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An Overview of MCA Compliance for Companies and Limited Liability Partnerships

The Ministry of Corporate Affairs regulates and monitors the operation of companies and limited liability partnerships in India. Post incorporation, there are many annual filings and event-based compliance that the Ministry of Corporate Affairs or MCA requires companies and LLPs to adhere to. These Compliance are compulsory, and every company incorporated under the Companies Act, 2013 or LLP incorporated under the Limited Liability Partnership Act, 2008 must comply with all the necessary ones to avoid incurring hefty penalties. It is imperative that all entities governed by the MCA remain aware of the MCA mandates, ensure adherence to all annual, half-yearly and event-based Compliance and file all requisite forms well before the due date to avoid unnecessary late fees and penalties for non-compliance. Making sure that one’s company or LLP is MCA compliant can be a daunting and taxing task for people not well-versed with the MCA norms and regulations. Hence, it is prudent to take professional help to carry out all requisite compliance tasks and file all necessary forms with MCA on time.

MCA Compliance for Companies

Every Private Limited Company, Public Company, One-Person Company, or Section 8 Company is required to comply with the MCA norms and mandates. Some of the important Compliance which companies are required to be followed are mentioned below:

  • Form INC 20 A

This form is to be filed by companies which have been incorporated after November 2, 2018, to inform the ROC of the commencement of the business of the company. This form must be filed only once and within 180 days from the incorporation date of the company.

  • MSME Form 1

This form is to be filed by companies who have taken supplies from vendors who are MSMEs or Micro, Small and Medium Enterprises and when there is outstanding payment to be made to such MSMEs. Such payment must be pending for a period of more than 45 days. The form is used to file half-yearly returns with the Registrar.

  • Form DIR-3 KYC

In accordance with Rule 12A of Companies (Appointment and Qualification of Directors) Rules, 2014, directors of a company with a Director Identification Number or DIN are required to file an e-form DIR-3 KYC with the MCA. Directors who have already filed the e-form for the last fiscal year can complete their KYC through the web-based KYC services of MCA through a verification process facilitated using OTPs sent on previously registered mobile numbers and email IDs. This form must be filed annually.

  • Form DIR-12

Any appointment of directors or cessation of directorship or regularization of directors must be reported to the MCA as is provided for in Section 170(2) of the Companies Act, 2013. This form must be filed within 30 days of the annual general meeting.

  • Form ADT-1

In accordance with Section 139 of the Companies Act 2013, all companies are required to inform the Registrar of Companies or ROCs about the appointment of an auditor in the company. The form is to be filed within 15 days of the annual general meeting.

  • Form AOC-4

This form AOC-4 is to be filled for filing the annual financial statements of the company with the Registrar. The form is to be filed within 30 days of the annual general meeting. For a one-person company, the form must be filed within 180 days of the end of the fiscal year.

  • Form MGT-7 and MGT-7A

This form is filed to provide for the annual accounts and other details of the company. Form MGT-7  is to be filed within 60 days from the end of the annual general meeting.

  • Form MGT-14

This form is filled for filing details of resolutions passed in meetings with the MCA. Details pertaining with respect to annual accounts and board reports passed in the resolution are to be filed. Form MGT-14 must be filed within 30 days from when the board resolution was passed.

  • Form BEN-1

This form is to be filed to give details of any declaration made to the reporting company by a significant beneficial owner. Companies (Significant Beneficial Owners) Amendment Rules, 2019 has mandated that significant beneficial owners must make declarations to the reporting company giving details of their interest in the company by filing Form BEN-1. The mandate also extends to giving information about any change in the ownership of the significant beneficial owner. This form must be filed with the reporting company within 30 days from when such person was made the significant beneficial owner or from when the change in ownership took place.

  • Form BEN-2

This form must be filed by the reporting company with the ROC as a return of the declaration made by the beneficial owner in Form BEN-2. This mandate is made in Rule 4 of the Companies (Significant Beneficial Owners) Rules, 2014 and Section 90(4) of the Companies Act, 2013. Form BEN-2 must be filed within 30 days of the receipt of Form BEN-1.

  • Form DPT-3

As is provided under Rule 16 of Companies (Acceptance of Deposits) Rules, 2014, all companies other than a government company are required to file this form for giving details of deposits or transactions involving money or loan not amounting to a deposit. Form DPT-3 must be filed annually by 30th June of every year.

  • Form PAS-6

As is provided under Rule 9A (8) of Companies (Prospectus & Allotment of Securities) Rules, 2014, all unlisted public companies must file this form for reconciliation of audit report of their share capital. Form PAS-6 must be filed within 60 days of the end of each half-year. This mandate is not applicable to government companies, Nidhi companies or a subsidiary which is wholly owned.

  • Form MGT-4

Form MGT-4 must be filed to give details of any declaration made to the reporting company by persons who are registered owners of shares but do not have any beneficial interest in such shares. This declaration is to be made within 30 days from the date on which such person's name is entered into the register of the company's members. Such declaration must also be made when there is any difference in the beneficial interest in such shares.

    • Form MGT-5

    Form MGT-5 is filed to give details of any declaration made to the reporting company by persons who have a beneficial interest in shares but whose names are not entered in the member's register of the company. This declaration is to be made in 30 days from when such a person acquires a such beneficial interest. Such declaration must also be made when there is any difference in the beneficial interest in such shares.

    • Form MGT-6

    This form must be filed by the reporting company with the ROC as a return of the declaration made by the beneficial owner in Form MGT-4 and Form MGT-5. This mandate is made in Section 89 of the Companies Act, 2013. Form MGT-6 is must be filed within 30 days of the receipt of Form MGT-4 and Form MGT-5.

    • Form MGT-14

    This form is filed to provide details of any special resolutions passed in an annual general meeting. All companies are required to provide such details as provided in Section 117 and Section 179 of the Companies Act 2013. Form MGT-14 must be filed within 30 days of the annual general meeting.

    • Form MR-1

    This form must be filed by public companies with the ROC giving details pertaining to the appointment of directors, managers, and whole-time directors or the reappointment of such individuals. Form MR-1 must be filed within 60 days from the date of such reappointment or appointment. This mandate is provided under Section 196(4) of the Companies Act, 2013, along with Rule 3 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

    • Form CRA-2

    This is applicable to companies on whom cost audit applies declared by the Central Government as provided under Section 148 of the Companies Act, 2013. This form is to be filed to inform the ROC as to the appointment of cost auditors as per Section 148(3) of the Companies Act, 2013, along with Rule 6 of Companies (Cost Records and Audit Rules), 2014. Form CRA-2 must be filed within 180 days from when the fiscal year begins or within 30 days of such appointment. Where a casual vacancy is to be filled, it must be filed within 30 days, and the form is to be filed within 30 days of the board meeting.

    • Form CRA-4

    This is applicable to companies on whom cost audit applies declared by the Central Government as provided under Section 148 of the Companies Act, 2013. This form is to be filed by the company after it receives the cost audit report from the cost auditor. The cost audit report must be given to the company within 180 days from the end of the fiscal year. Such audit report must be submitted by the company to the Central Government within 30 days of receipt of the report from the cost auditor.

MCA Compliance for LLPs

Some of the important Compliance which LLPs are required to be followed are mentioned below:

  • Form 8

This form must be filed with the ROC by two designated partners of the LPP within 30 days from the end of the fiscal year. All LLPs must prepare their accounts and close them well before March 31 of every year.

  • Form 11

Form 11 must be filed annually by LLPs, which shall include details of the partners of the LLP and the business conducted by it. Every LLP which has been duly registered must file this form within 60 days from when the fiscal year ends.

  • Form DIR-3 KYC

In accordance with Rule 12A of Companies (Appointment and Qualification of Directors) Rules, 2014, designated partners of an LLP are required to file an e-form DIR-3 KYC with the MCA. Partners who have already filed the e-form for the last fiscal year can complete their KYC through the web-based KYC services of MCA by a verification process facilitated using OTPs sent on previously registered mobile numbers and email IDs. This form must be filed annually.

Event-based Compliance

There are certain event-based Compliance which must be followed by companies and LLPs when specific events take place. Some of the event-based Compliance are mentioned below:

  • Change in directors:

Form DIR-12

Any appointment of directors or cessation of directorship or regularization of directors must be reported to the MCA as is provided for in Section 170(2) of the Companies Act, 2013. This form must be filed within 30 days of the annual general meeting.

  • When there is any change in the objectives of the company, the resolutions which are passed to that effect must be filed under Form MGT-14 with the ROC.
  • When there is any alteration in the capital structure of the company, Form SH-7 is required to be filed.
  • Form PAS is to be filed when securities are allotted.
  • Form INC 22 is to be filed in case of a change in the registered office of the company.
  • When there is a change to be made in the LLP deed, LLP Form 3 must be filed.
  • When there is any change in the partners of an LLP, LLP Form 4 is required to be filed.
  • When there is any change in the address of the registered office address of the LLP, LL Form 15 must be filed.

Owners of companies and LLPs must ensure that their business entity is MCA compliant, which can often prove to be a daunting and confusing task. However, it is imperative to adhere to all necessary MCA Compliance to avoid incurring heavy penalties. Swarit Advisors provides its exceptional services to companies and LLPs to ensure the timely filing of forms and assess whether the entity is MCA compliant or not.It is always prudent to approach professionals like Swarit Advisors, who shall assist your business to ensure that it is compliant with every legal and regulatory requirement.

Frequently Asked Questions

Annual General Meetings are required to be held within six months from the end of the Fiscal Year for all companies except a one-person company. There must not be a gap exceeding 15 months between two annual general meetings. The very first annual general meeting is to be conducted within nine months from the end of the Fiscal Year.

Every company must hold four board meetings, and the gap between such meetings must not exceed 120 days. One-person companies and dormant companies are only required to hold one meeting every six months, and the gap between these meetings must not be less than 90 days.

The Ministry of Corporate Affairs requires every company or LLP to report its business operations and processes with it annually by filing specific forms. There are many annual filings and event-based Compliance that the MCA requires companies and LLPs to adhere to.

It is mandatory for companies and LLPs to adhere to the mandates pertaining to annual filings. Non-compliance can lead to hefty penalties and late fees.

The e-forms are to be filed on the official website of the MCA or Ministry of Corporate Affairs.

The Registrar can grant extensions to companies or LLPs which require more time to file the requisite forms if the ROC finds the reason for the extension sufficient and valid.

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