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Preparation of Statutory Registers (Digital)
Commencement of Business Approval (Digital)
Deliverables scope - period after incorporation till 31-March
Drafting of Notices and Agendas for Board meetings
Drafts for appointment of First Auditor
Printed Share Certificates (20 in Nos)
MoA and AoA (pdf)
Drafting of Board resolutions for meetings
IPro*– basic secretarial data entry done for no time lag
[*Software for Company Law and related compliances]
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What is Incorporation Year?
The year in which a Company is incorporated is the incorporation year. On incorporation, the Company has to hold a Board Meeting within 30 days to appoint First Auditors, issue subscription shares, file for Commencement of Business.
Financials of the Company, where it is incorporated between 1st April till 31st December of a year, will have to be made upto the period ending on the 31st day of March of the following year.
Financials of the Company, where a Company has been incorporated on or after the 1st day of January of a year, will have to be made upto the period ending on the 31st day of March of the following year.
Incorporation Certificate
Memorandum of Association of Company
Articles of Association of Company
Bank Account Details
First Auditor Details
* (All documents in Pdf scanned. Image file in jpeg format)
* (All documents to be Self Attested and signed on each page)
Annual Compliance for the Incorporation Year to be complied by a Company
Collect information and documents
Drafting and Preparation of documents required
Filling of forms
Sending to Company for Certification and uploading
Collation data with Company relating to registers needed to be maintained
Updating Register
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Post Incorporation, a Company has to comply with certain obligations/ compliances imposed by the Companies Act, 2013 . These compliances are either mandatory in nature or are event-based. They are generally as follows:
Event Based
Contd….
Contd…
Mandatory:
Board Minutes Compliances
MGT-14 to be filed for:
By all companies
Only Public Companies
Basic Agenda items for First meeting of the Board of Directors (BOD):
Pursuant to the provisions of Section 173(1), of the Companies Act 2013, the Company will have to hold the 1st meeting of the BOD within 30 days i.e. by 22nd March 2022, from the date of the date of its incorporation.
First Auditor
According to Section 139(6), the First Auditor of the Company has to be appointed by the BOD within 30 days of date of incorporation i.e. by 22nd March, 2022. The term of the First Auditor shall be until the conclusion of the first annual general meeting.
Interest disclosure
Pursuant to the provisions of Section 184(1), of the Companies Act 2013, every director shall disclose his interest in any company/firm/body corporate/association of individuals. Further, any changes in the disclosures already given, has to be intimated to the BOD in the first meeting after such change.
Name Plate etc
Pursuant to the provisions of Section 12(3), of the Companies Act 2013, the Company shall paint/affix its name at all places from where it carries on its business operations. It shall be displayed in the language which is generally used in the locality.
Letterheads etc
Pursuant to the provisions of Section 12(3), of the Companies Act 2013, every Company will 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
Statutory Registers
The company shall be required to maintain statutory registers (like Members Register, Common Seal register, Register of Share Transfer, Index of Members etc.,Investment Register, Directors disclosure etc.) at the registered office of the company. The same shall be maintained in the prescribed form failing, which the company will be subject to penalties.
Share certificate to First subscribers
Pursuant to the provisions of Section 156(4), of the Companies Act 2013, The share certificates shall be issued to the Subscribers to the Memorandum of Association within 2 months from the date of incorporation.
Financial year and first Accounts
Pursuant to the provisions of section 2(41) of the Companies Act, 2013, "financial year", in relation to any company or body corporate, means the period ending on the 31st day of March every year, and where it has been incorporated on or after the 1st day of January of a year, the period ending on the 31st day of March of the following year,
Thus in your case, since the Company has been made after 1st january, the accounts have to be prepared for the period from Date of Incorporation i.e 21st February 2022 till 31st March 2022.
Commencement of business certificate
Pursuant to the provisions of Section 10A of the Companies Act, 2013, a declaration in E-Form 20A has to be filed within 180 days from date of Incorporation, in your case the last date for filing will be 19th August, 2022, once the Subscription money has been deposited into the Bank Account of the Company.
Please let us know when you receive the email for opening of the Bank account from HDFC Bank. We will be sending you an email with documents that will be required for the above matter.
[given timeline depends on receipt of documents from the client and functioning of the Government platform(s)]
Steps for Annual Compliance
Data collection
Forms
Registers
Drafting of Resolutions
Agenda: Items of business to be covered in the First Board Meeting of any Company
On receiving the Certificate of Incorporation of the Company, the first Board Meeting should be held within 30 days to be calculated from the date of incorporation stated in the Certificate of Incorporation.
Ex: if Company incorporated on 2nd February 2021, 30 days from this date will be 4th March 2021. The 1st Meeting should be held by 3rd February since the word used in the Act is ‘within’ and not ‘till’.
The Meetings of the Board of Directors of the Company are governed by the provisions of Companies Act, 2013 read with Secretarial Standards (SS)-1 issued by ICSI.
Companies Act, 2013:
Section 173(1):
Every company shall hold the first meeting of the Board of Directors within thirty days of the date of its incorporation
Section 118(10)
Every company shall observe secretarial standards with respect to general and Board meetings specified by the Institute of Company Secretaries of India constituted under section 3 of the Company Secretaries Act, 1980 (56 of 1980), and approved as such by the Central Government.
Secretarial Standards-1
This Standard is applicable to the Meetings of Board of Directors of all companies incorporated under the Act except One Person Company (OPC) in which there is only one Director on its Board and a company licensed under Section 8 of the Companies Act, 2013
Agenda for 1st Board Meeting will be as follows:
Additional items may be added depending on the Company, and its agenda. At times if an item of business has been missed from the Agenda, the same maybe discussed under the aforementioned Item No.26
The Agenda has to be accompanied with Notes to Agenda. Drafts of the same are available on the following links:
draft Notice, Agenda and notes to agenda- 1st BoDM
or
draft Notice, Agenda and notes to agenda- 1st BoDM- VC.pdf
The WWH of a Company’s Nameplate – Where, What and How
The Companies Act 2013 (the Act), has prescribed in detail the nuances of a Company’s Nameplate. Broadly described, these are covered under 3 major categories: Where, What and How
Let us look at each of them in detail.
Where
The Act states clearly, ‘Every office or every place of work.’ This means any place, from where you conduct your business should have the Nameplate. And thus covers the following:
a. Registered office
b. Corporate Office
c. Branch Office / Any other office
d. Warehouse(s)
e. Store(s) and outlet(s) (Retail)
f. Factory(ies) / place(s) of manufacturing
g. Any other place related to business
What
We have already understood, the ‘where’ Now let us understand the ‘what’? The Act clearly states , we should put the following information
a. Name of the Company
b. Registered Office Address of the Company
c. CIN number of the company
Also remember, the GST Act, 2017 also mandates that any organisation with a GST number, should display its GST number clearly at every place of work. Hence, if your company is registered under the GST Act, 2017, make sure the GST number is also displayed.
How – The Act states: paint or affix. Thus, the Company can have it: either painted/printed directly on the surface of the wall or have it affixed i.e. maybe a plate or a plaque which has all the details and it can be fied to the outer wall.
a. Place: It should be outside the place of work, in a conspicuous position i.e.where people can see it clearly and easily. Thus both location place and position in the place has been stated in the Act.
b. Legibility: All required information should be written in clear legible letters allowing easy readability.
c. Language: The Act clearly states, that it should be in the language or of one of the languages in general use in that locality. Thus the information has to be in the local language. Ex: If English is not the local language, it is not mandatory to display details in English. Writing in the local language is sufficient compliance. But if English is being used which is not the local language, then the information has to be given in one of the local languages too.
Company letterhead - Content is as Important as Design
We spend so much time designing our Company’s letterhead: the logo, the colors, the elements, design, paper quality, so on so forth. that, we often forget the ‘content’ that should be in the letterhead. The Ministry of Corporate Affairs, through the Companies Act 2013, has prescribed certain mandatory information to be printed on every Company’s letterhead and they are as follows:
1. Name of the Company
This is very obvious and needs no explanation. But actually, it does. Where a Company has changed its name or names during the last two years, it shall mention the same along with its current name. Ex.: ABC Informatics Private Limited (Formerly ABC Analytics Private Limited).
The words ‘One Person Company’ should be mentioned below the name of a One Person Company.
2. Address of Registered Office,
Address of the registered office is mandatory. It is a good practice to mention the address of other offices too, like – Corporate Office, Branch Office, Factory sites etc. But registered office is always mandatory.
3. CIN Number
CIN is a 21-digit alpha-numeric Unique number, this number needs to be quoted on letterhead of the company compulsorily.
4. Telephone Number
It is nowhere mentioned, that it has to be telephone number of the registered office. Any Number, even if it’s a Mobile Number can be mentioned.
5. Fax Number (if any)
Fax number, if available can be mentioned. In today’s world, with the advent of emails, Fax has lost its relevance – and hence mention this, only if you have it.
6. E-mail Id
Again, the Ministry has not mentioned any format for this, this can be an email specific to your Company’s domain, or it could be a free email like Gmail or Yahoo. Make it a habit within the Company, to check this email id on a regular basis.
7. Website address (if any)
Mention this if it exists. But if the Company has never built its website, then you could skip this.
The Ministry of Company Affairs (MCA), has not specified where and how each of the information needs to be mentioned. This designing of the letterhead is left to the discretion of the Company.
“Financial Year"
For any company or body corporate*:
means the period ending on the 31st day of March every year.
For a newly incorporated Company:
Where a Company has been incorporated on or after the 1st day of January of a year, the period ending on the 31st day of March of the following year.
Summary:
Thus, every Company or body corporate incorporated in India should follow the f.y. Commencing on 1st April and ending on 31st March, i.e. for 12 months
In the case of a newly incorporated Company, which, if incorporated on or after 1st January of a year, can have its first financial statements prepared for more than 12 months- i.e. a maximum of 15 months.
Remember to use the word ‘period’ in the Board’s Report, Auditors Report and elsewhere, wherever the word ‘year’ is being used alongwith financial statements.
Ex: “The Directors of your Company present the Board’s report for the period (and not f.y) from 1st January 2020 to 31st March 2021….”
Holding/ Subsidiary/Associate Company# :
A company or body corporate*, which is a holding company or a subsidiary or associate company of a company incorporated outside India and is required to follow a different financial year for consolidation of its accounts outside India, the Central Government may, on an application made by that company or body corporate in E-Form RD-1 alongwith required documentation, allow any period as its financial year, whether or not that period is a year:
*Body Corporate
Is ‘body corporate’ different from a ‘company’?
No. Not different but is a ‘larger’ concept as compared to a ‘Company’. Body corporate includes a Company incorporated under Companies Act,2013 of India or any other previous Act and Companies incorporated outside India.
"body corporate" or "corporation"
includes a company incorporated outside India, but does not include—
(i) a co-operative society registered under any law relating to co-operative societies; and
(ii) any other body corporate (not being a company as defined in this Act), which the Central Government(CG) may, by notification, specify in this behalf;
Information:
The Asian Development Bank has been recently notified by the CG excluding it from the definition of body corporate or corporation
Its has been held that a body corporate has 5 distinct attributes:
#"holding company", in relation to one or more other companies, means a company of which such companies are subsidiary companies. The expression "company" includes any body corporate.
#"subsidiary" in relation to any other company (that is to say the holding company), means a company in which the holding company-
● controls the composition of the Board of Directors; or
● exercises or controls more than one-half of the total voting power either at its own or together with one or more of its subsidiary companies
#"associate company", in relation to another company, means a company in which that other company has a significant influence, but which is not a subsidiary company of the company having such influence and includes a joint venture company.
#"significant influence" means control of at least twenty per cent. of total voting power, or control of or participation in business decisions under an agreement;
#"joint venture" means a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement;
When to hold the Company’s Annual General Meeting (AGM)
Every Company, other than a One Person Company (OPC) has to hold an Annual General Meeting (AGM).
The calculation of the date to hold an AGM is like a puzzle. There are certain parameters within which it has to be held.
The parameters are as follows:
Other conditions:
Also, before we begin, it is necessary to understand the concept of financial year for which accounts have to be prepared:
“Financial Year",
For any company or body corporate: means the period ending on the 31st day of March every year.
For a newly incorporated Company: Where a Company has been incorporated on or after the 1st day of January of a year, the period ending on the 31st day of March of the following year.
1st AGM:
A newly incorporated Company has to hold its first AGM within a period of nine months from the date of closing of the first financial year of the Company, alongwith complying with all the ‘Other Conditions’ as stated above.
Further, if the Company holds its first AGM as aforesaid, it shall not be necessary for it to hold any AGM in the year of its incorporation.
Thus, the above three parameters are not applicable on the 1st AGM of a Company.
Case Study 1:
When should a Company incorporated on 3rd January 2020, hold its 1st AGM - in the year 2020 or 2021?
The Company has 2 options.
Option A:
It can prepare its Accounts for the period from 3rd January 2020 to 31st March 2020. Therefore, the Company can hold its 1st AGM latest by 31st December 2020.
Option B:
It can prepare its Accounts for the period from 3rd January 2020 to 31st March 2021. Therefore, the Company can hold its 1st AGM latest by 31st December 2021.
Case Study 2:
When should a Company incorporated on 3rd April 2020, hold its 1st AGM?
The Company has to close its accounts on 31st March 2021. Therefore, the Company can hold its 1st AGM latest by 31st December 2021.
Subsequent AGMs
All the above three parameters have to be complied with to convene a valid AGM, alongwith complying with all the ‘Other Conditions’ as stated above.
Case Study 3:
The Company held its previous AGM on 15th July 2019. When should the Company hold its AGM in 2020?
1st Parameter: Period between 2 AGMS should not exceed 15 months.
Thus, the Company can hold the AGM latest by 15th October 2020.
2nd Parameter: Accounts should be adopted in the AGM within 6 months of the close of the f.y.
Since Accounts have been closed on 31st March 2020 and they have to be adopted within 6 months of their closure, the AGM will have to be held latest by 30th September 2020.
3rd Parameter: An AGM should be held once in every calendar year.
The Company can hold on any date latest by 31st December 2020.
Thus, based on the above the AGM can be held on three differing dates, but only 1 date fits all three parameters, that date being 30th September 2020. 15th October does not satisfy the 2nd parameter nor does 31st December 2020.
Case Study 4:
The Company held its previous AGM on 23rd June 2019. When should the Company hold its AGM in 2020?
1st Parameter: Period between 2 AGMS should not exceed 15 months.
Thus, the Company can hold the AGM latest by 23rd September 2020.
2nd Parameter: Accounts should be adopted in the AGM within 6 months of the close of the f.y.
Since Accounts have been closed on 31st March 2020 and they have to be adopted within 6 months of their closure, the AGM will have to be held latest by 30th September 2020.
3rd Parameter: An AGM should be held once in every calendar year.
The Company can hold on any date latest by 31st December 2020.
Thus, based on the above the AGM can be held on three differing dates, but only 1 date fits all three parameters, that date being 23rd September 2020. 15th October does not satisfy the 1st parameter nor does 31st December 2020.
What is the process to call a Board Meeting?
All the Directors of the Company together form the Board of Directors of the Company. The Company is run by this Board of Directors. All decisions are taken by passing resolutions at Meetings that are duly called and attended. At times the shareholders of the Company’s approval are also required for certain decisions. Please refer to our write up on Board’s powers and Items requiring Shareholders approval
Therefore, it is important to know and understand how a Board Meeting can be called.
Who can call a Board Meeting:
The Companies Act, 2013 is silent on who can call a Board Meeting. As per SS-1 Any Director of a company may, at any time, summon a Meeting of the Board, and the Company Secretary or where there is no Company Secretary, any person authorised by the Board in this behalf, on the requisition of a Director, shall convene a Meeting of the Board, in consultation with the Chairman or in his absence, the Managing Director or in his absence, the Whole-time Director, where there is any, unless otherwise provided in the Articles.
The First Meeting of the Board of Directors can be called by any of the First Directors of the Company, immediately on receipt of the Certificate of Incorporation to transact the business as required. Please refer to Agenda: Items of Business to be covered in the First Board meeting of a Company.
How will a Board Meeting be called:
The Meeting has to be called by sending a Notice in writing. To refer to the contents of a Notice for a Board Meeting please refer to our write up on Board Meeting Notice- Dos and Don'ts. This Notice has to be sent at least seven days before the scheduled Meeting or as stated in the Articles of the Company.
The Board Meeting can also be called at a shorter Notice, i.e. less than 7 days or as prescribed by the Articles, to transact urgent business. If the Company has Independent Director(s) on board, then at least one independent director has to be present at such a meeting.
To Whom and Where to send the Notice:
The Notice shall be sent to every Director of the company to the postal address or e-mail address, registered by the Director with the company or in the absence of such details or any change thereto, any of such addresses appearing in the Director Identification Number (DIN) registration of the Director.
How shall the Notice to sent
It shall be sent by hand or by speed post or by registered post or by facsimile or by e-mail or by any other electronic means.
Where a Director specifies a particular means of delivery of Notice, the Notice shall be given to him by such means. However, in case of a Meeting conducted at a shorter Notice, the company may choose an expedient mode of sending Notice.
How many Board Meetings should be held in a year?
On receiving the Certificate of Incorporation of the Company, the first Board Meeting should be held within 30 days to be calculated from the date of incorporation stated in the Certificate of Incorporation.
Thereafter a Company requires to hold a minimum number of four meetings of its Board of Directors every year in such a manner that not more than one hundred and twenty days shall intervene between two consecutive meetings of the Board.
In general practice, Companies divide the financial year into 4 quarters:
April to June
July to September
October to December
January to March
One meeting is held in every quarter and the next meeting is so scheduled that not more than 120 days elapsed between 2 meetings.
So what we understand is that a minimum of 4 meetings have to take place in a financial year. A Company may call as many Board Meetings as are required for it to function property.
Exceptions:
A One Person Company, small company and dormant company* are required to hold a minimum of one meeting of the Board of Directors in each half of a calendar year.
The gap between the two meetings should not be less than ninety days.
The above provision is equally applicable in case of a private “start-up Company”*. (MCA Notification G.S.R. 583(E) dated 13th June, 2017)
If more than two Meetings are held in a year where the gap between the first and the last Meeting in a year exceeds 90 days then it would be sufficient compliance of the requirement.
Illustration
In case a small company holds the first Meeting of the Calendar Year 2015 on 1 st June, 2015, it would be sufficient if it holds one more Meeting on any day before 31st December, 2015, but on or after 30th August 2015. If it holds the next Meeting on 30th July, 2015, it should hold at least one more Meeting on or after 30th August, 2015, but before 31st December, 2015
*Definitions:
"One Person Company" means a company which has only one person as a member
“small company" means a company, other than a public company,—
(i) paid-up share capital of which does not exceed fifty lakh rupees and
(ii) turnover of which as per profit and loss account for the immediately preceding financial year does not exceed two crore rupees
Provided that nothing in this clause shall apply to—
(A) a holding company or a subsidiary company;
(B) a company registered under section 8; or
(C) a company or body corporate governed by any special Act;
“Dormant company” means where a company is formed and registered under the Companies Act, 2013 for a future project or to hold an asset or intellectual property and has no significant accounting transaction, such a company or an inactive company may make an application to the Registrar for obtaining the status of a dormant company.
“inactive company” means a company which has not been carrying on any business or operation, or has not made any significant accounting transaction during the last two financial years, or has not filed financial statements and annual returns during the last two financial years;
“start-up company” means a private company incorporated under the Act and recognised as start-up in accordance with the notification issued by the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry.
Board Meeting Notice- Dos and Don'ts
Written not oral
Notice of a Board Meeting has to be given in writing. It cannot be oral.
To whom and How
Notice of every Meeting shall be given to every Director by hand or by speed post or by registered post or by facsimile or by e-mail or by any other electronic means.
Where a Director specifies a particular means of delivery of Notice, the Notice shall be given to him by such means.
Where
The Notice shall be sent to the postal address or e-mail address, registered by the Director with the company or in the absence of such details or any change thereto, any of such addresses appearing in the Director Identification Number (DIN) registration of the Director.
Who will issue
The Notice has to be issued and signed by either the Company Secretary of the Company, or where there is no Company Secretary, any Director or any other person authorised by the Board for this purpose.
When to issue
The Notice of a Board Meeting has to be given even if Meetings are held on pre-determined dates or at pre-determined intervals.
Notice convening a Meeting shall be given at least seven days before the date of the Meeting, unless the Articles prescribe a longer period.
Shorter Notice:
To transact urgent business, the Notice, Agenda and Notes on Agenda may be given at shorter period of time than stated above, if at least one Independent Director, if any, shall be
present at such Meeting.
In such cases, the company may choose an expedient mode of sending Notice.
Contents
The Notice shall specify the serial number, day, date, time and full address of the venue of the Meeting.
The Notice shall inform the Directors about the option available to them to participate through Electronic Mode and provide them all the necessary information if such an option is made available.
The Agenda, setting out the business to be transacted at the Meeting, and Notes on Agenda shall be given to the Directors at least seven days before the date of the Meeting, unless the Articles prescribe a longer period.
Each item of business requiring approval at the Meeting shall be supported by a note setting out the details of the proposal, relevant material facts that enable the Directors to understand the meaning, scope and implications of the proposal and the nature of concern or interest, if any, of any Director in the proposal, which the Director had earlier disclosed.
Each item of business to be taken up at the Meeting shall be serially numbered in the Agenda to the Notice.
Any item not included in the Agenda may be taken up for consideration with the permission of the Chairman and with the consent of a majority of the Directors present in the Meeting.
Caption
Corporate Identification Number (CIN) is a 21 digits alpha-numeric code issued to companies incorporated within the country on being registered by the ROC situated in different states across India under the MCA. CIN is provided to all companies registered in India.
Importance Of CIN - CIN is used for tracking all the aspects and activities of a company from its incorporation by the ROC and is required to be provided on all the transactions with the respective ROC.
Example -
|
Particulars |
Reliance Industries |
SeedUP |
|
The first character of CIN reveals whether a company is “Listed” or “Unlisted” |
L - Listed |
U- Unlisted |
|
The next set of 5 numeric digits categorizes the economic activity of a company: It is based on the National Industrial Classification NIC Code First 2 numbers: Division Third digit- Group Fourth Digit- Class Fifth- Sub Class |
17- Manufacture of Textiles 1-Spinning, weaving and finishing of textiles. 1--Sub Class-Preparation and spinning of textile fiber including weaving of textiles (excluding khadi/handloom) 0- to complete five digits (added as an extra) |
74-Other business activities 9-Business activities n.e.c. 9- Class-Other business activities n.e.c.[This class includes service activities generally delivered to commercial clients] 9- Sub Class-Other business activities n.e.c. |
|
The next 2 letters denote the Indian state where the company is registered. |
MH - Maharashtra |
WB - West Bengal |
|
The next set of 4 numeric digits signifies the year of incorporation. |
1973 |
2020 |
|
The next 3 letters denote the company classification. |
PL C- Public Company |
PT C-Private Company |
|
The remaining 6 numeric digits denote the registration number provided by ROC. |
019786 |
237517 |
Documents Required
Incorporation Certificate
Memorandum of Association of Company
Articles of Association of Company
Bank Account Details
First Auditor Details
Any other matter that has been approved
