registration of companies in India comes under the Companies Act of 2013. Registration of companies is done by the Registrar of Companies (ROC) under the Ministry of Corporate Affairs (MCA).  Company incorporation provides various benefits like asset protection, enhanced funding, business branding, etc. 

After registration and start of business, there are also certain compliances for companies that need to be obliged to after registration. Some compliances are mandatory compliance, whereas some compliances of  companies need to be fulfilled annually. It should be kept in mind that a  company is eligible for yearly compliance right from the moment it is registered. Non-compliance leads to various issues for the company, ranging from huge penalties to legal consequences. To avoid such issues, companies need to be compliant and well-informed with the applicable compliance requirements. We at Apkatax help you with both company registration and annual compliance for all types of companies at affordable packages.

Documents required For LLP Compliance include:

  • Registration documents of LLP
  • List containing names of partners
  • Proof of fee payment
  • Statement of solvency and accounts filed by LLP with the ROC

Consequences of Non Compliance of LLP

Non-compliance with LLP regulations can lead to various consequences for partners of LLP including monetary penalties, financial losses, and damage to the reputation of the LLP. Some of the key consequences of non-compliance are:

  • Penalties and Fines: The Registrar of Companies (ROC) may impose penalties and fines for non-compliance with LLP regulations. LLP and its partners may be fined anywhere between rupees 10 thousand to five lakhs depending on the violation and may have to pay on a daily basis until the compliance requirement is carried out. 
  • Legal Proceedings: Non-compliance may result in legal proceedings initiated by regulatory authorities, creditors, or other stakeholders. This could lead to costly litigation, court appearances, and potential liability for damages.
  • Loss of Limited Liability Protection: Failure to comply with LLP compliance can lead to loss of limited liability protection enjoyed by the partners. 
  • Reduced Financing: Non-compliance may limit the LLP's ability to raise funds from various investors or get financing from banks, financial institutions, or investors. Lenders and investors often view non-compliance as a risk factor and stop or reduce funding.
  • LLP Dissolution: If an LLP fails to comply with annual  compliance for an extended period, the Registrar of Companies may take action against the LLP and can strike off the LLP's name from the register. This leads to the dissolution of the LLP and end of its legal existence.
  • Restrictions on Business Operations: Regulatory authorities may impose restrictions or sanctions on the operations of non-compliant LLPs, such as freezing bank accounts, suspending licenses or permits, or prohibiting certain business activities.
  • Damage to Reputation: Continuous non-compliance can damage the reputation of the LLP among customers, suppliers, partners, and other stakeholders. It signals poor governance, lack of transparency, disregard for legal obligations etc which erode trust and credibility and further damages the LLP reputation.

Benefits of LLP Compliance

  • Limited Liability: Biggest benefits of LLP compliance is limited liability protection. The personal assets of the LLP partners are shielded from the debts and liabilities of the LLP. This means that the partners are only liable to the limit of their capital contribution in the LLP.
  • Avoid Penalties: Regular compliance by LLP may help avoid unnecessary fines. 
  • Tax Benefits: LLPs are taxed at a lower tax rate in comparison to other companies. Additionally, partners are taxed individually on their share of profits, avoiding double taxation.
  • Increased Credibility: Conducting regular compliance for your LLP enhances the credibility of the business in the eyes of stakeholders such as suppliers, customers, and financial institutions.
  • No Mandatory Audit: LLPs with a turnover below a certain threshold are not required to undergo a mandatory audit, reducing compliance costs.
  • Minimal Compliance Requirements: LLPs have fewer compliance requirements compared to other forms of companies. Annual filings and statutory meetings are also less hectic making it easier to manage the administrative aspect of the business.
  • Business Continuity: Regular Compliance ensures that LLPs are operated smoothly and continue to prosper for a longer duration without undergoing closing.

List of LLP Compliances 

Just like other companies who have to fulfill compliance obligations, Limited Liability Partnerships (LLPs) are also required to comply with certain annual obligations to maintain their legal status and ensure regulatory compliance. The annual compliance requirements for LLPs typically include:

  • Annual Return Filing (Form 11): Limited Liability Partnerships are required to file an return annually with the ROC within 60 days from the closure of the financial year. Form 11 provides details of management affairs of LLP like principal place of business, partners' details, and financial statements.
  • Financial Statement Filing (Form 8): LLPs must also file their financial statements, including the Statement of Account and Solvency, with the RoC within 30 days from the end of six months of the financial year. Form 8 provides information about the profits made and of the LLP's financial position and performance. 30th October is the Due date of filing form 8 of every year. 
  • Income Tax Return Filing: LLPs are required to file their income tax return annually with the Income Tax Department. The due date for filing income tax returns varies based on the LLP's turnover and other factors like whether the LLP is required to do a tax audit or not. 
  • Bank Account: A bank account needs to be opened on LLP’s name
  • Audit Requirement: LLPs are required to undergo a statutory audit if their annual turnover exceeds 40 lakhs rupees or if the contribution exceeds Rs. 25 lakhs. The audit has to be conducted by a qualified Chartered Accountant in accordance with the LLP  Act and applicable accounting standards.
  • Other Compliance Requirements: Apart from the annual compliance mentioned above, LLPs may have other regulatory obligations based on their specific activities, industry, and agreements with partners. These may include maintaining books of accounts, compliance with Goods and Services Tax (GST) regulations, compliance with the Employee Provident Fund (EPF) and Employee State Insurance (ESI) schemes if applicable, among others.

It is essential for LLPs to ensure timely compliance with these annual obligations to avoid penalties, maintain their legal status, and uphold transparency in their operations. Seeking assistance from qualified professionals such as Chartered Accountants and Company Secretaries can help LLPs navigate the complex regulatory landscape and ensure compliance with applicable laws. 

What are the Documents Required for the Compliance of Pvt Ltd Company?

Many documents are required to be filed for annual compliance of a Private Limited Company. These are:

  • Sales and purchase bills of expenses during the year.
  • Details of Bank Statements, to be fetched from 1st April to 31st March of all bank accounts of the Company.
  • Details of GST returns filed.
  • Details of both TDS Returns and TDS Challans. 
  • Details of Balance sheet
  • Details of Profit & Loss Account.
  • Copy of Financial statements.
  • Copy of Directors report.
  • Details of the Member.
  • Details of Directors.

Online Process for Private Limited Company Compliance 

All forms needed for pvt ltd company compliance like AOC4, MGT7, and ADT-1 can be submitted online via this process:

  • Open the MCA portal
  • Download the e-form of your choice
  • Fill up the form
  • Now click on the given link “Upload e-form”
  • Upload your filled e-form
  • After you have successfully uploaded the form, you are required to pay a fee
  • Pay the required fee online 

Benefits of Private Limited Company Compliances

Companies must regularly comply with the Companies Act, Income Tax Act, GST and other regulations to boost investor confidence and increase their businesses. Since 2018, there is a requirement for annual compliance, asking companies to submit the annual compliance filing forms by the 30th of September each year. Advantages for filing Annual Compliances for the Private Limited Company include: 

  • Inviting Investors: Investors before investing largely focus on financial data and records of companies compliance. Thus regular filing of annual compliances on the MCA portal becomes necessary for attracting investors. They prefer companies with a consistent  and clean compliance record. Thus, regular annual compliance for all companies is essential to attracting more investors of all kinds.
  • Reflect Company Credibility: Regular compliance is a key criteria for the measurement of a company's  reputation and credibility in the market. It enhances business’s credibility and reflects the owner's seriousness, which attracts more customers and results in more business. It also makes getting government tenders and loan approvals easily, thereby opening new opportunities for financial support. 
  • Continue Active Status and Avoid Penalties: Regular filing of annual compliances is also necessary to avoid huge penalties and maintain active status of business. Failure to file compliance for a company with ROC can downgrade the Company's ratings. Non-compliance may also lead to the Company being marked as defunct or removed from the ROC. Company’s  directors may also be removed and debarred from future appointments. Since July 2018, a fee of ₹100 is levied for delays of each day in filing.

List of Compliance for Private Limited Company

Annual compliances for Private Limited Companies involves: 

A) Conducting Board Meetings and Annual General Meetings

A Private Limited Company should conduct at least four board meetings annually as per Section 173 & 96 of the Companies Act, 2013. It must also conduct one Annual General Meeting or AGM which is a compulsory yearly meeting of the shareholders of a company. AGM serves many purposes but the main purpose of conducting AGM is to present the financial statements of the company infront of its shareholders. Details like payment of dividends, financial statements, and appointment of auditors are also discussed in the annual general meeting. Details of the company's operations and management are also discussed. During the annual general meeting, the shareholders can ask questions, raise concerns, and vote on the company's proposals like the election of directors, dividend payments and appointment of auditors. In AGMs shareholders directly tell their feedback about the company and its performance to the management. As per Companies Act, 2013, if a company fails to conduct its AGM within the prescribed time, it is regarded as a violation and the company is liable for penalty. The penalty is levied both on the director as well as on the company. The fine is decided by the government. Both the companies and directors are advised to conduct regular AGMs to avoid penalties and legal issues. 

B) Appointment of Auditor

Appointment of an auditor via FORM ADT-1 is compulsory for a  Company under Section 139 of the Companies Act. ROC needs to be informed regarding this. The Company’s accounts are audited by a Chartered Accountant firm, and the auditor’s duty is to verify the books of account and issue an audit report. As per the Companies Act, the appointment of the first auditor is done by the Board of Directors within 30 days of the date of company formation. An auditor is also appointed at each Annual General Meeting (AGM). In case a company fails to appoint an auditor during an AGM, the current auditor remains in office till a new auditor is appointed. If the present appointed auditor fails to continue, the company must notify this to the ROC within 7 days of the AGM. In such cases ROC holds the authority to appoint a new auditor. After the company has itself appointed an auditor in the AGM, it must file Form ADT-1 with the ROC within 15 days of the AGM. Form ADT-1 has details of the auditor and their appointment. The company must also file its audited financial statements along with the auditor's report, with the ROC within 30 days of the AGM. Filing these documents is mandatory. Failing to file form ADT -1 with the ROC on time, attracts penalty as per Section 450 of the Companies Act of 2013. 

C) Filing of Annual Income Tax Return

Every company must file an income tax return. It contains information of its income and taxes paid during a financial year. Pvt Companies are required to file the ITR with the ROC within 60 days from the AGM date. The particulars of the income tax return must include information about the Company’s members/shareholders and directors. Form MGT-7 is to be submitted to file the annual return. The ITR should be filed in the format  prescribed and should contain details of the company's income, taxes paid by the company, deductions claimed and any tax liability for the financial year. Income tax returns must be filed mandatorily irrespective of any profit or losses during the financial year. Delay or failure to file income tax returns can lead to penalties and interest payments on it. The last date to file the Income Tax Return for domestic companies is 31st October 2024.  However, if the company does international transactions or specified domestic transactions and needs to furnish a report in Form No. 3CEB u/s section 92E, the due date to file ITR is 30th November 2024. The last date of filing revised or late returns is 31 December 2024.

D) Filing Financial Statement

Financial statements are official records or reports that present the financial position, performance and standing of a company. They provide in-depth information on the company’s financial activities like its revenue, profits, expenses, assets, liabilities and equity. Three main financial statements are needed to be prepared and published annually by a private company as part of its financial reports:

  • Income Statement/Profit and Loss Statement: The income or Profit and Loss statement provides information about the company's total revenues, its expenses and net profit or loss for a given period, for example, an year.
  • Balance Sheet: The balance sheet of a company shows the company's assets, liabilities, and shareholding at a particular point, usually at the end of the financial year. 
  • Cash Flow Statement: It shows the inflow and outflow of cash during a financial year. It gives information on the investing, operating and financing activities of the company.

All companies need to prepare their financial statements within 6 months from the end of their financial year.If the financial year of the company ends on September 30, then the due date for the preparation of its financial statements would be March 31 of the next year. 

E) Filing of Financial Statement with the ROC:

Every company is required to file its financial statements with the Registrar of Companies known as ROC Filing within 30 days of the Annual General Meeting (AGM). The financial statements that need to be filed must include Balance Sheet, Statement of equity changes, Profit and Loss account, Cash Flow Statement and any other document that needs to be attached in financial statements. The financial statements must be audited by a certified auditor, who after conducting  the audit will issue an audit report attached along with financial statements. Non-compliance in filing financial statements with the ROC before the due date can attract fines and penalties. The type and amount of penalty depends on the delay and the type of company

F) Disclosure of Interest:

Every financial year, the directors of the company must disclose their interest in other entities using form MBP-1,  in its first Board meeting. In case of default the director  may face jail term for up to 1 year.

G) KYC of the Company’s Directors:

For fulfilling KYC of directors, all directors who have DIN allotted as of March 31st of the financial year must submit Form DIR-3-KYC for the current financial year on or before September 30th of the upcoming financial year. Form DIR-3-KYC has various details like director's name, PAN, address, Aadhaar number and mobile number. This filing is to be done before the due date. Non filing or late filing of DIN KYC leads to penalty or deactivation of the director's DIN. Two different forms are used to file KYC of directors that have DIN. The first is Form DIR-3 KYC, which is filed by DIN holding directors who have never filed DIR-3 KYC before or want changes in their KYC details. The second form is DIR-3 KYC Web. It is the online form to file KYC details for persons who have filed DIR-3 KYC earlier and do not want to make any changes to their KYC details. If Form DIR-3 KYC is not filed before the due date, the DIN is deactivated by MCA. 

H) File Form DPT-3:

Form DPT-3 must be filed every year on or before June 30th concerning return of Deposits and particulars are not considered Deposits as of March 31st. 

I) Maintain Statutory Register: 

Companies are required to maintain statutory registers as per Section 88 of the Companies Act 2013. Also certain event-based compliances are to be followed by companies, like share transfers, appointment or resignation of directors, change in nominees or bank signatories and change in auditors. Apart from the above-mentioned compliances, every company has to follow regulations related to GST, PF, ESI, and TDS depending on its requirements. The payment of stamp duty on share certificates has to be done within 30 days of share issuance.

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