blog-banner

Mandatory Compliances for a Private Limited Company

             


Chitra Singh

The basic requirement for incorporation of a Private Limited Company, as per Section 3 of the Companies Act, 2013 (Act) is that 2 or more persons are required to form the company and comply other requirements for incorporation as required by the Act.

However, post incorporation, a Private Limited Company needs to fulfill mandatory compliances stated by the Act.

 

Mandatory compliances to be fulfilled by a Private Limited Company are:

 

      Board Meetings: According to Section 173 of the Act, every company has to hold its first meeting of Board of Directors within 30 days of its incorporation. Thereafter, four Board meetings have to be held every year without a gap of more than 120 days in between the Board meetings. Also, a seven days' notice for the same has to be sent to every Director.

     Disclosure of Director's Interest: As per Section 184 of the Act, every director has to disclose his interest in any company, body corporate, firms, etc., in the first meeting of the Board of every financial year. The disclosure has to be made in Form MBP-1.

      Annual General Meeting: As per Section 96 of the Act, the company must hold its first Annual General Meeting within 9 months from the date of closing of the first financial year. Further, it must hold the meeting every year without the gap of 15 months in between two of such meetings.

      Appointment of auditors: Under Section 139 of the Act, the Board of Directors of a Private Limited Company has to appoint the first auditor within 30 days of the incorporation of the company. The tenure of the auditor shall be till the first Annual General Meeting, after which another auditor would be appointed in the Meeting.

      Annual ROC filings: Under Section 92 of the Act, it is mandatory for a Private Limited Company to file annual return in the eForm MGT-7 within 6 months from the date of the Annual General Meeting. Further, Section 137 states that a copy of the Financial Statement adopted at the Annual General Meeting have to filed with the Registrar within 30 days of the date of the Meeting.

      Corporate Social Responsibility (CSR): A company having net worth of Rs. 500 Crore or more, or turnover of Rs. 1000 Crore or more, or net profit of Rs. 500 Crores or more in a financial year, has to make a CSR committee consisting of 3 Directors, out of which at least one should be an Independent Director. The Committee has to ensure that at least 2% of the net profit made during preceding three financial years is spent in furtherance of the CSR Policy.


About the Author:

I am a law student ( Batch 2019)


Post Your Comment

Post Your Comment

Other Publications By the Author

Mandatory Compliances for a Private Limited Company

Procedure for Registration of Company under Companies Act, 2013


The contents of this Blog are the author's personal views. The Author has the sole liability and responsibility for the same. The website "www.worldlawcentre.com" or its owners shall have no responsibility or liability, of any kind whatsoever, for the same.