POST-INCORPORATION STATUTORY COMPLIANCES FOR SECTION 25 COMPANIES

Transcription

1 POST-INCORPORATION STATUTORY COMPLIANCES FOR SECTION 25 COMPANIES COMPLIANCES UNDER THE COMPANIES ACT, 1956 Upon incorporation, a company is required to file with the ROC on an annual basis the following: Balance Sheet of the Company, and Annual Return Apart from the aforesaid, there are periodic documents/forms required to be filed with the ROC, if such need accrues, which are more particularly discussed ahead. 1. FIRST BOARD MEETING Business to be necessarily transacted within a month of incorporation in the First Board Meeting of the company: Appointment of First Auditors: Within one month of incorporation of a Company, the Board appoints first auditors of the Company. In case the first auditors are not so appointed within one month of the company incorporation, then they can only be appointed by the shareholders in a general meeting. It means the first Board meeting should be held within one month from the date of its incorporation. Commencement of Financial Year: The first Board must also decide the Financial Year of the company. Usually, the first financial year strikes on from the date of incorporation of the company, until the approaching 31 March. Thereafter each subsequent financial year would commence from 1 April and until 31 March.

2 Description of Directors: The first Board Meeting must also record the particulars and description of the directors and also the notices of interest from the Directors. Minimum 4 Board Meetings: The meeting of the Directors should be held atleast once in every 6 month but atleast 4 Board Meetings of the Company must be held in each calendar year. Quorum: The quorum of the meeting constitutes of at the minimum 1/3 rd of the entire strength of the Board, or 2 directors whichever is higher. 2. ANNUAL GENERAL MEETING TO BE HELD IN EACH YEAR Business to be transacted in the Annual General Meeting (AGM):- Adopt Annual Accounts - Annual General Meeting is required to be held each year wherein the members of the Company adopt the Annual Accounts and auditors are re-appointed. The meeting is alternatively also called the shareholders meeting. Place First annual accounts before shareholders: The balance sheet, the profit & loss accounts, auditor s report and the director s report are required to be placed before the shareholders for their adoption as required by section 210 of the Companies Act, Within thirty days of their adoption, three copies of the balance sheet, profit and loss account, auditor's report duly signed by any two Directors of the company are required to be filed with the concerned registrar. AGM to be held within : The first annual general meeting can be held within 18 months of incorporation. Generally second and subsequent AGMs are held within 6 months from the last day of the financial year. The gap between the two AGM shall not exceed the period of 15months if the

3 period is extended then it is mandatory to take permission with the Registrar, if the registrar satisfy that due to any special reason the company is unable to conduct its AGM in the given time then it can be extended not exceeding the period of 3 months. (The gap between the last day of the financial year and date of holding the first annual general meeting should not, however, exceed nine months.) NOTICE FOR CALLING AGM : AGM can be called by giving a notice of not less than 14 days. DAY,DATE & PLACE OF AGM : In section 25 company, AGM can be held on any day or it can also be held on public holiday further it can be held even after business hours. 3. FILING ANNUAL RETURN It is required to be filed with the Registrar every year a return in the form given in part II of schedule V to the Act along with all the information as required to be furnished in accordance with part I of the said schedule. This return is called the 'annual return', which is required to be prepared and file with the Registrar under section 159 of the Act. It is made as on the day of the annual general meeting. If the annual general meeting is not held, then it is to be made as on the day when the annual general meeting ought to have been held. It is to be filed within sixty days of the annual general meeting or on the day on which it ought to have been held, as the case may be. 4. STATUTORY BOOKS AND REGISTER WHICH A COMPANY MUST MAINTAIN A Company should maintain statutory books and registers listed below. Non-maintenance of these registers attracts penal provisions under the

4 relevant sections of the Act. Most of these registers are also required to be made available for inspection to any member / debenture holder and, in some cases, to other persons as well, during business hours. Subject to such other restrictions as the company may impose by its articles or in general meeting, not less than two hours in each working day must be allowed for inspection: LIST OF REGISTERS, BOOKS, ETC., REQUIRED TO BE MAINTAINED: Particulars of register, books etc. Section / Rule of the Companies Act, 1956 Register of Members 150 (1) Register of Directors 303 Register of Director Shareholding Register of Contracts (Disclosure u/s 299) 301 Register of Common Seal Register of fixed deposits 58 A Copy of every instruments creating any charge 136 requiring registration Index of members (if a company has more than 151 (1) 50 members) Copies of all annual returns prepared under 159 / (1) section Minutes of board of directors and committees 193 (1) thereof Minutes of proceedings of general meetings 193 (1) Books of account 209 (1) (a), (b) & (c) Proper books of account relating to transactions 209 (2) effected at branch office

5 All the aforesaid documents need to be maintained/ kept at the Registered Office of the Company. MAINTAINCE OF BOOKS OF ACCOUNTS : In section 25 company, company is require to maintain books of accounts for a period of only 4years instead of 8 years as per the requirement of section 209(4A) of the Companies Act, TAX RELATED COMPLIANCES 1. PERMANENT ACCOUNT NUMBER (PAN) After incorporation, the Company must obtain its PAN. For this purpose, an application needs to be filed with the Income Tax Department in Form 49A with the necessary documents. PAN is mandatory for opening of Bank Account, filling of Income Tax returns and various other financial transactions including making and receiving the payments.. 2. TAX DEDUCTION ACCOUNT NUMBER (TAN) TCS/TDS deposit has to be made on a monthly basis After incorporation, the Company must also obtain a TAN. For this purpose, an application needs to be filed with the Income Tax Department in Form 49B with necessary documents. TAN is required for depositing of TDS/TCS. 3. Registration of section 25 Company under Section 12A & 80G of the Income Tax Act.

6 For filing an application under section 12A of the Income Tax Act - Form 10A is to be filed along-with relevant documents. For filing an application under section 80G of the Income tax Act Form 10G is to be filed along-with relevant documents. 4. ACCOUNTING AND AUDIT a) Accounting of the Transactions: Accounting of the transactions of the Company held during a financial year by preparing the balance sheet and profit and loss account of the company; b) Audit of Accounts: The accounts prepared by the Company are required to be audited by an independent Chartered accountant or a firm of Chartered Accountants, before the same are filed with the office of the ROC. 5. TAX RETURN AND TAX AUDIT a) Income Tax Return: Preparation of Annual Income Tax return and electronic filing thereof. RBI RELATED COMPLIANCES 1. In case receipt of money for investment in shares from foreigner : Within 30 days of receipt of money from the foreign investor, the Indian company will report to the Regional Office of RBI under whose jurisdiction its Registered Office is located, a report containing details such as: a) Name and address of the foreign investors, b) Date of receipt of funds and their rupee equivalent, c) Name and address of the authorized dealer through whom the funds have been received, and d) Details of the Government approval, if any;

7 2. Filing of FC-GPR form On issue of shares to Foreign Investor, a report in Form FC-GPR together with the following documents should be filed with the Regional Office of RBI within a period of 30 days from the date of issue of shares: a) Certificate from the Company Secretary of the company accepting investment from persons resident outside India certifying that: All the requirements of the Companies Act, 1956 have been complied with; Terms and conditions of the Government approval, if any, have been complied with; The company has all original certificates issued by authorized dealers in India evidencing receipt of amount of consideration; b) Certificate from Statutory Auditors or Chartered Accountant indicating the manner of arriving at the price of the shares issued to the persons resident outside India.