ANNUAL RETURN UNDER COMPANIES ACT 2013

PROVISIONS REGARDING ANNUAL RETURN UNDER COMPANIES ACT 2013

Introduction :

Annual Return of Company acts as a catalogue of in-depth information on various facets of the company. The two sets of information and particulars of company are either based on financial matters or Non-financial matters. The financial position and performance of the company are included in Financial statements which is filed with Registrar of Companies (ROC) in Form AOC-4.

The non-financial aspects of Company are filed by way of Annual Return in Form MGT-7.

As per section 92 of the the Companies Act, 2013, every company is required to file Annual Return with the Registrar within 60 days from the date on which

1. Annual General Meeting is actually held or,

2. from the last day on which AGM should have been held.

The date of Annual General Meeting is Excluded.

For Foreign Companies:

Rule 7 of the Companies (Registration of Foreign Companies) Rules, 2014 provides that:

Every foreign company shall prepare and file Annual return in form FC.4 within a period of 60 days from the last day of its financial year.

The Financial years of other countries are different and not necessarily according to Indian Financial Year. Prior to amendments carried out in Companies Act ,Most of the foreign Companies used to apply to Tribunal for allowing them to file annual return according to their financial year. Presently the Companies Act has given the flexibility to Foreign Companies to file Annual return according to their financial years. and henceforth it has to be filed within 60 days from the last day of thier Financial year.

PENALTY :

If a company fails to file its annual return under section 92, before the expiry of the period specified therein, the company shall be punishable with fine which shall not be less than fifty thousand rupees but which may extend to five lakh rupees and

Every officer of the company who is in default shall be punishable with imprisonment for a term which may extend to six months or with fine which shall not be less than fifty thousand rupees but which may extend to five lakh rupees, or with both.(Section 92)

Revised Provisos to Section 403(1)- ―Provided that where any document, fact or information required to be submitted, filed, registered or recorded, as the case may be, under section 92 is not submitted, filed, registered or recorded, as the case may be, within the period provided in those section,

it may be submitted, filed, registered or recorded, as the case may be, after expiry of the period so provided in those sections, on payment of such additional fee as may be prescribed, which shall not be less than one hundred rupees per day and different amounts may be prescribed for different classes of companies.

CONTENTS OF ANNUAL RETURN :

An Annual Return contains the information regarding:

(a) its registered office, principal business activities, particulars of its holding, subsidiary and associate companies;

(b) its shares, debentures and other securities and shareholding pattern;

(d) its members and debenture-holders along with changes therein since the close of the previous financial year;

(e) its promoters, directors, key managerial personnel along with changes therein since the close of the previous financial year;

(f) meetings of members or a class thereof, Board and its various committees along with attendance details;

(g) remuneration of directors and key managerial personnel;

(h) penalty or punishment imposed on the company, its directors or officers and details of compounding of offences and appeals made against such penalty or punishment;

(i) matters relating to certification of compliances, disclosures as may be prescribed;

(j) details, as may be prescribed, in respect of shares held by or on behalf of the Foreign Institutional Investors and

(k) such other matters as may be prescribed.

With a view to facilitate ease of doing business and for reducing the burden of One Person Company and Small Company, the Central Government is empowered to prescribe an abridged form of Annual Return.

SIGNING OF ANNUAL RETURN:

Under section 92(1) of the Act, the Annual Return is required to be signed both by a director and the Company Secretary, or where there is no Company Secretary, by a PCS.

PROVIDED THAT , the Annual Return of One Person Company and Small Company shall be signed by the Company Secretary or where there is no company secretary, by the director of the company

CERTIFICATION IN FORM MGT 8.:

The Annual Return of a listed company or

of a company having a paid up share capital of Rs. 10 Crores or

more or turnover of Rs. 50 Crores or more

shall be certified by a PCS in the Form No. MGT

http://thelegalmagister.blogspot.com/2018/06/form-mgt-8-certification-of-annual.html

Section 92 (3) :

"Every company shall place a copy of the annual return on the website of the company, if any, and the web-link of such annual return shall be disclosed in the Board's report."

The requirement to attach an extract of Annual Return with the Board‘s Report is omitted under Companies Act Amendment Act 2017.

PENALTY FOR PCS:

If a company secretary in practice certifies the annual return otherwise than in

conformity with the requirements of this section or the rules made thereunder, he shall be

punishable with fine which shall not be less than fifty thousand rupees but which may

extend to five lakh rupees.

PLACE OF KEEPING ANNUAL RETURN:

(Section 94(1)) The copies of Annual Return are required to be be kept at the Registered Office of the company or with the approval of members by way of a Special Resolution, these can be kept at any place in India, where more than 1/10 th of the total members reside, provided the copy of such resolution is given to the Registrar in advance.

INSPECTION OF ANNUAL RETURN:

Any member, debenture holder, other security holder or beneficial owner can inspect Annual Return without any payment of fees at such reasonable time, which should not be less than two hours during the business hours on any working day. Any other person can inspect Annual Return on payment of such fee as may be specified in the articles of association of the company but not exceeding fifty rupees for each inspection.

PENALTY FOR REFUSING INSPECTION:

If company refuses any inspection or the making of any extract or copy of annual return, the company and every officer of the company who is in default shall be liable, for each such default, to a penalty of Rs. 1,000 for every day subject to maximum of Rs. 1,00,000 during which the refusal or default continues.

PRESERVATION OF ANNUAL RETURN

The Annual return shall be preserved for for period of 8 years from the date of filing with roc