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

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

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

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

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

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

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

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

Parties to the Compliance Regulator Consultant Shareholder In-house Compliance Department Director Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

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

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

Income Tax >Company Law (Approach / Mind Set) AMA 29-08-2019 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 Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

Types of Companies Company Limited By Guarantee AMA 29-08-2019 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) Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

Types of Pvt.Ltd.Companies Compliance Wise AMA 29-08-2019 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) Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

2 Board Meetings Instead of 4 Less Certification of Various Forms Benefits of Small Company(PVT.LTD.) 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 Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

Event Based Compliances AMA 29-08-2019 Type of Compliances Mandatory Annual Compliances (Every Year) Event Based Compliances Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

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

EVENT BASED COMPLIANCES 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 Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

Post Incorporation Payment of stamp duty on share certificates 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 Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

Types of meetings Board Meeting General 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 Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

Essentials Parts of 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 Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

Annual General Meeting Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

AGM Law & Procedures Types of AGM 1st AGM Rest AGM Example: 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. Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

AGM Law & Procedures 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. Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

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

Annual Filing Main Form AOC-4 MGT-7 ADT-1 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 Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

Specific Annual Filing Applicability Forms 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 Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

Maintenance of Statutory Registers 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 Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

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

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

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

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

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

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

RECONSTRUCTION OR EXIT OPTION AMA 29-08-2019 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) Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

How to Avoid Huge Compliance Cost ? AMA 29-08-2019 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 Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

Cost of non compliance is always more than cost of compliance. Compliance is not a one-time thing, but is a continuous affair. Cost of non compliance is always more than cost of compliance. Manish S Buchasia PCS IP-IBC RV NCLT AMA Ahmedabad 29-08-2019

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