Overview of The Companies Act
The Companies Act 2013
The Companies Act, 2013, must be followed with by any business that has its company offices in India.
- The Companies Act, 2013 regulates appointment, qualification, remuneration, and retirement of directors of the Company.
- Aspects such as how to conduct Board Meetings and Shareholders Meetings.
- The preparation and presentation of annual accounts and the regular maintenance of books of accounts.
Here are some important compliance’s post incorporation:-
- Once the incorporation certificate is obtained, a separate legal entityfor the company is established.
- As soon as the company gets its incorporation certificate, within 30 (THIRTY DAYS) days one of the directors must issue the notice for the first board meeting of the company, at least seven days prior to the latter being scheduled for.
- In the first board meeting, the Company is required to appoint its first auditor within 30 days of incorporation by its board of directors and every Director of the company shall disclose his or her concern or interest of the other Companies in the Form MBP-1. Further, in case of any change in the interest of Director he should disclose the change in the next forthcoming Board meeting also he shall disclose in the annual disclosure to be made in the first board meeting of the financial year.
- The Company shall, on and from the 15 (fifteenth) day of its incorporation and at all times thereafter, have a Registered office which is capable of receiving and acknowledging all official communications and notices as may be addressed to it. Verification of the registered office is to be filed in Form INC-22 within 30 days of incorporation.
- It is necessary for the company to have its name board outside its registered office, along with its name, Company’s Identification Number, registered office address, phone number and e-mail id, fax number and website address, if any, stated in it.All the above-mentioned details in point 3 are also required to be printed on the company’s billheads, business letters and on all documents (official) and publications going through the company.
- It is very important for the company to have a PAN (Permanent Account Number) and TAN (Tax Deduction and Collection Account Number) right after its incorporation. Even to open a Bank Account in India these are the basic credentials are required.
- Issuance of share certificates to the shareholders is also an important requirement, and all details of such issuance of share certificate are required to be maintained and mentioned in the register of allotment.
- Maintaining and filing of profit and loss account, balance sheet, and annual return every financial year together with an auditor’s report before the due date with the Registrar of Companies is a very vital requirement of the company act which a company has to endeavor.
- Every company is required to maintain certain Statutory Registers under Section 85, Section 88 etc of the Companies Act, 2013 and required to keep and maintain at its registered office in the prescribed form. In case of any failure in maintaining the statutory register, the company, as well as directors, may be fined and prosecuted.
- The company is also required to conduct minimum 4 board meetings during the calendar year at stipulated intervals and also ensure that all the minutes of the board meeting are safely retained until the company exists. The minutes of the meeting required to be prepared within fifteen days of the meeting and can be finalized within thirty days of the meeting.
- Other than the above-mentioned non-negotiable conditions, there are few more instances where a company is required to intimate the registrar of companies. It includes appointments of directors, removal of Director and certain other changes in the prescribed manner.
- The Companies Act has also inserted the CSR (Corporate Social Responsibility) provisions in the Companies Act, 2013. Now, under provisions contained under the Corporate Social Responsibility, companies are obligated to make the contribution in certain philanthropic activities. Companies must adhere to the CSR criteria and undertake CSR activities in the financial year.
- The aforesaid compliance requirements only apply to the Companies Act, 2013. In addition to this, further registration is required, depending on business type and turnover, such as Professional Tax, GSTN etc.It is important to note that the responsibility of a company to comply with all rules and regulations provided in the Companies Act is not a one-time thing, but is a continuous affair.