Compliances of Pvt Ltd To Make 0% Penalties
Compliances of Pvt Ltd Generally, a private limited company is required to comply with certain basic requirements for commencing its business i.e. opening of bank account, obtaining Good and Service Tax (GST) registration or Import Export Code (IEC) and other applicable registrations depending upon the requirements of the business activities. On the contrary, most of the directors or entrepreneur fails to comply with legal compliances leading to hefty penalties and in extreme cases closure of companies by the ministry. A private limited company is required to adhere certain important compliances in accordance with the provisions of the Act, a summarized note on post incorporation compliances is as follows.
1. Convening of first meeting of Board of Directors
A private limited company is required to hold a meeting of board of directors within a period of 30 (thirty) days from the date of incorporation of the company wherein certain agenda items like appointment of first statutory auditors, issuance of share certificate etc. are to be taken up by the company.
2. Appointment of Statutory Auditor
Another important compliance for a private limited company is to appoint an individual or a firm (who are eligible to be appointed as an auditor) as a statutory auditor of the company within 30 (thirty) days from the date of incorporation of the company in accordance with the applicable provisions of the Act.
3.Filing of form for Commencement of Business
A company cannot commence its business activities unless a declaration for commencement of business as per the provision of the Act, is filed within a period of 180 (One Hundred and Eighty) days from the date of incorporation of the company.
A private limited company shall not commence any business or exercise any borrowing powers unless such declaration is filed with the Registrar of Companies. In order to comply with this requirement, the company is required to open a bank account and initial subscribers are required to deposit the subscription monies in accordance with the shareholding ratio between the subscribers as mentioned in the memorandum of association of the company.
4. Issuance of share certificate and payment of stamp duty
A private limited company is required to deliver share certificates to the subscribers to the memorandum of association of the company within a period of two months from the date of incorporation.
The stamp duty on the share certificates must be paid within a period of 30 (thirty) days from the date of issuance of share certificates in accordance with the provisions of Indian Stamp Act, 1899, However, the procedure for payment of stamp duty is prescribed by the respective state governments.
5. Corporate Stationery
It is important for a private limited company company to affix a board depicting companies name, registered office address, corporate identity number, telephone number, email id, website address, if any, outside of every office or place in which its business is carried on, in a conspicuous position and in legible letters.
6. Annual Compliances under the Act
Every private limited company is mandatorily required to undertake certain annual compliances. Irrespective of the paid capital and turnover, every company is required to hold an annual general meeting within 6 (six) months from the close of every financial year and subsequently file the e-Form AOC-4 and e-Form MGT-7/7A with the Registrar of Companies within thirty and sixty days of the annual general meeting, respectively. It is pertinent to note that there is an extended timeline for holding the first annual general meeting of the company and it can be conducted at any time within nine months from the close of the first financial year. it Includes
- Annual Returns: Private limited companies must file their annual returns with the Ministry of Corporate Affairs (MCA). This includes financial statements, director’s report, and auditor’s report.
- Annual General Meeting (AGM): Hold an AGM within six months from the end of the financial year. In the AGM, financial statements are presented, and directors are appointed or reappointed.
- Board Meetings: Conduct board meetings at least four times a year, ensuring that there is a maximum gap of 120 days between two consecutive meetings.
- Income Tax Returns: File income tax returns on time. Private limited companies are required to file their income tax returns by September 30 of the assessment year.
- Statutory Audit: Conduct an annual statutory audit of the company’s accounts by a qualified auditor.
- GST Compliance: If applicable, comply with Goods and Services Tax (GST) regulations and file GST returns regularly.
- Compliance with Labour Laws: Adhere to various labor laws and comply with regulations related to employee provident fund, employee state insurance, and other labor-related statutes.
- Registrar of Companies (RoC) Compliance: Ensure timely filing of various forms and documents with the RoC, such as changes in the company structure, director details, or share capital.
- Maintaining Statutory Registers: Keep and maintain various statutory registers and records, such as the register of members, register of directors, and register of charges.
- Compliance under the Companies Act, 2013: Comply with various provisions of the Companies Act, 2013, such as disclosure of interest by directors, rotation of auditors, and other statutory requirements.
