TAXAJ - TAXAJ Knowledge Base #Ministry of Corporate Affairs

Indian Subsidiary Company Incorporation

Wed, 11 Oct 2023 17:33:58 +0530

India Business Setup - Setting up a Subsidiary

Welcome to TAXAJ, your trusted partner for seamless and hassle-free business setup in India. Expanding your business by registering a subsidiary company in India is a strategic move that promises many advantages. With its vast market potential, burgeoning middle class, improved regulatory climate, access to a diverse talent pool, government incentives, and more, India offers a compelling proposition for business growth.

However, unlocking these benefits comes with its set of challenges. Navigating the Indian business landscape requires a deep understanding of local regulations and the ever-evolving business environment. This is where TAXAJ steps in, offering our expertise to simplify the complex process.

At TAXAJ, we are dedicated to helping you seamlessly establish your presence in India. Our team of legal and business experts is committed to making your subsidiary setup hassle-free, ensuring that you can focus on growing your business.

Lets dive into the detailed process and steps to Incorporate a Subsidiary Company in India.

Step 0: Minimum Requirements for an Indian Subsidiary/Company

Directors: Minimum Two Directors are required to incorporate a Private Limited Company in India. Both should be Individuals and at-least one of whom should be a Resident of India. (A resident of India is a person who has stayed in India for at-least 182 days in the previous year).

Shareholding: Companies Act, 2013 requires that a Private Limited Company have a Minimum of Two Shareholders. There is no condition for residential status of shareholders. Shareholders can be either individuals or entities or a combination of both. In case of Foreign Holding Company, the Authorised Person of Foreign Entity can not hold shares in his Individual Capacity.

Wholly Owned Foreign Subsidiary: 100% Foreign Shareholding is possible in an Indian Subsidiary with a Minimum of Two Shareholders.

Registered Address: A Registered Address is mandatory for any legal entity to be incorporated which we also call as Corporate Address, this can be a physical office or a Virtual Office for Incorporation purpose and later on shifting to a Physical Office to save time.

Step 1: Receipt of Documents from Foreign Stakeholders

The next step towards Incorporating a Legal Entity in India is Receiving Complete Set of Documents from Foreign Stakeholders which can be explained below:

1. Passport Copy as a Identity Proof

2. Business Visa (if visiting India)

3. Driving License as an Address Proof

4. Bank Statement/Mobile Bill as a Residency Status Proof. (Latest Month's)

4. Passport Size Photograph

5. Valid Phone Number & Email Address

6. Father's Name of Foreign Stakeholder

If Foreign Entity is going to hold the shares of Indian Company then additional documents for Foreign Entity required:

1. Apostille Copy of Resolution of Foreign Company Mentioning the name of Authorized Representative, Number of Subscription of Shares.

2. Apostille Copy of Charter of Foreign Company (MOA, AOA, Certificate of Incorporation or any other Equivalent Document as per the Country of Incorporation).

3. Apostiled Copy of ID Proof of Authorised Representative, if such person is Non-Resident of India

- If the documents are in any other language other than english, then it must be transcripted/translated to english; that transcripted copy along with the original must also be apostilled by the Indian Embassy in their country (If they are not visiting India for Incorporation).

- All the documents for foreign citizens should be apostilled by the Indian Embassy in their country (If they are not in India).

- All the documents for foreign citizens should be apostilled by their own country's Embassy in India (If they are in India).

Step 2: Receipt of Documents from Resident Indian Director

The next step towards Incorporating a Legal Entity in India is Receiving Complete Set of Documents from Indian Stakeholder which can be explained below:

1. PAN Card as a Identity Proof

2. Aadhar Card as an Address Proof

3. Bank Statement/Mobile Bill as a Residency Status Proof. (Latest Month's)

4. Passport Size Photograph

5. Valid Phone Number & Email Address

- All Documents needs to be Self Attested, meaning Signed by Self.

Step 3: Application of Name Reservation for Company

The Registrar of the Companies (ROC) across Indian expects the applicant to follow certain criteria while Naming a Company. The approval is also subject to the officer handling the application. The more closely the rules that are listed are followed the better are th4e chances of getting the name of the Company approved.

Uniqueness: The name of the company is a unique component. A name once registered won't be allocated to another company. This name needs to be descriptive For example if the company is a finance company, the word "Finance" should be included in the name. This word describes the nature of the company. So if the company is in the Logistic or restaurant business they cannot have "Finance" in the name.

Avoid abbreviations: Abbreviations, adjectives and generic words will be rejected. The words banks, exchange, and the stock exchange should be approved by RBI.

Trademark: Proposed company name cannot infringe on a registered trademark or an application for registration of a trademark unless the consent of the registered trademark owner or trademark applicant is submitted along with the name approval application.

Patronage: Proposed company name cannot imply association or connection with or patronage of a national hero or any person held in high esteem or important personages who occupied or occupying important positions in Government. The proposed name cannot imply an association with the Indian or Foreign Government.

Block your domain name: An applicant must block the domain name to avoid duplication.

Regulatory approval: The name of the company which has words like insurance, bank, stock, exchange, venture capital, asset management, mutual fund, etc may require regulatory approvals from RBI, SEBI, IRDAI, etc.

Step 4: Drafting of Incorporation Documents

Apart from the Shareholder's Documents additional details are also needed for incorporating a legal entity in India which are discussed below:

1. Utility Bill for the Virtual/Registered Office of the Company (Latest Month's)

2. Rent Agreement for the Virtual/Registered Office of the Company (If Rented)

3. No Objection Certificate for the Virtual/Registered Office of the Company (If Owned)

4. Total Authorised Capital of the Company

Known as the Registered Capital or Nominal Capital of the Company, Authorised Capital is the Maximum Amount of Share Capital that a company is allowed to issue to its shareholders as per its constitutional documents. Shares are defined as the financial instruments that form units of the overall capital. It is used to raise funds from the general public.

5. Total Paid Up Capital of the Company

Paid-up capital is the amount of money received by the company when it issues or sells its shares to the shareholders and investors. In other words, it is the money that the investors give to the company on buying a share in that company and this amount has to be deposited into the company's bank account within 180 days of Incorporation of Legal Entity in India which can thereafter be withdrawn and used for business purposes.

6. Shareholding or Ownership Ratio of the Company: Shareholding Ratio means for each Shareholder, the ratio of the number of the Shares held by each such Shareholder bears to the total number of the Shares then issued and outstanding.

7. Main Objects/Activities of the Company

The Main Object Clause of MOA defines the Scope of a Company’s Business Activities. The Object Clause is the one of the 6 clauses a Company’s Memorandum of Association contains, that aims to define the primary business activities of a Company. The company is restricted to conduct only those activities which are mentioned in the Object Clause. So, to expand and alter the scope of its activities, a company will have to first change the object clause of its MOA. Understanding the process of changing the Object clause is thus, quite crucial in this context.

8. Passport of Witness for Memorandum & Articles of Association: Details of One Witness shall be required for Memorandum of Association & Articles of Association who needs to be resident of the same country from where the Stakeholder's belong.

Step 5: Getting Documents Apostille & Notarised from Indian Embassy

An apostille is a certificate that authenticates a document to be used in proceedings in a foreign country. An apostille guarantees the authenticity of a document signature and any notarial stamps/ seals affixed to the document. Apostilles are attached to the original document they are certifying and ensure that the certification will be accepted in any other countries that are members of the Hague Apostille Convention.

Apostilles are used to ensure that notarized legal documents are recognized as valid across borders. While every country has its own set of laws and procedures for notarizing documents, apostilles provide an international guarantee that these requirements have been met.

Apostilles are issued either by the Secretary of State from the state in which it originated or by the U.S. Department of State when federal documents are involved or by the Indian Embassy in respective country in which project is required/documents are to be verified.

List of Documents to be Apostille:

Personal Documents

1. Passport Copy as a Identity Proof

2. Business Visa (if visiting India)

3. Driving License as an Address Proof

4. Bank Statement/Mobile Bill as a Residency Status Proof.

To Be Prepared By TAXAJ

5. Memorandum of Association of Indian Company

6. Articles of Association of Indian Company

7. Not Having PAN Declaration of Foreign Stakeholders

8. DIR-2 of Foreign Stakeholders

9. INC-9 of Foreign Stakeholders

If Foreign Entity is going to hold the shares of Indian Company then additional documents for Foreign Entity required:

10. Apostille Copy of Resolution of Foreign Company Mentioning the name of Authorized Representative, Number of Subscription of Shares.

11. Apostille Copy of Charter of Foreign Company (MOA, Certificate of Incorporation or any other equivalent document as per the country of Incorporation).

12. Apostiled Copy of ID Proof of Authorised Representative, if such person is Non-Resident of India

Step 6: Applying for Digital Signature Token (DSC) for Stakeholders

Digital Signature Certificate has now become a prominent digital tool for the signing of personal or essential documents, records, and forms. Hence it is a tool for digitally signing the documents and forms to be filed with Ministry of Corporate Affairs for Incorporating a Legal Entity in India and also for compliances after that its used on regular basis for day to day business tax management.

Steps For Creation of Digital Signature Token

1. Sharing of One Time Password on Email or Clicking on "Verify Email" Option sent on Email while DSC Process.

2. Completing Video Verification

Open the e-mail received for video recording on your Smart Phone or Computer.

Record video using camera on smartphone or computer.
Read the statement shown on screen - loud and clear.
Show documents to camera - Original Passport and Driving License (Both Sides)
Applicant Face must be visible
Duration of video will be for 30 seconds
Click Upload after Completion.

Once done you will get rejection/approval email will be received, if its Rejected then try again and if its Approved the Cheers!

Step 7: Receipt of Apostille Documents from Foreign Stakeholders

Once the Apostiling process is done please share the scanned copies of the same over the email to connect@taxaj.com and courier the physical copies in 2 sets to our Registered Address mentioned in Footnote. The apostiled documents shall also be needed for bank account opening process thereafter.

This way we can continue the process without any delay.

Step 8: Filing of Incorporation Forms with Ministry of Corporate Affairs

As soon we receive the scanned copies of apostille documents, we shall be filing the same with Ministry of Corporate Affairs which takes usually 2-7 working days for processing and issuing the Incorporation Documents such as Certificate of Incorporation, Pan Card, TAN Number and related documents.

Step 9: Immediate Post Incorporation Compliances

Once the Company is Incorporated then next step is completing the Immediate Post Incorporation Compliances which are as mentioned below:

Step I : Opening of Bank Account of Company.

Step II : Receipt of Subscription Money from Foreign Subscriber.

Step III : Filing of e-Form 20A – Declaration of Commencement of Business. (Within 180 Days of Incorporation)

Step IV : Collect FIRC Certificate from the Bank as per FDI Guidelines.

Step V : Issue Share Certificate to the subscribers.

Step VI : File FCGPR with RBI as per FDI Guidelines. (Within 30 Days of Incorporation)

Step VII: Appointment of Statutory Auditors for the Company (Within 30 Days of Incorporation)

Step 10: Regular Post Incorporation Compliances

After a business gets registered there is a long list of Compliances like maintaining Books of Accounts, Filing of Tax Returns, GST Returns, TDS returns, Secretarial Compliances and so on.

Taxation & Accounting

Preparation of Books of Accounts (Balance Sheet, P&L, Cash Flow statement).
Income Tax Returns Filing.
GST Returns.
TDS Returns.
Support in Statutory Audit of Accounts.

Secretarial Services

Filing of Annual Company Returns.
Maintenance of Statutory Registers and Records .
Preparation of Director’s Report and Board Report for Annual General Meeting and Board Meetings as mandated by MCA.
Expert Advisory for the year.
Any Additional Filings shall be on Ad-Hoc Basis as and when needed.

Payroll Compliances

Personal Income Tax Return filing of all the Directors
Employees Salary Structure & Pay Slips Preparation for Optimum Tax Savings
Employees applicable Taxes calculation & payment on Monthly Basis as EPF, TDS, ESI, Professional Tax, etc.
Employees applicable tax returns filing on Monthly/Quarterly Basis such as EPF, TDS, ESI, Professional Tax, etc.
Form 16 Generation at the end of the year

Additional Licenses or Compliances may be applicable depending upon the nature of company or business activities.

Talk To Us To Help You Launch Your Legal Entity in India

How to make Rights Issue of Shares

Thu, 29 Sep 2022 20:10:08 +0530

How to make Rights Issue of Shares

Convene the First Board Meeting: The Board meeting is held, and the resolution for issuing rights shares is passed. The rights issue does not require the approval of shareholders, and hence the board can proceed towards the issue. Here's more that you should know:

Get Started Now

The Nidhi Company (Amendment) Rules 2022

Sun, 18 Sep 2022 22:52:58 +0530

The Nidhi Company (Amendment) Rules 2022

The followings are the said amendments made under the Nidhi Company (Amendment) Rules 2022:

Branch

The definition of the Branch has been inserted. According to this rule, Branch means a place other than the registered office of Nidhi Company.

Deposit Raised By The Company

No company shall raise the deposit for any member or gives a loan to any of its members if:

It does not comply with the rules or requirements of Nidhi Company New Rules,

if the application in Form NDH -4 has been rejected by the central government,

However, not anything written under these rules shall apply to the company incorporated on or after the commencement of these Nidhi Company Amended Rules.

Declaration Of Nidhi Company

Any public company wanting to be declared as a Nidhi company shall apply in Form NDH-4 within a period of 120 days from the date of its incorporation for declaration as a Nidhi company, after fulfilling the following conditions:

(i) it has not less than 200 members;

(ii) it has Net owned Funds of Rs. 20 lacs or more

After examining the application, the central government conveys its decision within 45 days to the company, and if it fails to do so within 45 days, it will be deemed to be approved.

When the central government gets satisfied that the company meets all the requirements, then it will notify it as Nidhi Company or Mutual Benefit Society in the official gazette. However, the company shall commence its business only if the central government approves its application.

Fit And Proper Person

The company shall attach a declaration with regard to the fulfilment of fit and proper person by all of its directors and promotors with the Form NDH-4.

To determine that any promoter or director is a fit and proper person, the following criteria should be looked upon:

(a) Integrity, honesty, ethical behaviour, fairness, reputation and character

(b) Not incurring any of the following disqualifications:

(i) Any complaint or information under section 154 of CrPC has been filed or is pending against him

(ii) Chargesheet filed against him in the matter of economic offences

(iii) Restraining, prohibition or department order has been passed against him in any matter related to company law, securities law or financial market in force

(iv) Conviction order passed against him involving moral turpitude

(v) Declared involvement and not been discharged

(vi) Unsound mind

(vii) Wilful defaulter

(viii) Fugitive economic offender

(ix) Director of five or more companies

(x) Such person is the director in five or more than five; or promoter in three or more than three Nidhi Companies

Minimum Paid-Up Share Capital

In the amendment, the minimum paid-up share capital has been raised from 5 lakhs to 10 lakhs.

Rules For An Existing Company

Nidhi company existing on the date of enforcement of Nidhi Company New Rules shall comply with all the requirements within a period of 18 months from the date of such enforcement.

Rule 5 Of Nidhi Rules

Rule 5 talks about the minimum number of members, Net owned fund, etc., and in the amendment, it has been mentioned that it will not be applicable for the companies incorporated as Nidhi Company on or after the enforcement of Nidhi Company New Rules 2022. So, the requirement of filling of application in Form NDH 1 within 90 days from the incorporation of the company shall not be applicable to the companies incorporated on or after the enforcement of new Rules.

Restrictions On Nidhi Company

In the new rules, it has been stated that the Nidhi Company shall not raise loans from the banks or any financial institutions or any other source to advance the loans of its members.

Another restriction given to Nidhi Company is on acquiring or purchasing securities or controlling the composition of the Board of Directors of any other company or from entering into an arrangement for the change of its management.

Transfer Of The Shares

Any member shall not transfer more than 50% of their shares during the subsistence of such loan or deposit. However, members shall retain the minimum number of shares required.

Net Owned Funds

The requirement of Net owned funds for Nidhi company has been changed from 10 lakhs to 20 lakhs.

Opening Of Branches

In case a Nidhi company wants to open more than three branches outside the district or any branch outside the district, then it shall now have to apply in Form NDH 2 along with the fee as required under the Companies (Registration Offices and Fee) Rules, 2014 and intimate about such opening to the Registrar within 30 days from the opening. However, it cannot open branches unless it has filed its financial statement or annual return to the Registrar. And, it shall not open its Branch outside the state where its registered office is situated.

Closing Of Branches

A Nidhi company shall not close any branch unless the proposal to close the Branch with the plan of how the existing deposits shall be paid and how the existing loan shall be recovered is approved by the Board of Directors in the meeting and has obtained the prior approval of Regional Director as per the Companies (Registration Offices and Fee) Rules, 2014. The regional director shall pass the order of approval within 30 days of the application. After obtaining approval from Regional Director, the Nidhi Company shall publish in the local newspaper at the place of its business prior to 30 days of such closure, and it shall also fix a copy of the information of closure on the notice board of Nidhi Company for a period of thirty days since the day of such publication and give an intimation to the Registrar within 30 days of such closure. Also, any place which is not a registered office or Branch where a Nidhi Company carries its business shall be closed within a period of 6 months from the date of enforcement of Nidhi Company (Amendment) Rules 2022 and also intimate this to the Registrar.

Silver

Under Rule 12 and Rule 20, the word silver shall be added next to the word gold where ever it is stated, so from now Nidhi Company will able to grant loans to its members for silver jewellery.

Joint Shareholders Loan

In the case of joint shareholders loan Nidhi Company will be able to it only to the member whose name appears first in the register of members.

Dividends

A Nidhi company shall not declare dividends exceeding 25% in a financial year, and this has been added to Nidhi Company New Rules under Rule 18 by substituting old Rule 18.

Compliances By Certain Companies

The Nidhi Company New Rules have added two provisos under the first proviso of Rule 23A. These provisos deal with compliance with the requirements of Rule 3A. These provisos state that if a company does not comply with the requirements or fails to comply with any of the requirements on or after the date of enforcement of Nidhi Company New Rules or if the central government has rejected the application, then it shall not raise the deposit from its members or provide any loan to its member under the provisions of these rules from the date of non-compliance or the date of enforcement of the Nidhi Company Amended Rules or the rejection of the application, whichever is later. And, also that the deposit raised by a company after the date of non-compliance or date of enforcement of the Nidhi Company New Rules or the date of rejection of the application, whichever is later, shall be deemed to have been raised in pursuance of Chapter V of the Companies Act and shall be subject to all the requirement of that chapter or any other provisions of the said Act. No fee shall be charged for filing an application under this rule if it is filed within nine months from the enforcement of the new rules; however, earlier, it was six months.

Forms

In the Annexure, an amendment has been made to Nidhi Company New Rules by making changes to the old rule 2014. The changes have been made in the heading of NDH 2 Form, serial no. 4, serial no. 6, in Form NDH 3 and NDH 4. Also, after NDH 4, another Form of NDH 5 is inserted.

Get Started Now

National Industrial Classification Code

Thu, 02 Dec 2021 13:36:00 +0530

National Industrial Classification Code

The National Industrial Classification Code (“NIC Code”) is a statistical standard for developing and maintaining a comparable data base for various economic activities. This code has been developed with an intent to ascertain and analyze as to how each economic activity is contributing towards national wealth.

The Department of Policy and Promotion in their Press Note 4 (2014 series) dated 26 June 2014 decided to switch over to the NIC 2008 from NIC 1987 version. Since then, all Indian Companies are advised to follow NIC 2008.

NIC 2008 is more compatible with the international system of classification. This enables the compliance processes for registration to flow in a smooth manner.

Where is the NIC Code Used?

1) Udyam Registration:

One has to apply for registration on the Udyam portal, to register as micro, small or medium sized businesses under the Micro, Small and Medium Enterprise Development Act, 2006. While applying for registration on the Udyam portal , a NIC code needs to be submitted.

2) Company Registration/ LLP Registration:

For incorporating a company or a LLP, one needs to register the respective company/LLP on the MCA (Ministry of Corporate Affairs) Portal. While registering, the NIC code of the business is required.

Download Code List

Forms to be filed with ROC

Sun, 14 Nov 2021 14:29:09 +0530

Documents / Forms to be filed with the Registrar of Companies under Companies Act, 2013

Sr. No.	Purpose of the Form as per Companies Act, 2013	Form No. as per Companies Act, 2013	Form No. as per Companies Act, 1956	Due Date	Remarks
1.	Application for reservation of name	Form No. INC-1	Form No. 1A	—	—
2.	One Person Company – Application for Incorporation and Nomination	Form No. INC-2	—	At the time of incorporation of company	Within 60 days of making application for reservation of name in INC-1
3.	One Person Company – Nominee consent form	Form No. INC-3	—	At the time of incorporation of company	—
4.	One Person Company – Change in Member/Nominee	Form No. INC-4	—	Within 30 days of receipt of notice of withdrawal of consent	—
5.	One Person Company – Intimation of exceeding threshold (Share Capital Rs.50 lakh/Turnover Rs.2 crore)	Form No. INC-5	—		Within 60 days from the date where, Share Capital exceeds Rs.50 lakh or Average Annual T/O exceeds Rs.2 Crore
6.	Application for Conversion from Private to OPC	Form No.MGT 14Form No. INC-6	—	MGT 14 – within 30 days of passing special resolution	Form INC 6 to be filed along with affidavit by directors confirming consent for conversion being received from creditors and members of the company. List of members and list of creditors Latest audited financial Balance Sheet and P&L Copy of NOC of secured creditors
7.	Application for Incorporation of Company (Other than OPC)	Form No. INC-7	Form No. 1	—	—
8.	Application to Regional Director for conversion of section 8 company into company of any other kind	Form No. INC-18	—	—	Along with certified true copy of special resolution passing and Notice convening the meeting. Copy of application with annexures shall also be filed with Registrar
9.	Intimation to Registrar of revocation/surrender of licence issued under section 8	Form No. INC-20	—	Within 30 days of date of receipt of order	Where the licence granted to the company has been revoked, then company shall apply.
10.	Declaration prior to the commencement of business or exercising borrowing powers	Form No. INC-21	Form No. 19	Within 180 days of incorporation	Declaration to be filed with fees and content of the form shall be verified by CA, CS, CWA in practice
11.	Notice of situation or change of situation of registered office and verification/change of registered office with same locality	Form No. INC-22	Form No. 18	—	Attachment to the said form shall be, Registered document of Title in name of company OR Lease or Rent agreement in the name of company Authorisation from owner/ occupant to use the premises by the company as Registered Office Proof of evidence of any utility services such as telephone, electricity not older than 2 months
12.	Application to Regional Director for approval to shift the Registered Office from one State to another State or from jurisdiction of one Registrar to another Registrar within the same State	Form No. INC-23	Form Nos. 1AD, 24AAA	—	Publish notice once in a daily news paper in English and in principal language at least one month before filing application Serve individual notice to each debentureholder, depositor and creditor
13.	Application for approval of Central Government for change of name	Form No. INC-24	Form No.1B	Within 60 days of making application for change of name	The change of name is not allowed to a company which has defaulted in filing its annual returns or financial statements or any document due for filing with the Registrar or which has defaulted in repayment of matured deposits or debentures or interest on deposits or debentures New certificate of incorporation in Form No. INC.25 shall be issued to the company consequent upon change of name
14.	Conversion of public company into private company or private company into public company	Form No. INC-27	Form Nos. 1B, 62	Within fifteen days of the receipt of the order from the Central Government.	For effecting the conversion of a private company into a public company or vice versa, the application and a copy of order of the competent authority approving the alteration shall be filed with the Registrar together with the printed copy of the altered articles
15.	Notice of Order of the Court or any other competent authority	Form No. INC-28	Form No. 21	Within 30 days from the date of receipt of certified copy of the order	The certified copy of the order of the Central Government, approving the alteration of the memorandum for transfer of registered office of the company from one State to another, shall be filed with the Registrar of the State
16.	Return of allotment	Form No. PAS-3	Form No. 2	—	—
17.	Private placement offer letter Record of Private placement offer	Form No. PAS- 4 Form No. PAS–5	—	—	A company may make an offer or invitation to subscribe to securities through issue of a private placement offer letter in Form PAS-4 A company shall maintain a record of private placement offer is PAS-5
18.	Notice to Registrar of any alteration of share capital	Form No. SH-7	Form No. 5	—	—
19.	Letter of Offer	Form No. SH-8	—	—	—
20.	Return in respect of buy-back of securities	Form No. SH-11	Form No. 4C	Within 30 days from date of completion of buyback	In case of a listed company, return shall be filed with the registrar and SEBI along with prescribed fee. Annexed to the return, a certificate in Form No. SH. 15 signed by 2 directors including managing director certifying compliance
21.	Application for registration of creation, modification of charge (other than those related to debentures)	Form No. CHG-1	Form No. 8	Within 30 days from date of creation of charge or within 300 days on payment of additional fees	—
22.	Particulars for satisfaction of charge thereof	Form No. CHG-4	Form No. 17	Within 30 days from date of such payment or satisfaction	Registrar shall inform the affected parties within 30 days of making the entry in register of charges kept under sub-section (1) of section 81
23.	Notice of appointment or cessation of receiver or manager	Form No. CHG-6	Form No. 15	Within 30 days of date of passing the order or making of the appointment	Give notice of such appointment to the company and Registrar along with copy of the order or instrument
24.	Application for registration of creation or modification of charge for debentures or rectification of particulars filed in respect of creation or modification of charge for debentures	Form No. CHG-9	Form No. 10	Within 30 days from date of creation of charge or within 300 days on payment of additional fees	—
25.	Return for declaration of beneficial interest in any shares	Form No. MGT-6	Form No. 22B	Within 30 days from date of receipt of declaration by the company	—
26.	Annual Return	Form No. MGT-7	—	within sixty days from the date on which the annual general meeting is held or where no annual general meeting is held in any year within sixty days from the date on which the annual general meeting should have been held together with the statement specifying the reasons for not holding the annual general meeting, with such fees or additional fees as may be prescribed	Signed by a director and the company secretary, or where there is no company secretary, by a company secretary in practice. In case of One Person Company and small company, signed by company secretary or where there is no company secretary, by the director of the company
27.	Return of changes in shareholding position of promoters and top 10 share holders (Listed Companies)	Form No. MGT-10	Within 15 days of such change	—	—
28.	Appointment of auditor	Form No. ADT-1	—	Within 15 days of the meeting	Hold office from the conclusion of that meeting till the conclusion of its sixth annual general meeting and thereafter till the conclusion of every sixth meeting
29.	Application to the CG for removal of auditor before expiry of his term	Form No. ADT-2	—	Within 30 days from the date of Board Resolution	Company shall hold the general meeting within 6 days of receipt of approval of the CG
30.	Resignation of an auditor (Intimation to Registrar by the auditor)	Form No. ADT-3	—	Within 30 days of resignation	To be filed by Auditor
31.	Application for allotment of Director Identification Number	Form No. DIR-3	Form DIN 1	—	—
32.	Intimation of changes in particulars of Director to be given to the Central Government	Form No. DIR-6	Form DIN 4	Within 30 days of change in information provided	Such change(s) in Form DIR 6 in the following manner: Download the Form DIR-6 from portal and fill the relevant changes, attach copy of the proof of changed particulars and verification in the Form DIR-7 all of which shall be scanned and submitted electronically. The form shall be digitally signed by practicing CA or CS or a Cost Accountant. The applicant shall submit the Form DIR-6.
33.	Notice of resignation of a director to the Registrar	Form No. DIR-11	Form No. 32	Within a period of 30 days from the date of resignation	Forward to the registrar a copy of resignation along with reasons for the resignation
34.	Particulars of appointment of Directors and the key managerial personnel and the changes amongst them	Form No. DIR-12	Form No. 32, 32AD	Within 30 days of appointment or change of director or key managerial person	Every Company shall keep at its registered office a register of its director & key management personnel containing the following particulars, namely DIN (optional for key management personnel); Present name & surname in full; Any former name or surname in full; Father’s name, mother’s name & spouse’s name (if married) & surname in full; Date of birth; Residential address (present as well as permanent); Nationality (including the nationality of origin, if different); Occupation; Date of board resolution in which the appointment was made; Date of appointment and reappointment in the company;
					Date of cessation of office & reason therefore Office of director or key managerial personnel held or relinquished in any other body corporate; Membership No. of Company Secretary; PAN No. (mandatory for key management personnel if not having DIN) In addition company shall also include in the aforesaid register the detail of securities held by them in the company and its holding and subsidiaries, subsidiaries of the company’s holding company and associate company relating to- The number, description and nominal value of securities The date of acquisition and the price or other consideration paid Date of disposal and price and other consideration received Cumulative balance and no. of securities held after each transaction Mode of acquisition Mode of holding – physical or dematerialised form Whether securities have been pledged or any encumbrance has been created on the securities
35.	Filing of Resolutions and agreements to the Registrar u/s. 117	Form No. MGT-14	Form No. 23	Within 30 days of passing resolution	A copy of every resolution or any agreement required to be filed, together with the explanatory statement under section 102, if any, shall be filed with the Registrar in Form No. MGT. 14 along with the fee.
36.	Form for filing application to Regional Director	Form No. RD-1	Form No. 24A	—	—
37.	Form for filing petitions to Central Government (Regional Director)	Form No. RD-2	Form No. 24AAA	—	—
38.	Return of appointment of a Managing Director, Whole Time Director or Manager, CEO, Company Secretary and CFO	Form No. MR-1	Form No. 25C	Within 60 days of appointment with the registrar	A company shall file a return of appointment of a Managing Director, Whole Time Director or Manager, Chief Executive Officer (CEO), Company Secretary and Chief Financial Officer (CFO), with the Registrar in Form No. MR.1 along with such fee as may be specified for this purpose. (Not applicable to a private company: Section 196(4) & (5) are not applicable to a private company)
39.	Form of application to the Central Government for approval of appointment or reappointment and remuneration or increase in remuneration or waiver for excess or over payment to managing director or whole time director or manager and commission or remuneration to directors	Form No. MR-2	Form No. 25A	Within a period of 90 days from the date of such appointment to Central Government	—
40.	Application by a company for registration under section 366	Form No. URC-1	Form No. 37, 39	—	A company after obtaining availability of name in terms of the Act, shall attach the required documents and information to the registrar along with Form No. URC 1 in the following manner, namely:- i) For registration as a company limited by Shares; ii) For registration as a company limited by guarantee or as an unlimited company.
41.	Information to be filed by foreign company	Form No. FC-1	Form No. 44	Within 30 days of the establishment of its place of business in India	The list of directors and secretary or equivalent of the foreign company shall contain the following particulars:- Personal name and surname in full; Any former name or names and surname or surnames in full; Father’s name or mother’s name and spouse’s name; Date of birth; Residential address; Nationality of origin; Passport Number, date of issue and country of issue; PAN Number; Occupation; Directorship in any other company, (DIN, Name and CIN of the company); Membership Number (for Secretary only); E-mail ID.
42.	Return of alteration in the documents filed for registration by foreign company	Form No. FC-2	Form No. 49, 52	Within 30 days from the date on which the alteration was made or occurred.	Where any alteration is made or occurs in the document delivered to the Registrar for registration by the foreign company, it shall file with the Registrar, a return containing the particulars of the alteration.
43.	List of all principal places of business in India established by foreign company	Form No. FC-3	Form No. 52	Within 6 months of close of financial year	Every foreign company shall file with the Registrar, along with the financial statement, a list of all the places of business established by the foreign company in India as on the date of balance sheet.
44.	Annual Return of a Foreign company	Form No. FC-4	Form No. PTII	Within 60 days from the last day of its financial year	Every foreign company shall prepare and file an annual return containing the particulars as they stood on the close of the financial year.
45.	Form for filing an application with Registrar of Companies (where no e-form is prescribed)	Form No. GNL-1	Form No. 61	—	For the purpose of filing applications for which no e-form is prescribed under the various rules, the application shall be filed through Form No. GNL-1
46.	Form for submission of documents with Registrar of Companies (where no e-form is prescribed)	Form No. GNL-2	Form No. 62	—	For the purpose of filing the documents for which no e-form is prescribed under the various rules, the document shall be filed through Form No. GNL-2
47.	Memorandum of Appeal	Form No. ADJ	—	Within 60 days from the date of receipt of the order of adjudicating officer by the aggrieved party.	Every appeal against the order of the adjudicating officer shall be filed in writing with the Regional Director having jurisdiction in the matter, and shall be accompanied by a certified copy of the order against which the appeal is sought: Where the party is represented by an authorised representative, a copy of such authorization and the written consent thereto shall also be appended to the appeal: An appeal in Form ADJ shall not seek reliefs therein against more than one order unless the reliefs prayed for are consequential.
48.	Application to Registrar for obtaining the status of dormant company	Form No. MSC-1	—	—	A company may make an application for obtaining the status of a Dormant Company after passing a special resolution to this effect in the general meeting of the company or after issuing a notice to all the shareholders of the company for this purpose and obtaining consent of at least 3/4th shareholders (in value)
49.	Return of dormant companies	Form No. MSC-3	—	Within 30 days from the end of each financial year	A dormant company shall file a “Return of Dormant Company” annually, inter-alia, indicating financial position duly audited by a chartered accountant in practice.
50.	Application for seeking status of active company	Form No. MSC-4	—	—	An application for obtaining the status of an active company shall be made and shall be accompanied by a return in Form MSC-3 in respect of the financial year in which the application for obtaining the status of an active company is being filed.
51.	Form for filing application or documents with Central Government	Form No. CG-1	Form No. 65	—	—
52.	Statement of unclaimed and unpaid amounts (dividend)	Form 5 – INV	—	—	Within 90 days of AGM
53.	Intimation of appointment of cost auditor by the Company	CRA – 2			Within 30 days of appointment of cost auditor OR 180 days from commencement of financial year, whichever is earlier

Get Started Now

Corporate Social Responsibility for Companies

Mon, 15 Mar 2021 10:45:26 +0530

Corporate Social Responsibility under Companies Act

Applicability

The provisions of CSR applies to

every company
its holding company
its subsidiary company
foreign company

Having in the preceding financial year

Net Worth > 500 Crore
Turnover > 1000 Crore
Net Profit > 5 Crore

Importance of Corporate Social Responsibility

Corporate Social Responsibility (CSR) is an immense term which is used to explain the efforts of a company in order to improve society in any other way.

CSR improves the public image by publicizing the efforts towards a better society and increase their chance of becoming favorable in the eyes of consumers.
CSR increases media coverage as media visibility throws a positive light on the organization.
CSR enhances the company’s brand value by building a socially strong relationship with customers
CSR helps companies to stand out from the competition when companies are involved in any kind of community.

Role of Board of Directors

The role of the Board of Directors is explained below

After considering the recommendations made by the CSR Committee, approve the CSR policy for the Company.
The Board must ensure only those activities must be undertaken which are mentioned in the policy
The Board of Directors shall make sure that the company spends in every financial year, minimum 2% of the average net profits made during the 3 immediately preceding financial years as per CSR policy.
In case a company has not completed 3 financial years since its incorporation, the average net profits shall be calculated for the financial years since its incorporation.
The Board’s Report shall disclose –
CSR Committee’s composition
- the contents of CSR Policy
- In case CSR spending does not meet 2% as per CSR Policy, the reasons for the unspent amount, and details of the transfer of unspent amount relating to ongoing project to a specified fund (transfer within a period of six months from the expiry of the financial year).

Transfer and Use of Unspent Amount

The specified funds for transfer of unspent amount are:

A contribution made to the prime minister’s national relief fund.
Any other fund which is initiated by the central government concerning socio-economic development, relief and welfare of the scheduled caste, minorities, tribes, women and other backward classes.
A contribution made to a incubator which is funded either by the central government, the state government, public sector undertaking of state or central Government, or any other agency.
Contributions made to public-funded universities, National Laboratories and Autonomous Bodies (established under the auspices of Indian Council of Agricultural Research (ICAR), Council of Scientific and Industrial Research (CSIR), Department of Atomic Energy (DAE), Indian Institute of Technology (IITs), Indian Council of Medical Research (ICMR), Defence Research and Development Organisation (DRDO), Ministry of Electronics and Information Technology), and Department of Science and Technology (DST) engaged in conducting research in technology, science, medicine, and engineering aimed at encouraging Sustainable Development Goals (SDGs).
In case of the unspent amount relating to an ongoing project under the company’s CSR policy, the amount shall be transferred by the firm in less than 30 days from the end of the financial year to a exclusive account to be opened by a firm in any scheduled bank. The account shall be designated ‘Unspent Corporate Social Responsibility Account’, and the funds shall be used towards its obligations under the CSR policy within a period of three financial years from the date of the transfer. In a case where the company fails to utilise the funds at the end of the three financial years, the funds should be transferred to the specified fund mentioned above within a period of thirty days upon completion of the third financial year.

Constitution of the CSR Committee

Every company to which CSR criteria is applicable shall constitute a Corporate Social Responsibility of the Board (i.e. CSR Committee).
Minimum 3 or more directors must form CSR Committee.
Among those 3 directors, at least 1 director must be an independent director.
An unlisted public company or a private company shall have its CSR Committee without any independent director if an independent director is not required.
In case of a foreign company, the CSR Committee shall comprise of at least 2 persons of which one person shall be a person resident in India authorized to accept on behalf of the foreign company – the services of notices and other documents. Also, the other person shall be nominated by the foreign company.

Duties of the CSR Committee

The CSR Committee shall formulate and recommend a CSR policy to the Board. CSR policy shall point out the activities to be undertaken by the company as enumerated in Schedule VII.
CSR Committee shall recommend the amount of expenditure to be incurred on the CSR activities to be undertaken by the company.
CSR Committee shall monitor the CSR policy of the Company from time to time.
The committee shall establish the transparent controlling mechanism for the implementation of the CSR projects or programs or activities undertaken by the company

CSR Reporting

With respect to CSR Reporting, the provisions are as follows :

The Board’s Report referring to any financial year initiating on or after the 1st day of April 2014 shall include an annual report on CSR.
In case of a foreign company, the balance sheet filed shall contain an annexure regarding report on CSR.

CSR Policy

CSR Policy elaborates the activities to be undertaken by the Company as named in Schedule VII to the Act and spend. The activities should not the same which are done by the company in its normal course of business

Contents of CSR Policy should be placed on the company’s website by the Board
The activities mentioned in the policy must be undertaken by the company
The Company can join hands with other companies for undertaking projects or programs or CSR activities and report separately on such programs or projects
The CSR policy shall monitor the projects or programs.

List of Permitted Activities To Be included in accordance with Schedule VII of the Companies Act, 2013

The Board shall ensure that the activities included by a company in its CSR Policy fall within the purview of the activities included is schedule VII. Some activities are specified in Schedule VII as the activities which may be included by companies in their Corporate Social Responsibility Policies. These activities are related to :

Sr.No	CSR Activities
1	abolishing poverty, malnourishment and hunger, improvising health care which includes preventive health care and sanitation and making available safe drinking water
2	improvement in education which includes special education and employment strengthening vocation skills among children, women, elderly and the differently abled and livelihood enhancement projects
3	improving gender equality, setting up homes and hostels for women and orphans
4	introducing the measures for reducing inequalities faced by socially and economically backward groups
5	Safeguarding environmental sustainability, ecological balance, protection of flora and fauna, animal welfare, agroforestry, conservation of natural resources and maintaining a quality of soil, air and water which also includes a contribution for rejuvenation of river Ganga
6	protection of national heritage, art and culture including restoration of buildings and sites of historical importance and works of art; setting up public libraries; promotion and development of traditional arts and handicrafts
7	areas for the advantage of skilled armed forces, war widows and their dependents
8	training to stimulate rural sports, nationally recognized sports, Paralympic sports and Olympic sports
9	contribution to the Prime Minister’s National Relief Fund or any other fund set up by the Central Government for socio-economic development providing relief and welfare of the Scheduled Castes, the Scheduled and backward classes, minorities and women
10	contributions or funds provided to technology incubators which are approved by the Central Government
11	rural development projects
12	disaster management, including relief, rehabilitation and reconstruction activities
13	slum area development where ‘slum area’ shall mean any area declared as such by the Central Government or any State Government or any other competent authority under any law for the time being in force

Explanation: For the purposes of this item “slum area” shall mean any area declared as such by the Central Government or any State Government or any other competent authority under any law for the time being in force.

Fines and Penalties for Non-Compliance

In case a company fails to comply with the provisions relating to CSR spending, transferring and utilising the unspent amount, the company will be punishable with a minimum fine of Rs 50,000 which may increase to Rs 25 lakh. Further, every officer of such company who defaults in the compliance will be liable for a punishment which is imprisonment for a term which may extend to three years or with a minimum fine of Rs 50,000 which may increase to Rs 5 lakh , or with both.

Reason For Introduction of CSR for Companies

We live a dynamic life in a world that is growing more and more complex. Global scale environment, social, cultural and economic issues have now become part of our everyday life. Boosting profits is no longer the sole business performance indicator for the corporate and they have to play the role of responsible corporate citizens as they owe a duty towards the society. The concept of Corporate Social Responsibility (CSR), introduced through Companies Act, 2013 puts a greater responsibility on companies in India to set out clear CSR framework. Many corporate houses like TATA and Birla have been engaged in doing CSR voluntarily. The Act introduces the culture of corporate social responsibility (CSR) in Indian corporate requiring companies to formulate a CSR policy and spend on social upliftment activities CSR is all about corporate giving back to society. The Company Secretaries are expected to be known about the legal and technical requirements with respect to CSR in order to guide the management and Board.

Get Started Now

File DPT-3 for your Company now, to stay Compliant

Thu, 18 Jun 2020 13:23:52 +0530

The last date for DPT-3 is fast-approaching! File easily with Taxaj

DPT 3 is a return of deposits that companies must file to furnish information about deposits and/or outstanding receipt of loan or money other than deposits. Every company needs to file annual form DPT-3 (Return of Deposits) which is due on or before 30th June 2020.

Who has to File The DPT-3 Form?

Except for the Government companies, all other companies which include all private limited companies, OPC, limited companies or Section 8 Company have to mandatorily file this form. The last date for annual return is within ninety days from the end of a financial year, i.e. 31st March 2020.

Details required for DPT-3 Filing:

· List of deposits matured or cheques issued but not yet cleared. It is mandatory if the company has a balance of deposits outstanding at the end of the year.

· The total outstanding amount of money/loan received by the company at the end of the financial year (other than deposits).

· Details of loan or money received by the company for the financial year ended (other than deposits)

· Auditor’s certificate

Consequences of non-filing

If the company does not adhere to the requirements of DPT-3 and keeps accepting deposits then it will face the following consequences:

Under Section 73

A penalty of minimum 1 crore or twice the amount of deposits whichever is lower, which may extend to Rs.10 crore

For every officer who is in default imprisonment up to 7 years and with a fine not less than Rs.25 lakhs which may extend to Rs.2 crores.

Under Rule 21

On the company and every officer in default a fine which may extend up to Rs.5,000, and where the contravention is a continuing one, a fine of Rs.500 for every day since the default.

Don’t wait till the last date! Avoid the huge penalty and finish filing now with Taxaj to stay compliant.

Get Started Now

Authorized Capital vs Paid-up Capital

Wed, 03 Jun 2020 19:13:22 +0530

How do Share Capital and Paid-up Capital differ?

Capital means the money or sum of money which is invested in a company to carry on its activities and business. The capital of a company is share capital. A company’s capital is mainly received from the shareholders i.e. from shares and debentures. As the company is a legal entity it cannot generate money for investing it in the business i.e. capital. So it is collected from the shareholder by the way of issuing shares to them.

What is an Authorized Capital?

The authorized capital of a corporation is the maximum sum of share capital for which shares could be issued by a corporation. The initial authorized capital of the corporation is stated in the Memorandum of Association of the Company under the heading of “Capital Clause”. The authorized capital could be increased by the corporation at any time in the future with shareholders’ approval as well as by paying an additional fee towards the Registrar of Companies. Though, there might be circumstances where some portion of the authorized share capital might remain un-issued. The number of share capital which has been issued towards the investors is recognized as the issued share capital.

It is also a registered capital or nominal capital of the corporate. A corporation doesn’t need to issue all its authorized capital within the public subscription. It may issue according to the needs and demands of the company. The authorized capital mentioned within the MoA is increased or decreased in the future by following the procedure that was laid down under the Companies Act, 2013, such as:

· Article of Association (AoA) of a company should authorize for increase or decrease in authorized capital and if such provision isn’t there within the AoA, it should be amended as per Section 14 of the Companies Act.

· For increased or decrease in the authorized capital, a notice of the same should be issued to the Directors, Members and Auditors of the company for calling a meeting with the Board of Directors and a general meeting with the shareholders to obtain their approval.

· Within 30 days of passing the resolution, the government informs the registrar of the company along with the copy of the resolution, a notice of General Meeting, and amended MOA in Form SH-7.

What is the meaning of Paid-up Share Capital?

Paid-up share capital of a corporation is the sum of money for which shares have been issued towards the shareholder for which payment was made by the shareholders. This sum is basically the actual fund that the corporation receives on the issue of shares. In general, this amount is raised as Initial Public Offering as well as forms part of the corporation’s Finance. Paid-up capital would always be less than authorized capital as a corporation cannot issue shares above its authorized capital.

The Companies Act, 2013 previously mandated that a Private Limited Company must have a minimum paid-up capital of Rs.1 lakh and a public company must have a minimum paid-up capital of 5 lakh. This intended that Rs.1 lakh worth of money must be invested in the corporation by the purchase of the corporation shares by the shareholders in order to start a business. Though, the Companies Amendment Act, 2015 removed such requirement and relaxed the minimum requirement for paid-up capital. Thus, there is now no requirement for any minimum capital towards being invested to start a private limited company.

Registrar of Companies (ROC) needs to be updated with, in case of any alteration in the Authorized Capital and Paid-Up Share Capital. The rectified details will then be recorded in the Master Data of companies on Ministry of Corporate Affairs (MCA) site that can be further viewed by the public.

What is the difference between authorized and Paid-up Share Capital?

Paid-up capital forms a portion of the authorized capital. Let us see some of the major differences between the authorized and Paid-up Share Capital. They include:

S.No	Authorized Share Capital	Paid-up Share Capital
1	It is the maximum value of the shares issued to the shareholders.	The amount paid by the shareholders to the company for the company’s financing.
2	The Capital Clause of MoA mentions it.	The Capital Clause of MoA mentions it.
3	To increase it, MoA must make the amendment by following the procedure mentioned above	Private placement or issuing of shares does it.
4	All new companies must authorize a minimum amount of capital, which is Rs.1 lakh for Pvt. Ltd Companies and Rs.5 lakh for Public Limited Companies.	Paid-up capital cannot be quite much as the authorized capital; it can either be often lower or equal to it
5	This is no way means an individual owes such an amount to anyone	A company can issue shares and also buy them back, subject to certain terms and conditions.
6	This capital isn’t responsible for the use to calculate the net worth of the company or the business	The paid-up capital amount is used for business expenses. Unlike authorized capital, paid-up capital is used in the company’s net worth calculation. Though both authorized and paid-up capital is mentioned within the balance sheet, just one is used for calculating the firm’s net worth.

The New MCA SPICe+ Form for Company

Wed, 03 Jun 2020 13:10:12 +0530

Procedure for Incorporation of a Company post the launch of SPICe+

Keeping in view the ease of doing business, new form SPICe+ is notified for the incorporation of a company and incidental registrations. The form SPICe+ replaces the existing SPICe form. All the new company incorporation have to be done by the online filing of SPICe+ form. The other forms that need to be filed along with SPICe+ are AGILE-PRO, SPICe+AoA and SPICe+MoA.

What is SPICe+?

SPICe+ stands for Simplified Performa for Incorporating Company electronically Plus. SPICe+ aims to offer about 10 services by three Central Government Ministries and Departments (Ministry of Corporate Affairs, Ministry of Labour and the Department of Revenue in the Ministry of Finance) and one State Government (Maharashtra). The form is an integrated web form with a single-window for multiple services.

Services Offered By SPICe+

The new integrated web form offers the following services:

– Part A –: Name Reservation (New Companies only

– Part B:

· Company Incorporation

· Application for DIN

· PAN Application

· TAN Application

· GSTIN Application

· EPFO Registration

· ESIC Registration

· Opening of Bank Account for the Company

· Professional Tax Registration (only for Maharashtra)

The SPICe+ application form can be applied in two ways:

1. Part A (Name Reservation) and Part B (All Other Services) can be applied for

on a simultaneous basis.

2. Part A can be applied for initially, and upon reservation of the name, Part B can be applied for.

What is AGILE-PRO?

AGILE stands for Application for Goods and services identification number, employees’ state Insurance corporation registration plus Employees’ provident fund organisation registration. The old AGILE form (INC – 35) is now replaced with the AGILE – PRO web form.

Attachments Required

For SPICe+:

· Memorandum of Association

· Articles of Association

· Declaration by the first director(s) and subscriber(s) (Affidavit not required)

· Proof of office address

· Copy of utility bills

· Copy of certificate of incorporation of foreign body corporate (if any)

· A resolution passed by Promoter Company

· The interest of first director(s) in other entities

· Consent of Nominee (INC–3)

· Proof of identity as well as the residential address of subscribers

· Proof of identity as well as residential address of the nominee

· Proof of identity and address of Applicant I, II, III

· Resolution of unregistered companies in case of Chapter XXI (Part 1) Companies

· Declaration in Form No. INC – 14

· Declaration in Form No. INC – 15

· Optional attachments (if any)

· Attachments – Part A

For AGILE-PRO:

· Proof of principal place of business

· Proof of appointment of Authorized Signatory for GSTIN

(Either of the documents– Letter of Authorization/Copy of Resolution passed by BOD/

Managing Committee and Acceptance Letter)

· Proof of identity of Authorized Signatory for the opening of a bank account

· Proof of address of Authorized Signatory for the opening of a bank account

· Specimen Signature of Authorized Signatory for EPFO

Stepwise Procedure for New Company Incorporation under SPICe+
1. The feature ‘SPICe+’ is listed under ‘MCA Services’.
2. Under Company Services click on SPICE+.
3. Click on ‘New Application’ and the next page shows below:

4. If you’ve an existing application, you can choose ‘Existing Application’, feed in the application number along with the proposed or approved name. ‘Type of Company’ displays the below options to choose from:

5. ‘Class of Company’ has the below options:

6. Choose suitable option from ‘Category of Company’
7. ‘Sub-Category of Company’ has the below options:

8. Next, you have to mention the ‘Main division of industrial activity of the Company’
(Mention the code of the industrial activities). For example, if you choose ‘01’, the relevant description of business will be auto-populated in the ‘Description of main division’.
9. Next, you have to give particulars of the ‘proposed or approved name’. You should click the ‘Auto-check’ to do the first level automatic scrutiny of the proposed or approved name in accordance with the rules governing the name. You can submit the ‘Part A’ for reservation of name or proceed with the incorporation.
Upon choosing to proceed with incorporation, ‘Part B’ is enabled. Part B has various sections with validation for ‘check form’ for each section.
10. The details required for registration (as mentioned in the paragraphs above) have to be entered. The details also include:
– Address of the registered office of the company
– Proposed directors and subscribers
– Capital of the company
– Other information to apply for tax registrations such as PAN and TAN
You have to upload the documents required for registration (as mentioned in the paragraphs above).
After filling up Part B, you have to carry out a ‘pre-scrutiny’ check. Once the ‘pre-scrutiny; is successful, click on ‘submit’. A confirmation is displayed upon successful submission of the form.
11. Next, you should download the PDF of Part B submitted for affixing the DSC and for filling up any linked forms along with Part B. The forms linked to SPICe+ are AGILE-PRO, SPICe+MoA and SPICe+AoA, URC-1 and INC-9. Part B of SPICe+ and linked forms can then be uploaded on the MCA portal. A Service Request Number is generated for making a payment towards company incorporation. Once the payment is made successfully, the forms would be processed.
In a case where the forms need re-submission for any errors being flagged upon processing, the SPICe+ form has to be resubmitted in the same manner.

Get your Company Registered in few days via fast & easy process by our Team of Experts!

Get Started Now

COMPANIES FRESH START SCHEME, 2020

Wed, 08 Apr 2020 19:21:29 +0530

Fresh Start Opportunity to Companies

In order to support and enable Companies and Limited Liability Partnership (LLPs) in India to focus on taking necessary measures to address the COVID-19 threat, including the economic disruptions caused by it, the Ministry of Corporate Affairs has come out with a BIG RELIEF for all defaulting Companies/LLPs and DIN holders.

RELIEF 1: INTRODUCTION OF COMPANIES FRESH START SCHEME, 2020 (CFSS-2020)

It has introduced COMPANIES FRESH START SCHEME 2020 (“the Scheme”) vide circular 12/2020 dated 30/03/2020 which applies to all companies in India. It shall come into force on 1.4.2020 and remains effective till 30th Sep 2020.

OPPORTUNITY FOR DEFAULTING COMPANIES:

Under Companies Act, 2013, the companies are required to file, submit various forms, returns, documents, financial statements etc. on time to time basis therefore the Ministry has provided a one-time opportunity to all companies to file their pending Annual Returns (e-form MGT-7), financial statements (e-form AOC-4) and other documents WITHOUT any additional fees. Only normal fees for filing of the documents in the MCA21 registry will be payable during the effective period of the Scheme.

IMMUNITY FROM PROSECUTION:

Further, the Scheme provides immunity to defaulting companies or its officers in default in relation to prosecution or proceeding for imposing an additional penalty for not filing of belated documents. This Scheme doesn’t provide immunity on any other consequential proceedings including proceeding involving the interest of any shareholder of the company or its directors or key managerial personnel etc.

OPPORTUNITY FOR INACTIVE COMPANIES:

The Scheme gives an opportunity to the inactive company to convert into a dormant company under section 455 of Companies Act, 2013 by filing form MSC-1 with nominal fees & help the inactive companies to remain on ROCs register with minimum compliance requirement.

NON-APPLICABILITY OF THE SCHEME:

a) Companies against which action for final notice for striking off the name under section 248 of the Companies Act, 2013 or under section 560 of Companies Act 1956 has already been initiated.

b) Where Company has already filed STK-2 for strike off of Company with ROC.

c) Companies which have amalgamated

d) Whether application has already been filed for obtaining Dormant Status.

e) To Vanishing Companies

f) Charge related documents (CHG-1, CHG-4, CHG-8 and CHG-9)

g) Increased in authorized capital (Form SH-7).

APPLICATION FOR IMMUNITY CERTIFICATE (E-FORM CFSS-2020)

All the companies, who has filed any belated document or form under this scheme, need to make an application in e-form “CFSS-2020” (annexed hereinafter) without any fees with designated authority (ROC/RD) through MCA portal to availed immunity under this scheme after closure of this scheme and after document(s) are taken on record by the designated authority but not later than 6 month from the expiry of this scheme.

NO APPLICATION FOR IMMUNITY:

No immunity shall be granted:

a) for any appeal pending in the court in case of company’s management disputes;

b) for any case of conviction ordered passed by a court or adjudicating authority and no appeal has been preferred against such order before the scheme came in enforce.

IMMUNITY CERTIFICATE:

Based on the e-form CFSS-2020 filed by the Companies, an immunity certificate in respect of documents filed under this scheme shall be issued by designated authority

OTHER BENEFITS UNDER THE SCHEME:

1. Special measures for cases where the order of the adjudicating authority was passed but the appeal could not be filled: In the cases, wherein the penalties are imposed under the Act and the company has not further appealed to higher authorities and such period of appeal lies between 1st March 2020 to 31st May 2020, a period of additional 120 days shall be allowed for filing of appeal from last date as may be specified under the order.

2. The companies, who has filed appeal against any notice issued or complaint filed or an order passed by a court or by any adjudicating authority, can also submit application for issue of immunity certificate if they withdraw their appeal and furnish the proof of such withdrawal with the application.

RELIEF NO 2: FOR DEFAULTING LLPs

MCA earlier has issued “LLP Settlement Scheme (the Scheme)” dated 4^th March, 2020 where it had provided an opportunity to all defaulting LLPs to file their pending documents or forms with ROC by paying a late fee of Rs. 10 per day subject to maximum of Rs. 5,000/- per form (earlier it was Rs. 100 per day without any maximum limit).

Now, the MCA has further amended this Scheme and completely waived off the additional fees. So, the defaulting LLPs now file their pending documents or forms with ROC WITHOUT any additional fees.

Further, the defaulting LLPs, which have filed their belated documents till 30^th September, 2020 and made good the default, shall not be subjected to any prosecution for such defaults.

The revised effective date of the Scheme shall be from 1^st April, 2020 till 30^th September, 2020

RELIEF NO 3: For DIN Holder and Registered office KYC Compliances

DIN holders of DINs marked as ‘Deactivated’ due to non-filing of DIR-3KYC/DIR-3 KYC-Web and those Companies whose compliance status has been marked as “ACTIVE non-compliant” due to non-filing of Active Company Tagging Identities and Verification(ACTIVE) e-form are encouraged to become compliant once again in pursuance of the General Circular No. 11 dated 24th March, 2020 & General Circular No.12 dated 30th March 2020 and file DIR-3KYC/DIR-3KYC-Web/ACTIVE as the case may be between 1st April, 2020 to 30th September, 2020 without any filing fee of INR 5000/INR 10000 respectively.

Get Started Now