STEP 1: Raise a ticket
STEP 2: Email problem to Infosys personnel along with error message and form so that they will resolve the issue. Kindly inform to your friends also.
COMPANY LAW UPDATE 2
1: Professional & business bodies should represent to New Govt"New Co Law againt "Development":Good lesson for our MCA Minister::Political party & Minister who made Co Law as criminal Law as "CRIMINAL LAW" is out of power: A lession for new party1) A political party who has made company law as "CRIMINAL LAW"(lots of prosecution provision, disproportionate penalty provisions) IS OUT OF POWER. MCA Minister has lo
s
t by 1.5 Lakhs
votes.
2
) People now think better not to form a Company.
3
)
New Company law is against development of corporate form of business in India.
Will New party make some amendments in Company Law so that favorable business environment can be restored?
4) Professional & business organisation such as ICAI, ICSI, ICWAI, Different chamber of commerce etc should represent to New Govt & take advantage of change in political scenario.
COMPANY LAW UPDATE 20
: CL:Donot accept appointment from 1/4/2014
if already holding 20 Cos Audit:
CA Nitesh More
following persons shall not be eligible for appointment as an auditor
of a company, namely:--a person who is in full time employment
elsewhere or a person or a partner of a firm holding appointment as
its auditor, if such persons or partner is at the date of such
appointment or reappointment holding appointment as auditor of more
than twenty companies; 2) As per General Circular 08/2014, the financial statements (and
documents required to be attached thereto), auditors report and Board
report in respect of financial years that commenced earlier than 1st
April, 2014 shall be governed by the relevant provisions/ Schedules/
rules of the Companies Act, 1956 and that in respect of financial
years commencing on or after 1* April, 2014, the provisions of the new
Act shall apply.3) My comments: Although audit report in respect of financial years
that commenced earlier than 1st April, 2014 shall be governed by the
relevant provisions/ Schedules/ rules of the Companies Act, 1956, a
person shall not be eligible for appointment as an auditor of a
company, if he holds appointment of more than 20 companies on or after
1/4/2014. There is no relaxation for disqualification of auditor u/s
141 in this circular.4) Kindly note that those who have already appointed under Companies
Act, 1956 for more than 20 companies can continue. However, he cannot
accept appointment from 1/4/2014 if he is at the date of such
appointment or reappointment holding appointment as auditor of more
than twenty companies
COMPANY LAW UPDATE 1 9
:
CL:If any Loan existing on 1st April,2014 received by a Pvt Ltd co from its shareholders, Director's relatives,can these be treated as deposits & should statement in "Form DPT4" be filled to ROC by 30th June,2014 & all dues to be repaid within 1 year?:
CA Nitesh More 1) Loan is covered under definition of deposits under both Company Act, 1956 & 2013 read with both deposit Rules, 1975 & 2014.
2) a) However, if loan is received from any other company by any co., than it is not covered as deposits under both Co Laws read with both deposit Rules.
b) If loan is received from directors or shareholders or director’s relative by pvt ltd co, than these were not covered as deposits under Co Act, 1956 read with deposit Rules, 1975. However, if such loan is received by Public Ltd co than these were covered as deposits under Co Act, 1956 read with deposits Rules, 1975.
Under New Company law, if loan is received by any company (both Public & Pvt) from directors, than it will not be covered as deposits. However, If loan is received from shareholders or director’s relative by any Co, than these will be covered as deposits.
c) If loan is received from other individuals by either Pvt Ltd Co or Public Ltd Co, than these will be covered as deposits under both Co Law read with both deposit Rules.
3) a) As per sec 74 of Co Act, 2013, If deposit or any interest remains unpaid on commencement of this Act, co. shall file, within 3 months, with ROC a statement in “Form DPT4”of all deposits accepted & sums remaining unpaid and Co repay the dues within 1 year i.e. by 31st march, 201
5
.
b) Tribunal may, on application made by co., allow further time to repay the deposit.
c) Penalty - Company – shall pay deposit and interest along with fine Rs. 1 crore to Rs. 10 crores and officer in default - Imprisonment upto 7 years or fine Rs. 25 Lakhs to Rs. 2 Crores, or both.
4) A question arise if any loan is received by Pvt Ltd Co. from shareholder or director’s relative under Co Act, 1956 should we include these as deposit in Form DPT4 or not?
a) ONE VIEW: Yes, include these as deposits in Form DPT4.
Reasons:
i) The meaning of the term “deposit” under sec 74 under Co Act, 2013 will be as per sec 2(34) of the Co Act, 2013. Hence, these will be included as deposits in Form DPT4.
ii) The intention of introduction of sec 74 is to repay all old deposits within one year time or extended time. MCA wants that all deposits accepted have to follow new Act & New Rules.
iii) This view can also be supplemented by the fact that legislature is giving enough time i.e. 1 year time to repay the deposits existing on 1st April, 2014 to comply with new Act & New Rules.
iv) ROC is expected to take this view .
b) ANOTHER VIEW: No, do not include these as deposits in Form DPT4.
Reasons:
i) These were not deposits at the time when these loans have been received. Hence, sec 74 will not be applicable for such deposits.
ii) What was not a deposit at the time of receiving deposits cannot & should not be subsequently compelled to repay by bringing it under ambit of deposits.
COMPANY LAW UPDATE 1 8
:
PROVISION RELATED TO COMPANY’S STATIONERY INCLUDING LETTER HEAD As per companies Act 2013, companies are required to get its name, address of its registered office and the Corporate Identity Number along with telephone number, fax number, if any, e-mail and website addresses, if any, printed in all its business letters, billheads, letter papers and in all its notices and other official publications from 01/04/2014.
PROVISION RELATED TO DIRECTOR’S
As per companies Act, 2013 a person is allowed to hold directorship in 20 companies only, out of which not more than 10 could be public companies including private ltd companies. if the person is the director in more than the above mentioned limit then he has to resign from the other companies in the excess of above limit
within one year from the commencement of the act.Further director’s of the company has to mention their name & DIN (Director Identification Number) with their signature i.e. all the documents containing the signature of director, director’s name & DIN shall also be mentioned along with their Signature.
PROVISIONS RELATED TO ALLOTMENT OF SHARES
Companies are time bound to allot the shares within a period of sixty (60) days from the date of receiving application. If they fail to allot the shares within prescribed duration then the entire amount should be repaid by companies within 15 days to the respective applicants.
Non repayment within prescribed duration would be considered as default & from the 76th day, the whole application money held by company will be treated as deposit.
Further, application money received by the company for allotment of shares cannot be utilized for any other purpose & a separate bank account shall be maintained for receiving the application money from the applicant & all the transaction related to allotment shall be done through that account only.
In the light of above mentioned provisions, our views are that all the companies shall repay the application money held as on 31/03/2014 before 30th May 2014.
PROVISIONS RELATED TO LOAN FROM SHAREHOLDERS
All the companies who had taken Deposit shall file the return to ROC with 3 months from the commencement of this Act & repay the loan to its shareholders within one year from the date of commencement of this act.
In respect to the above provision amount taken by the company from its shareholder will also cover in the definition of deposit
PROVISION RELATED TO DIRECTORSHIP OF THE COMPANY
From the date of commencement of this Act, Every Company is required to have minimum one resident director. Here resident means “director who stayed in India for 182 days or more in previous calendar year”
For existing companies, company should fulfill the requirement of the resident director within one year from the date of notification.
COMPANY LAW UPDATE 1 6
: CL: Some key highlights of New Provisions applicable w.e.f. April 1, 2014 under Companies Act, 20131. Now, the Appointment of Company Secretary is required only for Public Limited Companies having paid up capital more than 10 Crores whereas Private Limited Companies are exempted from appointment of Key Managerial Personnel.
2. Form MGT 7: Annual Return with exhaustive verification and authentication is mandatory by the Company Secretary in Whole time Practice for all the companies not having a Company Secretary in Employment in Form No. MGT 7 comprising the Registration Details, Name and Location of the Company and other clauses relating to Principal Business Activity of the Company, Particulars of Holding, Subsidiary and Associates Company, Changes in Authorised, Issued, Subscribed and Paid-up Share Capital including Preference Share Capital, Debentures, etc., Turnover and Net Worth of the Company, Shareholding Pattern and changes thereof, Indebtness, Details of Members, Debenture holders, etc. Composition of Board of Directors, Key Managerial Personnel, CFO, Full details of Meeting of Members/Board/Committees of Directors alongwith Attendance particulars, Remuneration details of MD, WTD, Other Directors and Key Managerial Personnel covering particulars of Gross salary, Value of perquisites, Profits in lieu of salary, commission, etc, Details of Penalties/Punishment/Compounding of Offences by company/directors and other officers, Details of Compliances with respect to Returns filed with ROCs, Disclosures of Closure of Register, Declaration of Interim/Final Dividend, Particulars of Inter-corporate Loans, Investments, Contracts in which Directors are interested/related party transaction, Resolutions passed by Postal Ballot, Details of Shares held by or on behalf of FII, Details regarding Corporate Social Responsibility, Limits on Loans and Investments and Restrictions on Powers of Board, etc.
3. THE COMPANY HAS TO FILE FORM MGT 9 WITH THE DIRECTORS REPORT COMPRISING EXTRACTS OF ANNUAL RETURN AS GIVEN IN FORM MGT 7.
4. Form MGT 8: Annual Return Certification is compulsory from Practicing Company Secretary for Listed Companies and the Companies having Paid Up Capital more than 10 crores or Turnover 50 Crores in Form MGT 8.
5. As per Section 204(1) Secretarial Audit in Form MR-3 from Practicing Company Secretary is compulsory for every Listed Company and Public Limited companies having Paid Up Capital more than 50 Crores or Turnover 250 Crores or more. This requires compliances under various other Acts, also namely the Companies Act, 2013, the Securities Contact Regulation Act, 1956, the Depositories Act, 1996, the Foreign Exchange Management Act, 1999 and rules and regulations made thereunder and the Securities and Exchange Board of India Act, 1992 and the rules and regulations made thereunder.
6. As per Section 12(3)(c) every company shall ensure that its name, address of its registered office and the Corporate Identity Number (CIN) along with telephone number, fax number, if any, e mail and website addresses, if any, shall be printed in all its business letters, billheads, letter papers and in all its notices and other official publications. CIN to be printed on all letter heads and printed material of company like invoice etc along with its registered office and corporate office address.
7. Borrowings should be only from Directors. If taken from others then it will be treated as Deposit and Deposit rules have to be followed.
8. Unsecured Loan can be taken from Promoters only if any stipulation is imposed by the Financial Institution or Bank.
9. As per Section 185 Loan to Directors or the companies in which there are common directors or shareholders is prohibited.
10. All companies will have to pass Special Resolution under Section 180 for taking approval from Shareholders for approving
limit of Total loan to be taken from the Financial Institution.
11. As per Section 177 Audit Committee, and as per Section 178 Remuneration Committee and Nomination Committee is required to be constituted in case of Public companies having Paid up capital of Rs. 10 crores or more or the companies having turnover more than Rs. 100 crores or more or having outstanding loans/ debentures/deposit exceeding Rs. 50 crores or more.
12. As per Section 149(4) every Listed Company shall have at least one third of the total number of directors as Independent Directors and every public companies having paid up capital of Rs.10 crores or more or Public companies having turnover of Rs.100 crores or more or Public companies having, in aggregate, outstanding loans, debentures and deposits exceeding Rs.50 crores shall have at least two Independent Director.
13. Consolidation of accounts is mandatory in case of subsidiary or associate companies. Where associates companies are those in which a company having control of 20% or more in share capital of other company.
14. As per Section 135 Corporate Social Responsibility(CSR) the companies having profit more than Rs. 5 Crores in any of the end of Financial Year, the company is required to incur the expenses on CSR equal to 2% of Average profits of last 3 years. For this CSR, Committee of 3 directors is required to be constituted where there will be at least 2 independent directors who will formulate the CSR Policy and the same will have to be published on the Website of the Company.
COMPANY LAW UPDATE 1 5
: IMMEDIATE CONCERN W.E.F. APRIL 1, 2014 W.R.T. COMPANIES ACT 2013
1. Appointment of CS for Public Limited Companies having paid up capital more than 10 Crores whereas Private Limited Companies are exempted from appointment of KMPs
2. Annual Return Certification is compulsory from Practicing CS for the companies having Paid Up Capital more than 10 crores or Turnover 50 Crores in MGT 8 Form
3. Secretarial Audit from Practicing Company Secretary is compulsory for Public Limited companies having Paid Up Capital more than 50 crores or Turnover 250 Crores or more
4. CIN to be printed on all letter heads and printed material of company like invoice etc along with its registered office and corporate office address
5. Borrowing should be only from Directors. If taken from others then it will be treated as Deposit and Deposit rules have to be followed. (Deposit Rules 1 (C)(viii) PAGE 7
6. Unsecured Loan can be taken from Promoters only if any stipulation is imposed by the Financial Institution or Bank namely. {Chapter 5 Deposit Rules 1 (C)(xiii) PAGE 7}
7. Loan to Directors, or the companies in which there are common directors or shareholders is strictly prohibited under Section 185
8. Rotation of Statutory Auditor is required after transition period of 3 years form applicability of Companies Act 2013
9. Auditors can now audit only up to total 20 companies where as public limited companies can be 10 only
10. All companies will have to pass special resolution u/s. 180 for taking approval from Shareholders for approving limit of Total loan to be taken from the Financial Institution
11. Audit Committee, Remuneration Committee and Nomination Committee is required to be constitute in case of Public companies having Paid up capital of Rs. 10 crores or more or the companies having turnover more than Rs. 100 crores or more or having outstanding loans/ debentures/ deposit exceeding Rs. 50 crores or more.
12. At least Two Independent Director are required to be appointed in Public companies having Paid up capital of Rs. 10 crores or more or the companies having turnover more than Rs. 100 crores or more or having outstanding loans/ debentures/ deposit exceeding Rs. 50 crores or more.
13. Consolidation of accounts is mandatory in case of subsidiary or associate companies. Where associates companies are those in which a company having control of 205 or more in share capital of other company.
14. If the companies having profit more than Rs. 5 crores in any of the end of Financial Year, the company is required to incur the expenses on CSR equal to 2% of Average profits of last 3 years. For this CSR Committee of 3 directors is required to be incorporated where there will be at least 2
independent directors who will formulate the CSR Policy and the same will have to be publish over the Website of the Company.
COMPANY LAW UPDATE 1 4
: CL: Secretarial audit be applicable from FY 2014-15: By CS Vinod KothariWill secretarial audit be applicable for the AR to be filed this year? Companies will be preparing and filing annual return, with ref to position as on 31st March 2014, after the AGM. As per sec 204, the annual return in case of listed companies and "specified companies" has to be accompanied by secretarial audit report.
Rule 9 of Appointment and Remuneration of Personnel Rules provides no clarity whether the AR filed after the forthcoming AGM has to be accompanied by the secretarial audit report.
However:
(a) In terms of sec 179 (3), the appointment of secretarial auditor has to be done in a board meeting. This does not surely have to be the first board meeting held in the current year.
(b) Form MR-3 clearly refers to secretarial audit report for a financial year. One of the primary reporting obligations of the secretarial auditor is compliance with Companies Act 2013, which mostly applied only from 1st April 2014.
(c) The secretarial audit report is annexure with the board report. Many companies may be placing their board report soon. Listed companies only have 60 days window.
Clearly, the secretarial audit pertaining to compliances spanning over an entire financial year cannot be completed within days or weeks - it is an effort stretching over a period.
Considering above, we would hold a prima facie view that the secretarial audit report applies on financial year basis, and therefore, applies only for FY 2014-15
COMPANY LAW UPDATE 1 3
: Cl:Observe SS-5 for Minutes effective 1st April, 2014: Mamta Binani Sec 118(10) of the Companies Act, 2013 provides that "every company shall observe Secretarial Standards with respect to general and board meetings specified by the Institute of Company Secretaries of India..."
Sec 118 is notified and shall be in force from 1st April, 2014
Secretarial Standard (SS)-5 on Minutes has already been issued by Institute of Company Secretaries of India, You may please click on the link below to read the same.
COMPANY LAW UPDATE 1 2
: How to file PAS 3 without attaching PAS 5 etc for old allotments under companies Act 1956?
CA Nitesh More Those who have not yet filled Form 2 for allotments made under companies Act 1956, are requested to file new form PAS 3 without attaching PAS 5 etc . but enclosing an attachment that no such attachments are required as allotment have made under companies Act 1956 .
Step 1 fill up PAS 3
Step 2 Attachment with PAS 3: A declaration that no attachments such as PAS 5, valuation report etc. are required as allotment have made under companies Act 1956
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