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Pankaj Tyagi
| Updated: 06 Nov, 2021 | Category: Compliances

Is it necessary for a private company to comply with the ROC compliances post-incorporation?

private company to comply with the ROC compliances post-incorporation

Running a private company with all requisite compliances is equally intricate as running a Public Limited Company. Over the years, the company incorporation process has been made simpler. It encourages the companies including Private Company to meet all the Compliance post-incorporation. To enhance transparency, every Company including a private company registered under the Ministry of Corporate Affairs shall follow the requisite compliance. However, it is the responsibility of the directors to make sure that all the necessary Compliance post-incorporation has duly complied. This write-up pens down the mandatory compliances to be followed by the Private Company post-incorporation.

Mandatory compliance post-incorporation for Private Limited Company-

In the Case of a Private company, Mandatory compliance post-incorporation includes appointment, qualification, and remuneration, of directors of the Company. The mandatory compliances post-incorporation also include-

  • Conducting the Director’s and Shareholder’s Meetings.
  • Preparation and recording the Annual accounts and,
  • Preserving the necessary documents.

Below-mentioned are the compliances that a private company needs to comply with post-incorporation-

1. Conducting a Board Meeting

Every Private Limited Company post incorporation shall hold its Board meeting within 30 days post-incorporation. After thefirst meeting, a minimum of 4 Board Meetings shall be held every financial year. However, a gap shall not be more than 120 days between two successive meetings.

Who can hold the First Board Meeting?

Any Director of a company may, at any time, can call the Board Meeting. Also, on the requisition of a Director, the Company Secretary, or in case of absence of Company Secretary, the authorized person by the Board of Directors shall hold a Board meeting. The Board meeting shall be held in consultation with the Chairman or in the absence of Chairman, the Managing Director or Director of the Company is authorized to hold the meeting.

Checklist to follow before conducting the Board Meeting-

  • Notice of the meeting to the Directors of the Company.
  • Appointment of Chairman.
  • Proper Quorum.
  • Disclosure of items to be discussed in the Board meeting.
  • Preparing the Attendance Register.

2. How to hold an Annual General Meeting

Holding an Annual General Meeting is one of the mandatory compliances post-incorporation to be followed by the Private company. Every Private Limited Company is required to hold an Annual General Meeting where every shareholder and stakeholder gets an opportunity to meet every year and discuss matters relating to the Company. An Annual general meeting gives an overview of what steps a company shall make which will be beneficial for the shareholders. The meeting must be held at the registered office of the company and also it should be conducted during working hours.

Basis of holding an Annual General Meeting-

The first meeting shall be held within 9 months from the date of closing of the 1st financial year of the Company.

The Subsequent AGM shall be held within 6 months from the date of closure of the financial year.

Note: As per the “Secretarial Standard issued by the ICSI” every company shall necessarily observe the Secretarial standards concerning the Board Meetings and General Meetings.

Checklist to be complied with before conducting the Shareholder’s Meeting-

  • Notice to the shareholders about the AGM
  • Particulars of the Meeting.
  • Confirmation of Appointment of Chairman.
  • Requisite Quorum.
  • Details of the business items to be discussed in the Shareholder’s meeting.

3. Appointment of Auditor

The First Auditor shall be appointed by the Board of Directors, within 30 days from the Date of Incorporation. In case of failure, the members shall appoint the First Auditor within 90 days of the Extra-Ordinary General Meeting.

A company shall inform the Registrar of companies (ROC) in Form ADT-1 about the appointment of an auditor in a manner prescribed under section 139 (1) of the new companies act 2013. 

As per the Companies act 2013, a company shall communicate with the auditor about the appointment and ask for written consent and also form ADT-1 shall be filled within 15 days from the first board meeting.

Note: The first Board is required to be held within 30 days from the date of its incorporation.

Attachments required for Filing ADT-1

The Below-mentioned attachments are required for filing Form ADT-1

  • Copy of Board Resolution duly certified by the Directors
  • Written consent from the auditor to be appointed.
  • Copy of intimation letter to the auditor.
  • Declaration from the Auditor that he/she/it is not disqualified to be appointed as an Auditor u/s 141.

4. Registered Address

The Registered Address of the Company is required to receive all official communication from the various authorities. As per the Companies Act, 2013, a company (Whether Private or Public) shall have a registered office within 15 days from the date of incorporation. The Company shall intimate the same to the ROC within 30 dayspost-incorporation.

Also, the Companies including Private Company shall affix its name at all places from where it executes its business operations. The Company’s name along with the registered address shall be published in the vernacular language. 

5. Unveiling of Director’s Interest-

As mentioned in section 184(1) of the Companies Act 2013[1], Every director at the first Board meeting of the company shall disclose his/her interest in-

  • Any company,
  • Firm,
  • Body corporate,
  • Association of individuals.

 Any changes in the disclosure of Interest shall be informed to the board in its first Board meeting held during each financial year.

Note: In case of an appointment ofan independent director, he/she must give a declaration that he meets the criteria of independence during his/her first board meeting as a director.

6. Filing of AOC-4 and MGT-7

Every Company including Private Company shall file AOC-4 and MGT-7 to the ROC. Filing of Financial Statement through Form AOC-4 discloses all the financial transactions done by the company in the financial year. Form AOC-4 shall be filed within 30 days from the date of AGM. Form AOC-4 shall include-

  • Balance Sheet and disclosure of the particulars of the Balance Sheet.
  • Profit and Loss.
  • Cash flow statement (If any).
  • Particulars of CSR.
  • Details of Related party transactions.
  • Details of Auditors and Auditors report.

Also, every company has to file form MGT-7 within 60 days from the date of holding the Annual General meeting.MGT-7 shall contain the following information-

  • Particulars of the Board and shareholders meeting. 
  • Details of Registered office and principal place of business of other holdings and associate companies.
  • Shareholding pattern 
  • Disclosure of shares, Debts, and other securities and any changes that occurred during the financial year.
  • Disclosure of change in Debenture holders/shareholders.
  • Disclosure of Key managerial personnel, directors, and promoters along with the changes during the year.
  • Remuneration of Directors and KMPs of the Company.
  • Particulars of the legal matters
  • Particulars of any penalty or fine imposed on the company
  • Liability or indebtedness
  • Authentication of compliance matters.

7. Maintenance of Register

Maintaining Register is also one of the compliances post-incorporation i.e. every Private Company shall maintain the statutory registers like the register of Board meetings, Annual General Meetings, and various meetings held in the company. The company shall maintain the minutes of every meeting. A Private company must prepare their books of account and get them audited by the CA at the end of every financial year.

Conclusion

In addition to the Mandatory compliance post-incorporation, the Private companies shall also comply with the non-mandatory compliances like GST Payment, GST Filing, Filing of TDS and TCS, Filing of Tax Audit reports, and Tax audits, etc. In case of any default, the Company and the Officers in Default shall pay the fine for the default period. Also, in case of delay, Additional fees have to be paid by the company.  Hence, every company including a private company should comply with mandatory compliances post-incorporation.

Read our article:Exciting Benefits of Private Company Registration That You Can’t Ignore!

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Pankaj Tyagi

Pankaj has a diverse experience of writing research papers, blog, and articles during his college time. Earlier, he was working as a tax consultant in a financial firm, but his interest in writing drives him to pursue a career in the writing field.

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