ROC Annual Compliance
Compliances for Private Limited Company
Compliance refers to the ability to follow commands, rules, or demands.
A private limited company registered in India must guarantee that all compliance requirements under the Companies Act, 2013 are met.
The Companies Act of 2013 governs the appointment, qualification, salary, and retirement of company directors, as well as the conduct of board and shareholder meetings.
RoC compliance is required for all registered private limited companies. Regardless of total turnover or capital amount, the company must meet the annual compliance requirement.
All firms registered in India, including private limited companies, one-person companies, limited corporations, and section 8 companies, are required to file yearly compliances such as annual returns and income tax filings each year. Though Company Registration is the most popular method of beginning a business, various compliances must be met once the business is incorporated.
Managing the day-to-day operations of a firm while adhering to stringent corporate laws can be difficult for entrepreneurs. So, it is always preferable to get professional assistance and understand the legal requirements to ensure timely compliance and avoid penalties or fines.
What are compliances to be maintained by the Private Limited Company?
The compliance requirement for Private Limited Company has changed drastically over the years. Following is the summary of the private limited company compliance due dates in 2021.
| Compliance | Description |
|---|---|
| Commencement of business ( within 180 days) | For companies registered in India after November 2019, having a share capital, it is necessary to obtain a commencement if business certificate before commencing any business or exercising the borrowing powers. The commencement of business certificate must be obtained within 180 days of incorporating a Company. In case the individual fails to obtain this certificate, there is a penalty of Rs. 50,000 for the company Rs. 1000 per day for the directors for each day of default. |
| Auditor Appointment (Within 30 days) | All registered Indian Companies must appoint a Statutory auditor within 30 days of incorporation. If the company fails to appoint an auditor, the company won’t be allowed to commence business. Also, there is a penalty of Rs. 300 per month. |
| Income Tax Return | Income tax returns need to be filed on or before 30th September 2021 for the Financial year 2020-21. |
| MCA Form AOC-4 | The registered private limited companies must file MCA Form AOC-4 on or before 30th November 2021 for the FY2020-21. Failure to file AOC-4 will attract a penalty of Rs. 200 per day of default or delay. |
| MCA Form MGT-7 | It is necessary to file MCA form MGT-7 on or before 31st December 2021 for FY2020-21. Failure to file MGT-7 attracts a penalty of Rs.200 Per day of default or delay. |
| DIN eKYC | All the directors of the company must be filed for the DIN eKYC or DIR-3 eKYC. In DIR-3 eKYC, the Director must provide a unique personal mobile number and a personal email address. There’s a penalty of Rs. 5000 in case of failure to file DIN eKYC. |
| Hold Annual General Meeting | For a private limited company, it is mandatory to hold an annual general meeting once a year. Companies are required to keep their AGM within six months from closing the Financial year. |
| Director’s report | Preparation of the Directors report will be done with all the information required under Section 134. |
Statutory Audit Compliances
Statutory audit compliances are conducted to evaluate whether an organisation offers correct financial information by reviewing bank balances, bookkeeping records, and financial transactions.
Annual ROC Filings
Private limited firms must file annual accounts and returns with the registrar, providing information about its shareholders, directors, and so on.
As part of the annual filing, the following forms must be filed with the ROC:
Form MGT-7 (Annual Returns) must be submitted within 60 days of the annual general meeting.
A private limited company must file Form AOC-4 (Financial statements) within 30 days, together with a balance sheet, profit and loss statement, and director report.
Annual General Meeting
A shareholder meeting must be held at least once a year, within six months of the end of the fiscal year.
AGMs are convened to approve financial statements, declare dividends, appoint or re-appoint auditors, set commissions, and pay directors, among other things.
The meeting is held within regular business hours on a non-public holiday. It must occur at the registration of the firm or the city, village, or town in which the registered office is located.
Board Meeting
A company’s first Board of Directors meeting must be held within 30 days after its incorporation.
Four board meetings should be held every three months, with at least two directors or one-third of the total number of directors, whichever is greater, present.
Furthermore, the meeting’s discussion must be drafted, recorded in the meeting minutes, and kept at the company’s registered office.
Seven days before to the meeting, a notice of the date and purpose should be sent out.
Non-compliance
In case if a company fails to comply with the rules and the regulations of the Companies Act, then the company and its members who default shall be punishable with a dine for the period of which the default is continuing.
In case there is a delay in annual filing, additional fees are required to be paid. Hence, it is always better to fulfill the compliances on time.