Appendix 42

 

ICSI GUIDANCE NOTE ON COMPLIANCE CERTIFICATE UNDER PROVISO TO SUB‑SECTION (1) OF SECTION 383A OF THE COMPANIES ACT, 1956

 

INTRODUCTION

 

The Companies (Amendment) Act, 2000 has inserted a proviso to sub‑section (1) of section 383A of the Companies Act, 1956, (hereinafter referred to as "the Act") with regard to issue of Compliance Certificate, which reads as follows:

 

“S. 383A(1).     Every company having such paid‑up share capital as may be prescribed shall have a whole‑time secretary, and where the Board of directors of any such company comprises only two directors, neither of them shall be the secretary of the company :

 

Provided that every company not required to employ a whole‑time secretary under sub‑section (1) and having a paid‑up share capital of ten lakh rupees or more shall file with the Registrar a certificate from a secretary in whole‑time practice in such form and within'such time and subject to such conditions as may be prescribed, as to whether the company has complied with all the provisions of this Act and a copy of such certificate shall be attached with Board's report referred to in section 217".

 

As per rule 2 of the Companies (Appointment and Qualifications of Secretary) Rules, 1988 , every company having a paid‑up share capital of rupees fifty lakhs or more is required to have a whole‑time secretary.

 

Accordingly, every company having a paid‑up share capital of rupees ten lakhs or more but less than rupees fifty lakhs is required to file with the Registrar of Companies (ROC) a Compliance Certificate from a secretary in whole‑time practice and also attach a copy of that certificate with Board's report.

 

NEED FOR COMPLIANCE CERTIFICATE

 

The successive Annual Reports on the Working and Administration of the Companies Act, 1956 reveal that a large number of documents are returned for rectification of defects and also remain pending for being taken on record. While this state of affairs has perhaps resulted from the constraints under which the offices of the ROCs operate, it cannot be denied that in case of documents returned for rectification, a large number of errors or omissions arise on account of misinterpretation or ignorance of the provisions of law.

 

Further, the Department of Company Affairs institutes every year a large number of prosecutions against the companies and their officers in default for contravention of various provisions of the Companies Act. Most of the companies against which prosecutions are instituted are private limited companies or small public limited companies which do not have the benefit of expert professional services of qualified Company Secretaries.

 

Thus, it is a well established fact that smaller companies fall prey to violations of the provisions of the Companies Act in the absence of professional support as compared to companies which have employed a qualified Company Secretary.

 

Compliance Certificate is, therefore, salutary as it creates an awareness among companies to comply with the provisions of the Companies Act and also provides a mechanism for self regulation by companies.

 

Compliance Certificate will not only act as an effective mechanism to ensure that the legal and procedural requirements under the Companies Act are duly complied with but also instill professional discipline in the working of the company besides building up the necessary confidence in the state of affairs of the company. It will relieve the company and its directors including the nominee directors from the consequences of unintended non‑compliance of the provisions of the Companies Act. It will further curb the tendency on the part of the smaller companies to short circuit the procedural requirements which primarily occur due to ignorance or lack of professional support. It will act as a pre‑emptive check to monitor compliatice with the requirements of the Companies Act and the Rules made thereunder.

 

The Company Secretaries, while undertaking the work of issuing Compliance Certificate will act as a friend and guide to the management of companies. There is also a need to educate the management of small companies and to instill professionalism in their management so that these companies appreciate their contribution. Only a positive and helpful approach would build the necessary confidence. If there have been technical non‑compliances, the approach should be to guide and advise the company to make good the deficiencies by maintaining proper records, filing the requisite returns or seeking compounding of offences.

 

SECRETARY IN WHOLE‑TIME PRACTICE

 

Section 2(45A) defines "secretary in whole‑time practice" as a secretary who shall be deemed to be in practice within the meaning of sub‑section (2) of section 2 of the Company Secretaries Act, 1980 and who is not in full‑time employment. Thus, a member of the Institute of Company Secretaries of India, who is not in full‑time employment can become a Secretary in whole‑time practice (hereinafter referred to as CSP) after obtaining from the Council of the Institute a Certificate of Practice under section 6 of the Company Secretaries Act, 1980 and the regulations thereunder.

 

THE COMPANIES (COMPLIANCE CERTIFICATE) RULES, 2001

 

In terms of the newly inserted proviso to sub‑section (1) of section 383A, the Central Government has prescribed the Companies (Compliance Certificate) Rules, 2001 (hereinafter called the rules) for issue of Compliance Certificate by a CSP. The text of the Rules is given in Annexure 'A'.

 

COMMENCEMENT OF RULES

 

The Rules have come into force w.e.f. February 1, 2001 i.e. the date of their‑publication in the Official Gazette.

 

OBTAINING OF COMPLIANCE CERTIFICATE

 

According to sub‑rule (1) of rule 3, every company not required to employ a whole‑time secretary under sub‑section (1) of section 383A of the Act and having a paid‑up share capital of ten lakh rupees or more shall obtain a certificate from a CSP.

 

It may be noted that the requirement of obtaining compliance certificate is mandatory for a company to which proviso to sub‑section (1) of section 383A applies even if it has employed a whole‑time secretary.

 

Thus, every company which is not requires to employ a whole‑time secretary and whose paid‑up share capital is ten lakh rupees or more at any point of time during the financial year, shall be required to obtain Compliance Certificate from a CSP in respect of that financial year.

 

SCOPE OF COMPLIANCE CERTIFICATE

 

The scope of Compliance Certificate would comprise of certification of the compliance of various requirements under the Companies Act and the Rules thereunder. The CSP should certify compliance only in respect of matters specified in the Form prescribed under the Rules and where any matter is not applicable, he should specify accordingly.

 

Sub‑rule (2) of rule 3 specifies that the Compliance Certificate shall be in Form appended to the Rules or as near thereto as circumstances admit. Certain amount of flexibility in the Form has, therefore, been provided which means that if any information required to be given in the Certificate does not fit into the format, necessary modifications way be made in the format by the CSP.

 

At the time of issue of the first Compliance Certificate, CSP should verify the registers and records maintained by the company from the first day of the financial year except where there are reasons for CSP to verify the records for the earlier years. Such occasions may arise in respect of maintenance of registers, retirement of directors by rotation, issue of share certificate when the allotments were made in the earlier years, payment of managerial remuneration, etc.

 

PERIOD OF CERTIFICATION

 

Sub‑rule (2) of rule 3 provides that the Compliance Certificate shall relate to the period pertaining to the financial year of the company.

 

The Companies (Amendment) Act, 2000 has come into force w.e.f. 13th December, 2000 and the Companies (Compliance Certificate) Rules, 2001 have come into force w.e.f. from 1st February, 2001. Accordingly every company to which these Rules are applicable is required to obtain a Compliance Certificate from a CSP for the financial year in respect of which Board's report is signed on or after 1 st February, 2001.

 

FILING OF COMPLIANCE CERTIFICATE

 

Every company to which these Rules apply is required to file with the ROC the Compliance Certificate within thirty days from the date on which its annual general meeting is held.

 

Where the annual general meeting of such company for any year has not been held, such certificate is required to be flied with the ROC within thirty days from the latest day on or before which that meeting should have been held in accordance with the provisions of the Companies Act.

 

In case the annual general meeting is held and adjourned, the Compliance Certificate should be filed with the ROC within thirty days from the date on which such adjourned meeting was held provided such adjourned meeting is held within the statutory limit.

 

RIGHT TO ACCESS RECORDS

 

Sub‑rule (3) of rule 3 provides that the CSP for the purpose of issue of Compliance Certificate shall have right to access at all times to the registers, books, papers, documents and records of the company whether kept in pursuance of the Act or any other Act or otherwise and whether kept at the registered office of the company or elsewhere and shall be entitled to require from the officers or agents of the company, such information and explanations as the CSP may think necessary for the purpose of such certificate.

 

ATTACHMENT OF COMPLIANCE CERTIFICATE WITH BOARD'S REPORT

 

Proviso to sub‑section (1) of section 383A of the Act requires that the Compliance Certificate shall be attached with the Board's report referred to in section 217. It is, therefore, necessary for the company to attach a copy of the Compliance Certificate with the Board's report while forwarding the same to members and others under section 219 of the Act.

 

Further it would also be desirable for the Board to give full information and explanation in its report to the members under section 217 of the Act on every reservation, qualification or adverse remarks contained in the Compliance Certificate.

 

LAYING OF THE COMPLIANCE CERTIFICATE AT THE ANNUAL GENERAL MEETING

 

Sub‑rule (4) of rule 3 requires the Compliance Certificate to be laid by the company in its annual general meeting. As a good secretarial practice, the certificate should be read at the meeting and also made available to the members for inspection.

 

PENALTY FOR NON‑COMPLIANCE

 

Where a company fails to comply with the requirement of filing the Compliance Certificate with the ROC or attaching the copy of such certificate with Board's report, in terms of sub‑section (1A) of section 383A the company and every officer of the company who is in default shall be punishable with fine which may extend to Rs. 500 for every day during which the default continues.

 

MODE AND PERIOD OF APPOINTMENT OF CSP

 

As the Compliance Certificate is required to be addressed to the members of the company, it would be in the fitness of things that the appointing authority is the members to whom this certificate is addressed. It is advisable that the CSP is appointed by the members in the annual general meeting of the company. Such appointment shall be from the conclusion of that annual general meeting until the conclusion of the next annual general meeting. It is also recommended that the first appointment of the CSP may be made by the Board of directors to hold office until the conclusion of the annual general meeting held after such appointment.

 

The Board may fill any casual vacancy in the office of CSP to hold office until the conclusion of the next annual general meeting. However, if such a vacancy is caused by the resignation of CSP, it is advisable that the vacancy is filled up by the company in general meeting.

 

DISQUALIFICATIONS OF SECRETARY IN WHOLE‑TIME PRACTICE

 

With a view to ensure that CSP shows utmost integrity and independence of judgement in the performance of his duties, a person referred to in sub section (3) or sub‑section (4) of section 226 of the Act, should not be eligible for appointment or reappointment for giving Compliance Certificate to a company.

 

Accordingly, the following persons shall not be qualified for appointment as CSP of a company

 

(a)        a body corporate;

 

(b)        an officer or employee of the company;

 

(c)        a person who is a partner, or who is in the employment, of an officer or employee of the company;

 

(d)        a person who is indebted to the company for an amount exceeding one thousand rupees, or who has given any guarantee or provided any security in connection with the indebtedness of any third person to the company for an amount exceeding one thousand rupees;

 

(e)        a person holding any security of that company which carries voting rights.

 

However, any securities held by such person as nominee or trustee for any third person and in which the holder has no beneficial interest shall be excluded from such disqualification.

 

Further, if a person is not qualified for appointment as CSP of a company for reasons stated above, then he is also disqualified for appointment as CSP of any other body corporate which is that company's subsidiary or holding company or a subsidiary of that company's holding company, or would be so disqualified if the body corporate were a company.

 

If a CSP becomes subject, after his appointment, to any of the disqualifications specified above, he shall be deemed to have vacated his office.

 

 

COMMUNICATION TO EARLIER INCUMBENT

 

In view of the provisions of clauses (8) and (11) of Part I of the First Schedule to the Company Secretaries Act, 1980, it is recommended that whenever a new incumbent is assigned the compliance certification work, he should communicate his appointment to the earlier incumbent by registered post.

 

METHODOLOGY FOR CARRYING OUT VERIFICATION FOR CERTIFICATION

It would be advisable that the CSP requests the company for access to various documents and books including the Memorandum and Articles of Association of the company, Annual Reports of the last two to three years, various statutory and other registers including the Minutes Books, copies of forms and returns flied with the ROC etc. which he considers essential for the purposes of laying down the certification programme.

 

CSP should verify all the available records. However, depending on the facts and circumstances he may obtain a letter of representation from the company in respect of matters where verification by CSP may not be practicable, for example matters like

 

(i)         dis‑qualification of directors

(ii)        how cause notices received

(iii)       persons and concerns in which directors are interested

 

CERTIFICATION WITH QUALIFICATION

 

As specified in the Form, the qualification, reservation or adverse remarks, if any, may be stated by the CSP at the relevant places.

 

If the scope of work required to be performed, is restricted on account of limitations imposed by the client or on account of circumstantial limitations (like certain books or papers being in custody of another person or Government Authority) the certificate may be qualified as such.

 

CSP shall have due regard to the circulars and/or clarifications issued by the Department of Company Affairs from time to time. It is recommended that a specific reference of such circulars at the relevant places in the certificate may be made, wherever necessary.

 

PENALTY FOR FALSE COMPLIANCE CERTIFICATE

 

Section 628 deals with penalty for false statements. According to this section, if in any return, report, certificate, balance sheet, prospectus, statement or other document, required by or for the purpose of any of the provisions of the Act, any person makes a statement

 

(a)        which is false in any material particular, knowing it to be false, or

(b)        which omits any material fact, knowing it to be material;

 

he shall, except as otherwise expressly provided in the Act, be punishable with imprisonment for a term which may extend to two years and shall also be liable to fine.

 

In view of this, a CSP will be attracting the penal provisions of section 628, for any false statement in any material particular or omission of any material fact in the Compliance Certificate. However, a person will be penalised under section 628 in case he makes a statement, which is false in any material particular, knowing it to be false, or which omits any material fact knowing it to be material.

 

PROFFSSIONAL RESPONSIBILITY

 

While the newly inserted provision has opened up the much awaited significant area of practice for company secretaries, it equally casts onerous responsibility on them and poses a greater challenge whereby they have to justify fully the faith and confidence reposed by the Government and trade and industry and measure up to their expectations. Company Secretaries must take adequate care while issuing Compliance Certificate. It is based on this certificate that confidence of the company, Government and trade and industry will build‑up vis‑a‑vis our profession. Any failure or lapse on the part of a CSP in issuing a Compliance Certificate may not only attract penalty for false statement under section 628 and disciplinary action for professional or other misconduct under the provisions of the Company Secretaries Act, 1980 but also make him liable for any injury caused to any person due to his negligence in issuing the Compliance Certificate. Therefore, it becomes imperative for the CSP that he exercises great care and caution while issuing the Compliance Certificate and also adheres to the highest standards of professional ethics and excellence in providing his services.

 

FEES FOR COMPLIANCE CERTIFICATION

 

The scale of fees for compliance certification may be based on criteria, like paid‑up share capital, number of shareholders and debenture holders, nature and standard of secretarial practices prevalent in the company, man‑hours involved etc. However, the minimum fee for certification shall ordinarily not be less than Rs. 5,000 for a finaricial year.

 

CHECKLIST FOR ISSUE OF COMPLIANCE CERTIFICATE

 

Checklist for issue of Compliance Certificate is attached at as Annexure 'B'.

 

 

ANNEXURE ‘A’

 

[Issued by Ministry of Law, justice and Company Affairs, Department of Company Affairs vide File No. 1/14/2000‑CL, V. dated 31.1.2001; Published in the Gazette of India, Extraordinary, Part‑II, Section 3, Sub‑section (i), dated 1.2.2001]

 

Notification

 

G.S.R. 52(E).‑ In exercise of the powers conferred by sub‑section (1) of section 642 read with proviso to sub‑section (1) of section 383A of the Companies Act, 1956 (1 of 1956), the Central Government hereby makes the following rules, namely:

 

R. 1. Short Title and Commencement.‑

(1)        These rules may be called the Companies (Compliance Certificate) Rules, 2001.

(2)        They shall come into force on the date of their publication in the Official Gazette.

 

R. 2. Definitions.‑ In these rules, unless the context otherwise requires,

 

(a)        "Act" means the Companies Act, 1956 (1 of 1956);

 

(b)        "Certificate" means a certificate referred to in the proviso to sub‑section (1) of section 383A of the Act;

 

(c)        "Form" means Form appended to these rules; and

 

(d)        The words and expressions used in these rules but not defined in these rules shall have the same meanings respectively assigned to them in the Act.

 

R. 3. Other Conditions.‑

(1)        Every company not required to employ a whole‑time secretary under sub‑section (1) of section 383A of the Act and having a paid‑up share capital of ten lakh rupees or more shall obtain a certificate from a secretary in whole‑time practice.

 

(2)        The company referred to in sub‑rule (1) shall file with the Registrar a certificate in Form or as near thereto as circumstances admit in respect of each financial year within thirty days from the date on which its annual general meeting was held :

 

Provided that where the annual general meeting of such company for any year has not been held, there shall be flied with the Registrar such certificate within thirty days from the latest day on or before which that meeting should have been held in accordance with the provisions of the Act.

 

(3)        Every secretary in whole‑time practice for the purpose of issue of certificate referred to in sub‑rule (2) shall have right to access at all times to the registers, books, papers, documents and records of the company whether kept in pursuance of the Act or any other Act or otherwise and whether kept at the registered office of the company or elsewhere and shall be entitled to require from, the officers or agents of the company, such information and explanations as the secretary in whole time practice may think necessary for the purpose of such certificate.

 

(4)        Every certificate referred to in sub‑rule (2) shall be laid by the company in its annual general meeting.

 

FORM

 

[See Rule 3]

 

Compliance Certificate

 

To,

The Members

 

______________________    (Name of the company)

 

I /We have examined the registers, records, books and papers of ________ Limited (the Com­pany) as required to be maintained under the Companies Act, 1956, (the Act) and the rules made thereun­der and also the provisions contained in the Memorandum and Articles of Association of the Company for the financial year ended on 31st March, 20.... In my/our opinion and to the best of my/our informa­tion and according to the examinations carried out by me/us and explanations furnished to me/us by the company, its officers and agents, I/we certify that in respect of the aforesaid financial year:

 

1.         the company has kept and maintained all registers as stated in Annexure 'A' to this certificate, as per the provisions and the rules made thereunder and all entries therein have been duly recorded.

 

2.         the company has duly filed the forms and returns as stated in Annexure 'B' to this certificate, with the Registrar of Companies, Regional Director, Central Government, Company Law Board or other authorities within the time prescribed under the Act and the rules made thereunder.

 

3.         the company being private limited company has the minimum prescribed paid‑up capital and its maximum number of members during the said financial year was  excluding its present and past employees and the company during the year under scrutiny:

(i)         has not invited public to subscribe for its shares or debentures; and

 

(ii)        has not invited or accepted any deposits from persons other than its members, directors or their relatives.

 

4.         the Board of Directors duly met ________ times on ________ (dates) in respect of which meetings proper notices were given and the proceedings were properly recorded and signed including the circular resolutions passed in the Minutes Book maintained for the purpose.

 

5.         the company closed its Register of Members, and/or Debenture‑holders from to  and necessary compliance of section 154 of the Act has been made.

 

6.         the annual general meeting for the financial year ended on _________ was held on _________ after giving due notice to the members of the company and the resolutions passed thereat were duly recorded in Minutes Book maintained for the purpose.

 

7.         extra ordinary meetings(s) was/were held during the financial year after giving due notice to the members of the company and the resolutions passed thereat were duly recorded in the Minutes Book maintained for the purpose.

 

8.         the company has advanced loan amounting to Rs _________ to its directors and/or persons or firms or companies referred in the section 295 of the Act after complying with the provisions of the Act.

 

9.         the company has duly compiled with the provisions of section 297 of the Act in respect of contracts specified in that section.

 

10.        the company has made necessary entries in the register maintained under section 301 of the Act.

 

11.        the company has obtained necessary approvals from the Board of Directors, members and previous approval of the Central Government pursuant to section 314 of the Act wherever applicable.

 

12.       the Board of Directors or duly constituted Committee of Directors has approved the issue of duplicate share certificates.

 

13.        the Company has:

 

(i)         delivered all the certificates on allotment of securities and on lodgment thereof for transfer/transmission or any other purpose in accordance with the provisions of the Act;

 

(ii)        deposited the, amount of dividend declared including interim dividend in a separate bank account on _________ which is within five days from the date of declaration of such dividend;

 

(iii)       paid/posted warrants for dividends to all the members within a period of 30 (Thirty) days from the date of declaration and that all unclaimed/unpaid dividend has been transferred to Unpaid Dividend Account of the Company with ___________ Bank on _____________ ;

 

(iv)       transferred the amounts in unpaid dividend account, application money due for refund, matured deposits, matured debentures and the interest accrued thereon which have remained unclaimed or unpaid for a period of seven years to Investor Education and Protection Fund;

 

(v)        duly complied with the requirements of section 217 of the Act.

 

14.       the Board of Directors of the company is duly constituted and the appointment of directors, additional directors, alternate directors and directors to fill casual vacancies have been duly made.

 

15.       the appointment of Managing Director/ Whole‑time Director/ Manager has been made in compliance with the provisions of section 269 read with Schedule XIII to the Act and approval of the Central Government has been obtained in respect of appointment of ______________ not being in terms of Schedule XIII.

 

16.        the appointment of sole‑selling agents was made in compliance of the provisions of the Act.

 

17.       the company has obtained all necessary approvals of the Central Government, Company Law Board, Regional Director, Registrar or such other authorities as may be prescribed under the various provisions of the Act as detailed below:

 

18.       the directors have disclosed their interest in other firms/companies to the Board of Directors pursuant to the provisions of the Act and the rules made thereunder.

 

19.        the company has issued ___________ shares/debentures/other securities during the financial year and complied with the provisions of the Act.

 

20.        the company has bought back _____________ shares during the financial year ending ________ after complying with the provisions of the Act,

 

21.       the company has redeemed ______________   preference shares/debentures during the year after complying with the provisions of the Act.

 

22.       the company wherever necessary has kept in abeyance rights to dividend, rights shares and bonus shares pending registration of transfer of shares in compliance with the provisions of the Act.

 

23.       the company has complied with the provisions of sections 58A and 58AA read with Companies (Acceptance of Deposit) Rules, 1975/the applicable directions issued by the Reserve Bank of India/any other authority in respect of deposits accepted including unsecured loans taken, amounting to Rs ________________ raised by the company during the year and the company has filed the copy of Advertisement/ Statement in lieu of Advertisement/necessary particulars as required with the Registrar of Companies ___________ on__________. The company has also flied return of deposit with the Registrar of Companies/Reserve Bank of India/other authorities.

 

24.       the amount borrowed by the Company from directors, members, public, financial institutions, banks and others during the financial year ending ____________ is/are within the borrowing limits of the company and that necessary resolutions as per section 293(1)(d) of the Act have been passed in duly convened annual/ extraordinary general meeting.

 

25.        the company has made loans and investments, or given guarantees or provided securities to other bodies corporate in compliance with the provisions of the Act and has made necessary entries in the register kept for the purpose.

 

26.        the company has altered the provisions of the memorandum with respect to situation of the company's registered office from one State to another during the year under scrutiny after complying with the provisions of the Act.

 

27.        the company has altered the provisions of the memorandum with respect to the objects of the company during the year under scrutiny and compiled with provisions of the Act.

 

28.        the company has altered the provisions of the memorandum with respect to name of the company during the year under scrutiny and complied with the provisions of the Act.

 

29.        the company has altered the provisions of the memorandum with respect to share capital of the company during the year under scrutiny and complied with the provisions of the Act.

 

30.        the company has altered its articles of association after obtaining approval of members in the general meeting held on ___________ and the amendments to the articles of association have been duly registered with the Registrar of  Companies.

 

31.        a list of prosecution initiated against or show cause notices received by the company for alleged offences under the Act and also the fines and penalties or any other punishment imposed on the company in such cases is attached.

 

32.        the company has received Rs. ______________ as security from its employees during the year under certification and the same has been deposited as per provisions of section 41 7(1) of the Act.

 

33.        the company has deposited both employee's and employer's contribution to Provident Fund with prescribed  authorities pursuant to section 418 of the Act.

 

Note :  The Qualification, reservation or adverse remarks, if any, may be stated at the relevant place(s).

 

Place :                                                                          Signature ________________

Date :                                                                           Name of Company Secretary: ______

                                                                                    C.P. No.

 

ANNEXURE A

 

Registers as maintained by the Company

 

1.         __________________ u/s _______________

2.         __________________ u/s _______________

3.         __________________ u/s _______________

 

ANNEXURE B

 

Forms and Returns as flied by the Company with the, Registrar of Companies, Regional Director, Central Government or other authorities during the financial year ending on 31st March, 20

 

1.         Form No. _____________ Filed u/s ____________ for ____________

2.         Form No. _____________ Filed u/s ____________ for ____________

3.         Form No. _____________ Filed u/s ____________ for ____________

 

A. RAMASWAMY

Joint Secretary to the Government of India

 

 

ANNEXURE ‘B’

 

CHECK‑LIST FOR ISSUE OF COMPLIANCE CERTIFICATE GIVEN PARAGRAPH WISE IN SERIAL ORDER

 

Paragraph 1.‑ The company has kept and maintained all registers as stated in Annexure "A' to this certificate, as per the provisions and the rules made thereun­der and all entries therein have been duly recorded.

 

REGISTERS AND RECORDS

 

Following is the list of Registers and Records to be maintained by a company, if applicable. If the registers or records are maintained in electronic form, then at the end of the financial year a print out of registers or records should be taken out and the same should be signed by any director authorised by the Board. The CSP should initial all registers or documents checked by him with some distinctive mark for identification.

 

Check whether the company has maintained the following Registers/Records, applicable to it­-

 

Statutory Registers

 

(a)        Register of Investments under Section 49

                        Check whether:

 

(i)         all investments of the company are held in the name of the company;

 

(ii)        if any investments are not held by the company in its own name as allowed by subsections (2), (3), (4) or (5); whether register of investments not held in company's name has been maintained and the particulars such as the nature, value and such other particulars as may be necessary fully to identify the shares or securities in question and the bank or person in whose name or custody the shares or securities are held have been entered therein;

 

(iii)       the register is kept open for inspection by any member or debenture‑holder without charge, during business hours, subject to reasonable restrictions as may be imposed by the Articles or in general meeting.

 

(b)        Register of Deposits under Rule 7 of the Companies (Acceptance of Deposits) Rules, 1975

Check whether:

 

(i)         the particulars in respect of each depositor have been entered in the register;

 

(ii)        the register has been preserved in good order for a period of eight calendar years from the financial year in which the latest entry was made.

 

Note :  A private company has to maintain register of deposits in respect of deposits accepted/invited from the relatives of directors.

 

(c)        Register of Securities Bought Back under Section 77A

 

Check whether register of securities bought back has been maintained for entering the following particulars, namely, (i) the consideration paid for securities bought back; (ii) the date of cancellation of securities; (iii) the date of extinguishing and physically destroying of securities and such other particulars as prescribed in Form 4B of the Companies (Central Government's) General Rules and Forms, 1956 and Annexure B to the Private Limited Company and Unlisted Public Limited Company (Buy‑back of Securities) Rules, 1999.

 

(d)        Register of Charges under Section 143/Copies of Instruments Creating Charge under Section 136

 

Check whether:

 

(i)         all charges specifically affecting the property of the company and all floating charges on the undertaking or on any property of the company have been entered in the register giving, in each case, the particulars prescribed in sub‑section (1) of section 143 i.e. (a) a short description of the property charged; (b) the amount of charge; and (c) except in the case of securities of bearer, the names of the persons entitled to the charge; and

 

(ii)        copies of instruments creating charges kept in pursuance of section 136 and the register of charges kept in pursuance of section 143 are kept open for inspection as provided in section 144 by any member or creditor without fee, and by any other person on payment of Rs. 10/‑ or such other fee as may be prescribed during business hours subject to reasonable restrictions as imposed by the general meeting.

 

(e)        Register of Members under Section 150 and Index of Members under Section 151

Check whether.

 

 (i)        separate registers for each class of shares are maintained in the format as prescribed under rule 7 of the Companies (issue of Share Certificate) Rules, 1960;

 

(ii)        entries in the register are authenticated by the Secretary or any other person authorised by the Board for the purposes of sealing and signing share certificates;

 

(iii)       declaration made to a company under sub‑section (1), (2) or (3) of section 187C has been noted in its Register of members within 30 days from receipt of declaration;

 

(iv)       an index of members is maintained unless the Register of members is in such a form as in itself constitutes an index, where the company has more than 50 members. The index can be in the form of a card index;

 

(v)        every change made in the Register of members has also been recorded in the index within 14 days; and

 

(vi)       list of beneficial owners, (in case of shares held in depository) is also kept by the company.

 

(f)         Register and Index of Debenture‑holders under Section 152

 

Check whether:

 

(i)         the company has maintained separate registers for each type of debentures and entered therein the particulars prescribed in subsection (1) of section 152 i.e. (a) the name and address, and the occupation, if any, of each debenture holder, (b) the debentures held by each holder, distinguishing each debenture by its number except where such debentures are held with a depository, and the amount paid or agreed to be considered as paid on those debentures; (c) the date on which each person was entered in the register as a debenture holder and (d) the date at which any person ceased to be a debenture holder;

 

(ii)        an index of debenture holders is maintained unless the register of debenture holders is in such a form as in itself constitutes an index, where the number of debenture holders is more than 50. The index can be in the form of a card index;

 

(iii)       every alteration made in the register of debenture holders has been recorded in the index within 14 days;

 

(iv)       list of beneficial owners (in case of debentures held in depository) is also kept by the company.

 

(g)        Foreign Registers of Members or Debenture holders under Section 157

 

Check whether the Articles authorise for keeping a foreign register of members or debenture holders. If yes, check whether:

 

(i)         notice of the situation of the office where registers are kept has been filed with the Registrar within 30 days from the date of the opening of any foreign register;

 

(ii)        notice of the change, if any, in the situation of such office or of its discontinuance was filed with the Registrar within 30 days from the date of such change or discontinuance;

 

(iii)       a duplicate of every foreign register has been kept at the registered office and changes in the register duly entered from time to time;

 

(iv)       the above registers are kept open for inspection and extracts/copies thereof are supplied on receipt of requisition with the prescribed fees.

 

(h)        Registers and Returns under Section 163

 

Check whether:

 

(i)         the register of members, the index of members, the register and index of debenture holders, contracts entered into by a company for the appointment of a manager, managing director and copies of annual returns prepared u/s 159 and 160 together with the copies of certificates and documents required to be annexed u/s 160 and 161 are kept at the registered office of the company;

 

(ii)        if the above registers and returns instead of being kept at the registered office of the company, are being kept at any other place within the city, town or village in which the registered office is situate; whether the other place has been approved by a special resolution and the Registrar was given an advance copy of the proposed special resolution;

 

(iii)       the above registers and returns are kept open for inspection by any member or debenture holder without fee, and by any other person on payment of Rs. 10/‑ or such other fee as may be prescribed, during business hours subject to such reasonable restrictions as the company may impose;

 

(iv)       copy of such register etc. or extract thereof is supplied within a period of ten days against any request received on payment of Re. 1 for every 100 words or fractional part thereof or such other fee as may be prescribed.

 

(i)         Minutes Book of Meetings

 

Please refer to clause (b) under paragraph 4 and clause (c) under paragraph 6.

 

(j)         Minutes Book of Class Meeting/Creditors Meeting

 

Check whether company has held class meetings, debenture holders meetings or creditors meeting. If yes, whether minutes book in respect of these meetings has been properly maintained.

 

(k)       Books of Accounts and Cost Records under Section 209

Check whether:

 

(i)         books of accounts are kept at the registered office. If the same are kept at some other place in India, a Board resolution was passed and Form No. 23AA flied with the Registrar within 7 days of the decision;

 

(ii)        the company is required to maintain cost records. If so, whether cost records are being maintained.

 

(l)         Register of Particulars of Contracts in which Directors are Interested under Section 301

Check whether:

 

(i)         the register is being properly maintained by entering separately particulars as prescribed under sub‑section (1) of section 301 of all contracts or arrangements to which section 297 or section 299 applies;

 

(ii)        the names of the directors voting for or against the contract or off angement and the names of those remaining neutral are recorded;

 

(iii)       entries have been made within 7 days from the date on which contract or arrangement was made. If the company's paid‑up share capital is rupees one crore or more, check whether the previous approval of the Central Government has been obtained for entering into contracts;

 

(iv)       the register specifies in relation to each director the names of firms and bodies corporate of which notice has been given by him under section 299(3);

 

(v)        the register has been signed by the directors present at the Board meeting following the meeting in which the contracts were considered;

 

(vi)       where the above contracts and/or arrangements have been approved by members in their general meeting, the register is maintained and signed in accordance with the terms of the resolution thereat; and

 

(vii)      the register is maintained at the registered office and is kept open for inspection and extracts and copies are permitted to be taken or are given to the members in the same manner and on payment of the same fee as in the case of Register of members.

 

(m)       Register of Directors, Managing Director, Manager and Secretary under Section 303

Check whether:

 

(i)         the necessary particulars prescribed in sub‑section (1) of section 303 and changes therein have been entered in respect of every director, managing director, manager or secretary;

 

(ii)        the names and particulars of companies nominating directors have also been entered in the register; and

 

(iii)       the register is kept at the registered office and is kept open for inspection by members free of charge and by outsiders on payment of fee of Re. I/‑ during business hours subject to such reasonable restrictions as the company may by its Articles or in general meeting impose.

 

(n)        Register of Directors' Shareholdings under Section 307

Check whether:

 

(i)         the register was duly kept at the registered office and contains particulars prescribed in sub‑sections (1), (2) & (3) of section 307 it was kept open for inspection of any member or debenture holder during business hours subject to reasonable restrictions as the company may, by its Articles or in general meeting, impose during the period beginning 14 days before the date of the company's annual general meeting and ending three days after the date of its conclusion, and it was kept open for inspection by any person acting on behalf of the Central Government or of the Registrar during the said period or any other period;

 

(ii)        the register was produced at the commencement of the annual general meeting and was kept open and accessible during the continuation of the meeting to any person having the right to attend the meeting; and

 

(iii)       every director and every person deemed to be a director under section 307(10) has given notice in writing to the company in conformity with section 308 (1) to enable it to comply with the provisions of section 307.

 

(o)        Register of Investments or Loans made, Guarantee Given or Security Provided under Section 372A (w.e.f. 31.10.1998)

 

In case of companies not covered under sub‑section (8) of section 372A, Check whether:

 

(i)         the register has been maintained for entering the following particulars; (a) the name of the body corporate; (b) the amount, terms and purpose of the investment or loan or security or guarantee; (c) the date on which the investment or loan has been made; and (d) the date on which the guarantee has been given or security has been provided in connection with a loan;

 

(ii)        the particulars of every investment or loan made or guarantee given or security provided has been entered chronologically in the register within seven days of the making of such investment or loan, or the giving of such guarantee or provision of such security;

 

(iii)       the register is kept at the registered office of the company; and the register is kept open for inspection and extracts thereof have been supplied to members, if required, on payment of the requisite fee.

 

Note :  If the provisions of section 372A are not applicable to a company, no entries need to be made in the Register of investments or loans made, guarantee given or security provided u/s 372A.

 

(p)        Register of Renewed and Duplicate Certificates under Rule 7 of the Companies (issue of Share Certificates) Rules, 1960

 

Check whether:

 

(i)         the register has been maintained containing prescribed particulars, viz.; the name of the person to whom the certificate has been issued, the number and date of issue of share certificate etc.; and

 

(ii)        all entries in the register have been authenticated by the secretary or any other person authorised by the Board of directors.

 

(q)        Register of Destruction of Records/Documents

            Check whether:

 

(i)         the records and documents are being kept in the company at least for the periods stated in the Companies (Preservation and Disposals of Records) Rules, 1966;

 

(ii)        the company has maintained a register in the prescribed form and has entered particulars of documents destroyed as per rule 4 of the aforesaid Rules.

 

Other Registers

 

Following registers are optional registers and should be maintained as good secretarial practice. However, if the following registers are not maintained, the CSP should not qualify his certificate:

 

(a)        Register of Inspection

 

Check whether the company has maintained the register of inspection containing the following particulars viz. :

 

(i)         Serial Number

 

(ii)        Date

 

(iii)       Name and address of person who has inspected the document

 

(iv)       Particulars of documents inspected

 

(v)        Signature of the person who inspected the documents

 

(vi)       Signature of a director.

 

Note : Maintenance of the said register would help in verifying the compliance of various provisions of the Companies Act, 1956 where records/documents are available for inspection.

 

(b)        Register of Directors' Attendance

 

As per regulation 71 contained under Schedule‑1 (Table "A") to the Companies Act, 1956, every director present at any meeting of the Board or of a Committee thereof shall sign his name in a book to be kept for that purpose. In view of this, companies should maintain a register for recording the attendance of directors present in a meeting of the Board/Committee thereof

 

(c)        Register of Shareholders' Attendance

 

Check whether the company has maintained a register of shareholders' attendance at the general meetings or has kept the attendance slips collected from the members at the meeting.

 

(d)        Register of Proxies

 

Check whether the register of proxies containing details of proxies lodged in respect of every general meeting is maintained.

 

(e)        Register of Transfers

                        Check whether:

 

(i)         The company has maintained separate register of transfers for  different classes of shares/debentures, and entered therein the particulars relating to the registration of transfer of shares/ debentures;

 

(ii)        transfer number as per the register of transfer and date of approval has been entered in the Share Transfer Deed in Form 7B;

 

(iii)       the Company has maintained a separate file of documents like Powers of Attorney, Probate, Letters of Administration and/or Succession Certificate, Resolution of companies or other bodies corporate authorising any particular person(s) to sign on its behalf that are registered with the company; and

 

(iv)       details of nomination forms have been noted.

 

(f)         Register of Fixed Assets

 

Check whether the register of fixed assets has been maintained containing prescribed particulars of quantitative details and situation of fixed assets of the company and its undated written down values.

 

(g)        Register of Documents Sealed

                        Check whether:

 

(i)         the company has maintained a register of documents sealed;

 

(ii)        the register contains the following information :

(a)        number and date of the minutes authorising the use of the seal;

(b)        date of sealing;

(c)        persons in whose presence the seal was affixed;

(d)        document sealed;

(e)        location of document.

 

Paragraph 2.‑The company has duly riled the forms and returns as stated in Annexure "B" to this certificate, with the Registrar of Companies, Regional Director, Central Government, Company Law Board or other authorities within the time prescribed under the Act and the Rules made thereunder.

 

FORMS, RETURNS AND DOCUMENTS

 

To be Filed with the Registrar of Companies

 

Check whether the company has filed with the ROC the requisite forms, returns and documents within the prescribed time or with payment of additional fees in the event of delayed filing. While a detailed list is given in Appendix‑A, check list for verification of frequently filed forms, returns and documents is given hereunder:

 

Periodical Returns

 

(a)        Annual Return

Check whether:

 

(i)         the annual return has been duly flied with the ROC within 60 days of the holding of the annual general meeting;

 

(ii)        where annual general meeting has not been held, the return was flied within 60 days from the date on which the annual general meeting ought to have been held;

 

(iii)       the return has been duly signed and the requisite certificates have been attached as per section 161;

 

(iv)       in case of a company whose shares are listed on a recognised stock exchange, the return is also signed by a secretary in whole‑time practice.

 

Note :

(i)         In case of an adjourned annual general meeting, check whether the annual return incorporates the date of the original meeting.

 

(ii)        detailed guidance can be had from the Institute's publication "Guidance Note on Signing of Annual Return".

 

(b)        Balance Sheet, etc., under section 220

                        Check whether:

 

(i)         the balance sheet, etc., were adopted by the annual general meeting;

 

(ii)        3 copies of balance sheet, etc., were filed with the ROC within 30 days of the date of the annual general meeting;

 

(iii)       where an annual general meeting has not been held, 3 copies of balance sheet etc. were filed within 30 days from the latest day on or before which the meeting should have been held and whether a statement of the fact and of the reasons therefor was filed along with the balance sheet etc.;

 

(iv)       where balance‑sheet etc., were laid before but not adopted by the annual general meeting or the annual general meeting was adjourned without adopting the balance sheet, whether a statement of the fact and reasons therefor was flied along with the balance sheet, etc.

 

(c)        Compliance Certificate under Section 383A

            Check whether:

 

(i)         the company to which proviso to sub‑section (1) of section 383A is applicable has filed with the ROC a certificate from a CSP in Form appended to the Companies (Compliance Certificate) Rules, 2001 within 30 days from the date of annual general meeting.

 

(ii)        in case the annual general meeting of the company is not held for the year, the aforesaid Compliance Certificate has been filed with the ROC within 30 days from the latest day on or before which that meeting should have been held.

 

Other Important Returns

 

(a)        Return of Allotment

                        Check whether:

 

(i)         the company has made any allotment of its shares. If so, the return of allotment in Form No.2 was filed with the Registrar within 30 days stating the number and nominal amount of the shares comprised in the allotment, the names, addresses, and occupations of the allottees, and the amount, if any, paid or due and payable on each share;

 

(ii)        shares were allotted at a discount. If so, copy of the resolution authorising the issue of shares at a discount along with a copy of the order of the Company Law Board was flied with the return;

 

(iii)       shares were issued for consideration other than cash. If so, the original contract, along with a copy thereof, entered into with the persons to whom the shares were allotted for consideration other than cash was filed with the return;

 

(iv)       the copy of the contract was verified by an affidavit by a director or the Secretary of the company;

 

(v)        the contract for issue of shares for consideration other than cash was not reduced in writing. If so, whether particulars of the contract were filed in Form No.3 and the Form was duly stamped with stamp duty which would have been paid, had the contract been reduced to writing;

 

(vi)       bonus shares were issued. If so, a return stating the number and nominal amount of the shares comprised in the allotment, the names, address and occupation of the allottees and a copy of the resolution authorising the issue of such shares was filed;

 

(vii)      allotment has been made in pursuance of the order of the Court under sections 391/394. If so, verify whether shares were allotted in the proportion stated in the order.

 

Notes :

 

1.         The return of allotment is not required to be flied in case the allotment was of forfeited shares or the allotment was made to the subscriber to the Memorandum and Articles of Association.

 

2.         The return of allotment is not required to be flied where debentures are allotted.

 

            (b)        Return on Buy‑Back of Securities

           

Check whether the company has filed with the Registrar, Form No. 4A and 4C under the Companies (Central Government's) General Rules and Forms, 1956 and a return in the form specified at Annexure A to the Private Limited Company and Unlisted Public Limited Company (Buy ‑ Back of Securities) Rules, 1999 after the completion of buy‑back.

 

(c)        Notice of redemption of preference shares, consolidation, division, increase in share capital, cancellation of shares and increase in number of members

Check whether:

 

(i)         the requisite notice in Form No. 5 was filed within 30 days from the day on which any of the aforesaid events occurred or resolution passed as the case may be; and

 

(ii)        requisite registration fees have been paid on the difference between the increased capital and the existing authorised capital at the existing rate.

 

(d)        Notice of Situation/Change in Situation of Registered Office

Check whether:

 

(i)         the notice of situation or the notice of change in the situation of registered office in Form‑ 18 has been flied within 30 days of the date of incorporation or change;

 

(ii)        in addition to the above, check also the following (if applicable):

 

(a)        In the case of change in the situation of the registered office outside the local limits of any city, town or village but within the State and within the jurisdiction of the same ROC, check whether Form No. 23 has been flied along with the copy of special resolution passed by the company;

 

 (b)       In the case of change in the situation of the registered office outside the local limits of any city, town or village though within the same State but from the jurisdiction of one ROC to the jurisdiction of another ROC, check whether:

 

(i)         confirmation from Regional Director has been received;

 

(ii)        the confirmation has been flied with the ROC within two months from the date of confirmation;

 

(iii)       Form No. 23 has been flied within 30 days along with the copy of special resolution passed by the company;

 

(iv)       Form No. 18 has been flied with both the ROCs within 30 days;

 

(v)        the ROC has certified the registration.

 

(c)        In the case of change in situation of the registered office from one State to another, check whether:

 

(i)         Form No. 18 has been flied with both the ROCs;

 

(ii)        Form No.21 has been filed along with the certified copy of the order of the Company Law Board with both the ROCs within three months.

 

(e)        Court/CLB Orders

 

Check whether Form No.21 has been filed with the ROC along with certified copies of the following orders:

 

Section

 

17(2)

Order of the Company Law Board approving the shifting of the regis­tered office from one State to other

79

Order of the Company Law Board approving Issue of shares at dis­count

81(3)

Order of the Central Government approving the terms of issue of de­bentures relating to conversion of debenture or loan into shares

94A(2)

Order of the Central Government permitting public financial institu­tion to convert debentures or loan into shares

102(1)

Order of the Court confirming the reduction of capital

107(3)

Order of the Court disallowing or confirming variation of the share holders' rights

111(5) or 111A

Order of the Company Law Board dismissing the appeal or rejecting the application in respect of refusal of registration of transfer and directing that the transfer or transmission shall be registered by the company/directing the rectification of the register of members

113

Order of the Company Law Board granting extension of time for issue of debenture certificate

141

Order of the Company Law Board extending time for filing particulars of registration, modification or satisfaction of charges or rectifying the register of charges

186

Order of the Company Law Board for a meeting of the company to be called, held and conducted in terms of the Order

391(2)

Order of the Court sanctioning any compromise or arrangement

394(3)

Order of the Court making provisions for several matters specified in section 394(1) for implementing the compromise or arrangement

404(3)

Order of the Company Law Board providing for change in Memoran­dum or Articles.

 

(f)         Registration of Resolutions and Agreements

 

Check whether copies of resolutions and agreements required to be flied along with Form No. 23 with the ROC under section 192 have been filed within 30 days after the passing of the resolution or the making of the agreement.

 

(g)        Return of Appointment of Managing Director/ Whole‑time Director/ Manager

 

Check whether:

 

(i)         a return in form No. 25C is filed within 90 days from the date of appointment of Managing Director or Whole‑time Director/ Manager;

 

(ii)        the certification with respect to compliance of all the requirements of Schedule XIII has been given by the auditor or secretary of the company or where the company has not appointed a secretary then it has been given by the Secretary in whole‑time practice.

 

(h)        Consent to Act as Director of the Company (in the Case of Public Company)

 

Check whether the director other than those specified in sub‑section (2) of section 264 has filed with the Registrar his consent to act as director in Form No. 29 within 30 days of his appointment.

 

Note :  If Form 29 contains an undertaking for acquiring qualification shares, the undertaking should be given on a stamp paper of requisite value.

 

(i)         Particulars of Appointment of Directors, Managing Director, Manager, or Secretary and Changes made [Section 303(2)]

 

Check whether:

 

(i)         the requisite returns in duplicate had been filed with the ROC in Form No. 32 within 30 days of appointment/change in director, managing director, manager or secretary;

 

(ii)        upon the change in particulars of director to a managing/whole‑time director or an additional director being appointed as a director at annual general meeting, the fact has been notified in Form No. 32.

 

(j)         Return of Deposits under Section 58A

 

Check whether :

 

(i)         the company has on or before 30th day of June, flied with the Registrar a return in the form annexed to Companies (Acceptance of Deposits) Rules 1975 duly certified by the auditor of the company;

 

(ii)        a copy of the return has simultaneously been furnished to Reserve Bank of India.

 

(k)       Particulars of Beneficial Interest in Shares

 

Check whether copies of Form‑I and Form‑II along with Form‑III under the Companies (Declaration of Beneficial Interest in Shares) Rules, 1975 have been flied with the ROC, wherever applicable.

 

(l)         Registration of Creation/Modification/Satisfaction of Charge

 

Check whether:

 

(i)         the charge falls within any one of the categories of registrable charges as provided in sub‑section (4) of section 125;

 

(ii)        the prescribed particulars of the charge requiring registration were filed in three copies with the ROC in Form No.8 along with Form No. 13 duly signed by the company as well as the charge‑holder and along with the original/certified copy of the. instrument, if any, within 30 days after the date of, its creation or within the time permitted by the ROC under proviso to sub‑section (I) of section 125 of the Companies Act;

 

(iii)       in case of issue of debentures of a series, if there has been any charge to the benefit of debenture holders of that series, the required particulars have been flied with the Registrar in Form No. 10 along with Form No. 13 (in triplicate) within 30 days from the date of execution of the debentures of the series;

 

(iv)       in case commission, allowance, discount is paid or made in consideration for subscribing, etc., to debentures, whether the forms included particulars of such commission, etc.;

 

(v)        the documents were registered by the ROC and endorsed copies thereof have been obtained;

 

(vi)       abstract of registration is duly endorsed on every debenture or certificate of debenture stock issued, the payment of which is secured by the charge registered;

 

(vii)      particulars of modification of charges were filed in three copies in Form No.8 along with Form No. 13 duly signed with the ROC within 30 days of the modification or within the extended period;

 

(viii)      a copy of the instrument creating/modifying charge/a copy of debenture of the series, if any, required to be registered was kept at the registered office;

 

(ix)       where payment or satisfaction of charge registered has been effected in full, intimation thereof has been sent to the ROC in three copies in Form No. 17 along with Form No. 13 duly signed, by the company as well as the charge‑holder within 30 days from the date of such payment or satisfaction (section 138);

 

(x)        the satisfaction of charge has been registered by the ROC and endorsed copies of documents have been obtained.

 

(xi)       in case of delay/omission/mis‑statement in filing particulars of charge created/modified or issue of debentures of a series or intimation of satisfaction of charge, to the ROC a petition has been made to the Company Law Board in accordance with the Company Law Board Regulations, 1991 and CLB order obtained and certified copy of such order has been furnished to the ROC along with Form No. 21; and

 

(xii)      instruments creating/modifying charges are kept open for inspection as prescribed.

 

To be Filed with other Authorities

 

Check whether forms, returns and documents have been filed with the other authorities mentioned below:

 

(1)        intimation has been  given to the Company Law Board in respect of any default made by the company in repayment of any deposits from small depositors within 60 days from the date of default. Intimation shall he given on monthly basis;

 

(2)        copy of Return of Deposits of a non‑banking non financial company has been flied with the Reserve Bank of India pursuant to rule 10 of the Companies (Acceptance of Deposits) Rules, 1975;

 

(3)        text of Advertisement inviting deposits by a non‑banking financial company has been filed with the Reserve Bank of India pursuant to rule 5 of the Non‑Banking Financial Companies And Misc. Non‑Banking Companies (Advertisement) Rules, 1977;

 

(4)        returns have been filed to the Securities and Exchange Board of India in case of buy‑back of securities;

 

(5)        intimations required to be given to the Official Liquidator/Courts when the company is in the process of winding up/amalganiation/inerger/ reconstruction have been given.

 

Paragraph‑3.‑The company being a private limited company has the minimum rescribed paid‑up capital and its maximum number of members during the said financial year was ____________________            excluding its present and past employees and the company during the year under scrutiny:

 

(i)         has not invited public to subscribe for its shares or debentures; and

(ii)        has not invited or accepted any deposits from persons other than its members, directors or their relatives.

 

STATUS OF THE COMPANY

           

(a)        In case of Private Company

Check whether:

 

(i)         the company has a minimum paid up capital of Rs. 1 lakh or such higher paid‑up capital as may be prescribed. In case of an existing private company this requirement is to be complied within a period of two years from the commencement of the Companies (Amendment) Act, 2000 i.e. 13.12.2000;

 

(ii)        company's Articles contain provisions­

 

(a)        restricting the right to transfer its shares;

 

(b)        limiting the number of members to fifty; and

 

(c)        prohibiting any invitation to public to subscribe its shares/ debentures;

 

(d)        prohibiting any invitation or acceptance of deposits from persons other than its members, directors or their relatives.

 

Note:    The requirement as at (d) above was prescribed by the Companies (Amendment) Act, 2000. Private companies formed before the commencement of the said amendment Act may not contain the clause. Such private companies should therefore be advised to amend the Articles of Association to include this clause.

 

(b)        In case of Private Company which is a Subsidiary of a Public Company

 

Check whether the company has a minimum paid‑up capital of 5 lakh rupees or such higher paid up capital, as may be prescribed. In case of existing public limited company, check that it has enhanced its paid up capital to five lakh rupees within two years from the commencement of the Companies (Amendment) Act, 2000 i.e. 13.12.2000.

 

Note :   A company registered under section 25 before or after the commencement of the Companies(Amendment) Act, 2000 shall not be required to have minimum paid up capital srecified above. However, a guarantee company having share capital should have minimum paid up capital slpecified above.

 

Paragraph‑4.‑The Board of directors duly met __________ times on __________ (dates) in respect of which meetings proper notices were given and the proceedings were properly recorded and signed including the circular resolutions passed in the minutes book maintained for the purpose.

 

 

MEETINGS OF DIRECTORS AND MINUTES

 

(a)        Meetings of Directors

Check whether:

 

(i)         the requisite number of Board meetings as required under section 285 of the Companies Act were held during the year;

 

(ii)        notice of each Board meeting in writing was issued to all the directors;

 

(iii)       attendance‑records are maintained and the requirements of Board meetings regarding quorum, chairman, minutes etc., have been complied with;

 

(iv)       the items required to be transacted only at the meeting of the Board were actually transacted at the meeting (Refer Appendix‑B) and not by way of resolution by circulation or otherwise;

 

(v)        every director has disclosed his interest at the Board meeting where transaction is considered in which he is directly or indirectly interested and the interested director has abstained from participating or voting at such meeting and the notices of disclosure of general interest under section 299 have been received from all the directors before the close of the financial year and placed before and read at the next Board meeting and entries thereof have been made in the Register under section 301 and noted by the Board and renewed every year;

 

Note : Interested directors of a private company need not abstain from participating or voting.

 

(vi)       the Board had constituted any committees; if so whether requireme- nts regarding quorum, chairman, minutes, etc., of committee meetings were duly complied with‑,

 

(vii)      the minutes of committee meetings were regularly placed before the Board for taking note of;

 

(viii)     the draft of the resolutions proposed to be passed by circulation together with necessary papers were circulated to all the directors then in India and their number was not less than the quorum fixed for the Board meeting and to all the other directors at their usual addresses in India;

 

(ix)       the resolution by circulation was approved by requisite number of directors its required under section 289;

 

(x)        the resolutions passed by circulation were put up at the next Board meeting for taking note of.

 

(b)        Minutes Book of Meetings of Directors

Check whether:

 

(i)         minutes books for Board and Committee meetings are maintained in accordance with the provisions of section 193;

 

(ii)        the Proceedings of each meeting are entered within 30 days of the meeting;

 

(iii)       each page of the minutes book is consecutively numbered;

 

(iv)       each page of individual minutes is duly initiailed or signed and the last page of each such minutes is dated and signed by the Chairman of the same meeting or of the next succeeding meeting;

 

(v)        names of directors present at the meeting are recorded in the minutes;

 

(vi)       leave of absence granted is recorded;

 

(vii)      nature of interest of a director in any transaction and also his abstaining from discussion/voting on resolution are recorded;

 

(viii)      names of directors dissenting from or not concurring with the resolution are recorded;

 

(ix)       minutes have not been attached or pasted to the minutes book;

 

(x)        minutes are maintained in loose leaf form; if so whether safeguards against manipulation have been taken and the leaves are bound at reasonable intervals, say six months/one year; and

 

(xi)       the fact that documents or drafts placed before the meeting is recorded in the minutes.

 

Paragraph‑5.‑The company closed its Register of Members and/or Debenture holders from __________ to ________ and necessary compliance of section 154 of the Act has been made.

 

CLOSURE OF REGISTER OF MEMBERS OR DEBENTUREHOLDERS

 

Check whether:

 

(i)         the Register of members or debenture‑holders was closed during the year;

 

(ii)        the period for which it was closed and the dates thereof did not exceed, in the aggregate, forty five days in a year and not for more than thirty days at any one time.

 

(iii)       not less than seven days' previous notice was given by advertisement in some newspaper circulating in the district in which the registered office of the company is situated, to close the register;

 

(iv)       the company has kept foreign register of members or debenture holders; if so, whether an advertisement has been given in some newspaper circulating in the district wherein the foreign register is kept where the company close its register of members/debenture holders.

 

Note :  Normally this register is closed only before the annual general meeting and for other purposes record dates may be fixed only by listed companies. This requirement will not normally apply to a private company).

 

Paragraph‑6.‑The annual general meeting for the financial year ended on __________  was held on __________ after giving due notice to the members of the com­pany and the resolutions passed thereat were duly recorded in Minutes Book main­tained for the purpose.

 

ANNUAL GENERAL MEETING AND MINUTES

 

(a)        Annual General Meeting

Check whether:

 

(i)         first annual general meeting was held within 18 months from the date of incorporation of the company;

 

(ii)        subsequent annual general meetings have been held in each year (calendar year) and the gap between two successive annual general meetings has not been more than 15 months or the period extended by the ROC;

 

(iii)       the provisions of section 210 have been complied with;

 

(iv)       meetings have been called during business hours on a day not being a public holiday and held at the registered office of the company or at any place in the same city, town or village;

 

(v)        provisions of sections 171 to 193 and other requirements e.g., notice, quorum, chairman, proxy, attendance, placing and reading of Auditors' report, placing instruments of proxy, proxy register and register of directors' shareholdings, conduct of meeting and preparation and signing of minutes etc., were complied with.

 

Note :   Provisions of section 171 to 186 do not apply to private companies if the Articles of Association so provide.

 

(b)        Sending of Notices, etc. to the Members

                        Check whether:

 

(i)         a copy of the balance sheet, auditors' report, Boards' report along with a copy of the compliance certificate and other specified documents including notice of the meeting were sent to members, trustees of debenture‑holders, auditors, etc. free of cost at least 21 clear days before the meeting. If sent less than 21 clear days before the meeting whether such shorter period was agreed to by all the members. It' any directions were received from the Central Government for circulation of the cost audit report to the members along with the notice of the annual general meeting, whether the same has been complied with;

 

(ii)        in case the shares of the company are listed on a stock exchange ensure that the company has supplied a copy of the complete and full balance sheet and profit and loss account and the directors report to shareholder as provided under clause 32 of the listing agreement though abridged accounts could be sent pursuant to section 219 (1)(b)(iv) in Form 23AB;

 

(iii)       a copy of the unabridged annual report was sent to members, debenture‑holders and depositors on demand, without charge, within 7 days of the requisition,

 

(c)        Minutes Books of Proceedings of General Meetings

Check whether:

 

(i)         minutes books are properly maintained

-           the proceedings of each general meeting have been entered within 30 days of the meeting;

 

-           the pages of the minutes book are consecutively numbered. Each page is duly initialled or signed and the last page of the record of proceedings of each meeting is dated and signed by the Chairman of the meeting within,30 days of the meeting,

-                 in the event of death/inability of the Chairman to sign minutes of the general meeting, the Board resolution has been passed authorising any director to sign within that period;

-                  the minutes are not attached or pasted. All erasures or alterations are duly authenticated;

-                  the minutes are maintained in loose leaf form; if so whether safeguards against manipulation have been taken and the pages are bound at reasonable intervals, say six months/one year;

-                  and the fact that documents or drafts placed before tire meeting is recorded in the minutes.

 

(ii)        minutes books have been kept at the registered office of the company and kept open during business hours for inspection of members and also, inspection is allowed to any member without charge during business hours subject to such reasonable restrictions as the company may, by Articles or in general meeting impose;

 

(iii)       check if copies of minutes of general meetings were furnished within 7 days of the receipt of request on payment of Re. 1 for every 100 words or fractional part thereof or such other fee as may be prescribed.

 

Paragraph‑7.- ______________ extra ordinary meeting(s) was/were held during the financial year after giving due notice to the members of the company and the resolutions passed thereat were duly recorded in the Minutes Book maintained for the purpose.

 

EXTRA ORDINARY GENERAL MEETING AND MINUTES

 

Check whether :

 

(i)         requirements relating to notice, attendance, Chairman, quorum, proxy, proxy register/instruments of proxy and proper conduct of meeting as well as maintenance of minutes of a general meeting have been complied with;

 

(ii)        in case of meetings oil requisition,

 

(a)        the requisition has set out the matters for consideration and has been signed by n1einbers holding not less than. 1/10th of the paid‑up capital with voting rights or 1/10th of the total voting power. as the case may be,

 

(b)        the Board, within 24 days of deposit of a valid requisition has proceeded to call a meeting on a day within 45 days from the date of deposit of such requisition;

 

(c)        in case the meeting has been called by requisitionists, reasonable expenses incurred by them have been reimbursed by the company and this sum has been covered from tile defaulting directors.

 

Note :  The check list with regard to giving due notice and recording of minutes as far as applicable will be the same as given under paragraph 6(b) and 6(c) above.

 

Paragraph‑8.‑The company has advanced loan amounting to Rs __________ to ______ its directors and/or persons or firms or companies referred in the section 295 of the Act after complying with the provisions of the Act.

 

LOANS TO DIRECTORS

 

Check whether provisions of section 295(2) are applicable. If applicable check whether

 

(a)        any loan has been made to

 

(i)         any director of the company or its holding company,

 

(ii)        any partner or relative of any such director,

 

(iii)       any firm in which any such director or relative is a partner,

 

(iv)       any private company of which any such director is a director or a member,

 

(v)        any body corporate in which 25% or more voting power is exercised by one or more such directors of the company,

 

(vi)       any body corporate whereof, the Board, managing director or manager are accustomed to act in accordance with directions or instructions of the Board or any director(s) of the company .

 

(b)        the previous approval of the Central Government as per section 295 (except housing‑loan to a managing director, as per the guidelines issued by the Central Government) has been obtained.

Note :  Relevant ledger accounts should also be verified.

 

Paragraph‑9.‑The company has duly complied with the provisions of section 297 of the Act in respect of contracts specified in that section

 

BOARD'S SANCTION FOR CERTAIN CONTRACTS

 

Check if exemptions provided in sub‑section (2) of section 297 were applicable. If not check whether:

 

(i)         Board of directors' consent was obtained by a resolution passed at a meeting for entering into contracts in which directors were interested;

 

(ii)        Regional Director's prior approval was obtained if the paid‑up share capital of the company was not less than rupees one crore;

 

(iii)       the particulars of contract were entered in the register of contracts in accordance with section 301.

 

Note :  Relevant ledger accounts should also be verified.

 

Paragraph‑ 10.‑ The company has made necessary entries in the register maintained under section 301 of the Act.

 

ENTRIES IN REGISTER OF CONTRACTS

 

Check whether:

 

(i)         the register is being properly maintained by separately entering particulars as prescribed under sub‑section (1) of section 301 of all contracts or arrangements to which section 297 or section 299 applies;

 

(ii)        the names of the directors voting for or against the contract or arrangement and the names of those remaining neutral are recorded;

 

(iii)       entries have been made within 7 days from the date on which contract or arrangement was made. If the company's paid‑up share capital is rupees one crore or more, check whether the previous approval of the Central Government has been obtained for entering into contracts;

 

(iv)       the register specifies in relation to each director the names of firms and bodies corporate of which notice has been given by him under section 299(3);

 

(v)        the register has been signed by the directors present at the Board meeting following the meeting in which the contracts were considered;

 

(vi)       where the above contracts and/or arrangements have been approved by members in their general meeting, the register is maintained and signed in accordance with the terms of the resolution thereat; and

 

(vii)      the register is maintained at the registered office and is kept open for inspection and extracts and copies are permitted to be taken or are given to the members in the same manner and on payment of the same fee as in the case of Register of members.

 

Note :  Relevant ledger accounts should also be verified.

 

Paragraph‑11. ‑ The company has obtained necessary approvals from the Board of directors, members and previous approval of the Central Government pursuant to section 314 of the Act wherever applicable.

 

HOLDING OFFICE OR PLACE OF PROFIT

 

Check whether:

 

(i)         a director of the company and others referred to in clause (b) of sub‑section (1) of section 314 hold any office or place of profit;

 

(ii)        necessary declaration was obtained from persons referred to in sub‑section (2A) of section 314;

 

(iii)       a prior special resolution was duly passed at the general meeting and Form No. 23 was duly filed with the Registrar;

 

(iv)       prior approval of the Central Government was obtained where monthly remuneration paid was not less than Rs. 20,000/‑, or as may be prescribed;

 

(v)        the concerned person vacated his office immediately and refunded the remuneration received from the company if the Central Government's permission was either not obtained or denied.

 

Note :  Relevant ledger accounts should also be verified.

 

Paragraph‑ 12.‑The Board of directors or duly constituted Committee of directors has approved the issue of duplicate share certificates.

 

ISSUE OF DUPLICATE SHARE CERTIFICATES

 

Check whether

 

 (i)        if both strength and quorum of the Committee of directors constituted under rule 3(b) of the Companies (Issue of Share Certificates) Rules, 1960, are not less than 3 directors where the total number of directors of the company exceeds 6 and not less than 2 directors where the total number does not exceed 6 and to the extent the composition of the Board of directors permits, half of the number of members of the Committee are directors other than a managing director or whole‑time director;

 

(ii)        the Board resolution for issue of duplicate share certificates;

 

(iii)       duplicate certificates have been issued with the prior consent of the Board or Committee thereof as also in accordance with the provisions of section 84 of the Act;

 

(iv)       the form of certificate including split/consolidated/replaced/ duplicate issued conforms to rule 5 of the said Rules;

 

(v)        certificates issued by the company comply with rule 6 of the said Rules as to affixing seal and signing of certificates;

 

(vi)      

(a)        particulars of every share certificate issued in the Register of members have been recorded;

 

(b)        particulars of every share certificate issued for split/ consolidation or duplicate certificate issued are recorded in the register of renewed/consolidated and duplicate certificate issued;

 

(c)        all entries made in the Register of members or register of renewed or duplicate certificates have been authenticated by the Secretary or such other persons as may be appointed by the Board.

 

(vii)      the company has a good internal control system for blank form of share certificate and all certificates issued and blank stationery have been periodically accounted to the Board;

 

(viii)      all books and documents relating to the issue of share certificates have been preserved in good order permanently;

 

(ix)       appropriate indemnity bond and affidavit have been obtained.

 

Paragraph‑13.‑The company has:

 

(i)         delivered all certificates on allotment of securities and on lodgement thereof for transfer/transmission or any other purpose in accordance with the provisions of the Act.

 

(ii)        deposited the amount of dividend declared including interim dividend in a separate bank account on __________ which is within five days from the date of declaration of such dividend.

 

(iii)       paid/posted warrants for dividends to all the members within a period of 30 (Thirty) days from the date of declaration and that all unclaimed/unpaid dividend has been transferred to Unpaid Dividend Account of the Company with ________ Bank on _________

 

(iv)       transferred the amounts in unpaid dividend account, application money due for refund, matured deposits, matured debentures and the interest accrued thereon which have remained unclaimed or unpaid for a period of seven years to Investor Education and Protection Fund.

 

(v)        duly complied with the requirements of section 217 of the Act.

 

ISSUE OF CERTIFICATES, TRANSFER/TRANSMISSION OF SHARES, DIVIDEND, BOARD'S REPORT

 

(a)        Issue of Certificates for Shares and other Securities

Check whether:

 

(i)         the company has allotted shares and entered the names of allottees in its register of members;

 

(ii)        the company has issued and delivered share‑certificates as per sections 83 and 113 of the Act and the provisions of the Companies (issue of Share Certificates) Rules, 1960;

 

(iii)       the company has executed Debenture Trust Deed in case of secured debentures;

 

(iv)       the company has delivered debenture‑certificates within the prescribed period and in case of delay, CLB Order for extension of time has been obtained;

 

(v)        the company has registered transfer and transmission of shares as per sections 108 to 113;

 

(vi)       the company has kept in abeyance the registration of transfers in cases of Court injunction.

 

(b)        Transfer and Transmission of Shares

 

1.         Transfer of Shares

 

Check whether:

 

(i)         the requirements contained in the Articles of Association have been complied with;

 

(ii)        the transfer of shares/debentures and the issue of certificates thereof have been made within the stipulated time under sections 108 and 113 in accordance with the procedures prescribed;

 

(iii)       in respect of transfer deeds reported lost, the company has registered transfer of shares based on an application in writing on stamp paper of the required value with indemnity duly executed by the transferee to the satisfaction of the Board in accordance with the first proviso to section 108 (1);

 

(iv)       transfer applications duly executed by the transferor and transferee completed in all respects are delivered to the company within the validity period mentioned in section 408(IA);

 

(v)        share transfer application is in Form 7B/7BB, as the case may be;

 

(vi)       a notice had been sent to the transferee in case of partly paid shares;

 

(vii)      requisite permission under section 108A, 108B and 108C has been obtained from the Central Government in applicable cases;

 

(viii)      any directions issued by the Central Government under section 108D has been complied with;

 

(ix)       nomination of shares/debentures received under section 109A has been duly noted on relevant registers by the company;

 

(x)        the shares/debentures have not been registered in the name of a firm, HUF, trust (unless registered under Societies Registration Act, 1860), in view of the provisions under section 153;

 

(xi)       certification of transfer was done in accordance with the provisions under section 112. If yes, check whether the certification on the instrument of transfer to the effect "certificate lodged" was done by a duly authorised person; and

 

(xii)      all transfers have been properly included in the Annual Return.

Note :  CSP should also verify entries in the register of transfers.

 

II.         Transmission of shares

            Check whether:

 

(a)        the shares have been transmitted to the legal representative of the deceased shareholder in the case of death of a sole shareholder and in the case of joint holdings only to the survivor(s);

 

(b)        transmission of shares is effected upon the production of succession certificate or probate or letter of administration or indemnity duly signed by the legal heirs of the deceased or as per procedure stipulated by the Board of directors and/or Articles of Association.

 

(c)        Declaration, Payment and Transfer of Dividend

Check whether:

 

(i)         dividends were declared out of profits after providing for depreciation according to the provisions of section 205(2);

 

(ii)        specified minimum amount has been transferred to reserves according to the Companies (Transfer of Profits to Reserves) Rules, 1975;

 

(iii)       Board resolution recommending dividend has been passed;

 

(iv)       the Board has authorised the opening of a separate Bank Account for payment of dividend;

 

(v)        the amount of dividend including interim dividend was deposited in the separate Bank Account within 5 days from the date of declaration of such dividend;

 

(vi)       register of members was closed as per the provisions of section 154;

 

(vii)      interim dividend, if any, declared by the Board of directors has been confirmed/noted at the annual general meeting;

 

(viii)      dividend recommended by the Board was declared at the annual general meeting;

 

(ix)       dividend warrants were printed, signed and despatched to the registered shareholders within 30 days of declaration;

 

(x)        permission of Reserve Bank of India, if required was obtained before dividend was remitted to foreigners/non resident Indians;

 

(xi)       stock exchanges were duly intimated, in case of listed company;

 

(xii)      voluntary transfer to reserves, if any, was made according to the Companies (Transfer of Profits to Reserves) Rules, 1975;

 

 (xiii)     in case of inadequacy of profits, the Companies (Declaration of Dividends out of Reserves) Rules, 1975, were complied with or previous approval of the Central Government was obtained, before such declaration;

 

(xiv)     dividends were paid in accordance with section 206 only to the registered shareholder or his order or to his bankers. In case of a share warrant, dividend has been paid to the bearer of such warrant or to his bankers;

 

(xv)      unpaid or unclaimed dividend was transferred to the unpaid dividend account within 7 days after the expiry of 30 days from the date of declaration (section 205A);

 

(xvi)     amount of dividend remaining unpaid and unclaimed for seven years from the date they became due for payment has been transferred to the Investor Education and Protection Fund, established by the Central Government pursuant to section 205C and while transferring the amount, the company furnished a statement in the prescribed form under section 205A(6).

 

(d)        Board's Report

Check whether

 

(i)         a Board resolution was passed authorising chairman or other directors to sign the report on behalf of the Board;

 

(ii)        the report was duly signed by persons authorised to sign; (iii) the Board's report was attached to the balance sheet;

 

(iv)       the report contained specified particulars viz. state of affairs of the company, proposed transfer to reserves, proposed dividend, material changes affecting the financial position, conservation of energy, technology absorption, etc.;

 

(v)        the Board's report includes a statement showing employees' particulars in accordance with the Companies (Particulars of Employees) Rules, 1975;

 

(vi)       the Boards' report includes a Directors' Responsibility Statement, about:

‑           following applicable accounting standards

‑           consistent application of accounting polices

‑           maintenance of adequate accounting records

‑           preparation of annual accounts on going concern basis

 

(vii)      in the case of a Non‑Banking Financial Company, a Residuary Non‑banking company, the Board's report includes details required to be furnished under Non‑Banking Financial Companies (Reserve Bank) Directions, 1988/ Residuary Non‑Banking Companies (Reserve Bank) Directions, 1987, as the case may be;

 

(viii)      in case the company has passed a special resolution authorising it to purchase its own securities (Buy‑back) pursuant to section 77A and the Buy‑back has not been completed within the time specified (12 months from the date of the resolution), the reasons for failure have been specified;

 

(ix)       a copy of the Compliance Certificate issued by a CSP was allached to the Board's report;

 

(x)        the Board's report gives the fullest information and explanations on every reservation, qualifications or adverse remarks, if any contained in the auditors' report;

 

(xi)       changes in the directors of the company have been reported.

 

(e)        Transfer of Unpaid Amounts to the Investor Education and Protection Fund

 

Check whether the company has duly transferred the following amounts to the Investor Education and Protection Fund :

 

(i)         amounts in the unpaid dividend accounts of the company;

 

(ii)        the application money received by the company for allotment of any securities and due for refund;

 

(iii)       matured deposits with the company;

 

(iv)       matured debentures with the company;

 

(v)        interest accrued on the amounts referred to in clauses (i) to (iv) above;

 

If such amounts have remained unclaimed and unpaid for a period of seven years from the date they became due for payment.

 

Paragraph‑14.‑The Board of directors of the company is duly constituted and the appointment of directors, additional directors, alternate directors and directors to fill casual vacancies have been duly made.

 

APPOINTMENTS OF DIRECTORS

 

Check whether:

 

(a)        the appointment conforms to the provisions contained in the Articles;

 

(b)        the company has the minimum number of directors ‑ three in the case of a public company and two in the case of a private company;

 

(c)        if the number had fallen below the minimum, whether action was taken to bring the number to the minimum;

 

(d)        if it is a new company, check if the first directors were appointed in accordance with the Articles;

 

(e)        in the case of a public company whether the provisions of sections 255 and 256 have been duly complied with;

 

(f)        persons other than retiring directors who were candidates for directorship at the general meeting had given not less than fourteen days notice and made a deposit of Rs. 500/‑ per candidate and had also complied with the provisions of section 257;

 

(g)        in the case of a public company if the number of directors has been increased beyond 12, approval of the Central Government under section 259 has been obtained;

 

(h)        if the Board has filled up casual vacancy among directors appointed in general meeting, the appointment was in accordance with the Articles and was made at a meeting of the Board;

 

(i)         if the Board has appointed any alternate/additional director during the year under sections 313 and 260 respectively, the appointment was in accordance with the Articles;

 

(j)         if any nominee director has been appointed during the year, the appointment is in consonance with the provisions of the Articles of the company;

 

(k)        the company has complied with the provisions of section 265 where it has adopted principle of proportional representation for appointment of directors;

 

(l)         in the case of a public company, check whether it has secured Central Government approval as required under section 268 for an amendment of any provision relating to the appointment or reappointment of managing or whole‑time director or of a director not liable to retire by rotation;

 

(m)       directors other than those referred to in sub‑section (2) of section 264 had given consent to act as director within 30 days of his appointment and the consent was filed with the ROC in Form No. 29;

 

(n)        none of the directors suffers from any of the disqualifications with reference        to section 274;

 

(o)        none of the directors is holding directorships in more than 15 companies subject to provisions of section 278 of the Act;

 

(p)        the office of any director stands vacated on account of any of the disqualifications specified in section 283 or contravention of the provisions of section 314(1);

 

(q)        in the case of a private company, the office of any director stands vacated on account of any of the additional grounds specified in the Articles of Association; and

 

(r)        If any director was removed before the expiry of his term of office, in accordance with the provisions of section 284 such director was not appointed afresh by the Board of directors as per proviso to section 284(6).

 

Paragraph‑15.‑ The appointment of Managing Director/Whole‑time Director/ Manager has been made in compliance ‑with the provisions of section 269 read with Schedule XIII to the Act and approval of the Central Government has been obtained in respect of appointment of ___________ not being in terms of Schedule XIII.

 

APPOINTMENT OF MANAGERIAL PERSONNEL

 

Check whether:

 

(i)         The appointment conforms to provisions contained in the Articles;

 

(ii)        the appointment was made in accordance with the provisions of section 269;

 

(iii)       appointment had been made pursuant to Schedule‑XIII (a) the appointee has furnished a declaration or otherwise stated that he satisfies the conditions specified in Part I of Schedule XIII; (b) the appointment was in accordance with the conditions specified in Schedule XIII; (c) return in Form No.25C was filed with the Registrar within 90 days of the date of appointment; (d) the appointment had been approved by the members in general meeting; (e) in case of appointment of managing director, Form No. 23 was filed with the ROC within 30 days; (f) Form No. 32 has been flied in duplicate; and (g) in case the appointee had not completed the age of 25 years, but had attained the age of majority or had attained the age of 70 years, his appointment had been approved by a special resolution and Form No. 23 was filed with the ROC;

 

(iv)       the appointment required the approval of the Central Government; if so whether application in Form No. 25A seeking the approval of the Central Government was made within ninety days of the appointment and whether the approval of the Central Government has been received;

 

(v)        the managing director or whole‑time director does not suffer from any of the disqualifications specified in sections 274 and 267. In the case of manager, check with reference to section 385;

 

(vi)       remuneration paid to Managing/Whole‑time Director/Manager is in accordance with the provisions of the Act and terms and conditions of approval;

 

(vii)      the provisions of section 316/386 where applicable, have been complied    with.

 

Paragraph‑16.‑ The appointment of sole‑selling agents was made in compliance of the provisions of the Act.

 

APPOINTMENT OF SOLE SELLING AGENTS

 

Check whether:

 

(i)         the company has complied with provisions of section 294 for appointment of sole selling agents and verify that such appointment is not prohibited under section 294AA;

 

(ii)        Form No. 23 has been duly filed;

 

(iii)       the agreement/resolution states specifically that the appointment shall cease to be valid if it is not approved by the company in the first general meeting held after the date on which appointment is made;

 

(iv)       Central Government required the company to furnish to it information regarding terms and conditions of the appointment of sole selling agent and if so verify whether necessary information was furnished;

 

(v)        the Central Government varied the terms and conditions of sole selling agent and if so whether the same were complied with;

 

(vi)       previous approval of the Central Government has been obtained where the individual firm or body corporate appointed as sole selling agent had substantial interest in the company;

 

(vii)      approval by special resolution and of the Central Government was obtained for appointment of sole selling agent where the paid‑up share capital of the company was Rs. 50 lakhs or more.

 

Paragraph‑17.‑The company has obtained all necessary approvals of the Central Government, Company Law Board, Regional Director, Registrar or such‑other authorities as may be prescribed under the various provisions of the Act as detailed below:

 

APPROVALS OF VARIOUS AUTHORITIES

 

MATTERS REQUIRING APPROVALS OF CENTRAL GOVERNMENT

 

S. No.

Section

Remarks

1.

58A(8)

Company deposits: extension of time for compliance with section 58A.

2.

81(3)(b)

Authorisation to issue debenture/raise loans with conversion clause.

3.

114(1)

Issue of share warrants to bearer.

4.

149(2B)

Commencement of business by company.

5.

198(4)

Remuneration to managerial personnel in case of loss etc

6.

204(1) Proviso

Initial appointment of a firm/body corporate to or in an office or place of profit for a term not exceeding ten years.

7.

205(i) Proviso (c)

Payment of dividends without providing for depreciation.

8.

205(2)(c)

Provision of depreciation on basis approved by Government

9.

205(2)(d)

Provision of depreciation on assets for which no rate has been prescribed.

10.

205A(3)

Dividend out of accumulated profits.

11.

208(3)

Payment of interest out of capital.

12.

211(4)

Modification of requirements of Schedule VI.

13.

212(8)

Non application of section 212 to a subsidiary.

14.

213(1)

Modification of financial year of holding/subsidiary company.

15.

228(4)  

Audit of accounts of branch office exemption from operation of section 228.

16.

233B(2)

Appointment of cost auditor.

17.

259

Increase in number of directors.

18.

268

Amendment of provision relating to managing, whole‑time or non­ rotational directors.

19.

269

Appointment of managing/whole‑time directors or manager.

20.

294AA(2)

Appointment of a person as sole selling agent which has a substantial interest in the company.

21.

294AA(3)

Appointment of sole selling agent by company having paid‑up share capital of Rs. 50 lakhs or more.

22.

295(1)

Loans to directors.

23.

300(3)

Interested director ‑ exemption/ modification of provision of section 300.

24.

309(1) Proviso (b)

Remuneration to professional directors. Opinion of Government regard­ing professional Qualifications of director.

25.

309(3)

Remuneration to directors.

26.

309(5B)

Waiver of recovery of sum refundable by directors.

27.

310

Increase in remuneration of directors.

28.

311

Increase in remuneration of managing/whole‑time director.

29.

314(1B)

Holding office or place of profit by a relative or partner etc. of a director or manager.

30.

314(2)(b)

Waiver of recovery of excess remuneration paid to directors.

31.

316(4)

Appointment as a managing director of more than two companies.

32.

385(2)

Removal of disqualification of manager.

33.

386(4)

Appointment of a person as manager for more than two companies.

34.

387 Proviso

Remuneration to manager in excess of prescribed limit.

35.

396A

Destruction of books of amalgamated company.

36.

594

Accounts of foreign company ‑ exemption from section 594.

 

1846 § App. 42            Guidance Note on Compliance Certificate

 

MATTERS REQUIRING ORDERS OF COMPANY LAW BOARD

 

S. No.

Section

Remarks

1.

17(2)

Confirmation of alteration in Memorandum of Association as to change of place of its registered office from one State to another.

2.

18(4)

Extension of time for filing document for registration of alteration.

3.

19

Revival of order made under section 17.

4.

43

For relief from consequences of failure to comply with conditions con­stituting it a private company.

5.

79(2)

To sanction issue of shares at a discount.

6.

80A(1)

To give consent to issue of further redeemable preference shares in lieu of irredeemable preference shares.

7.

111 or 111A

Rectification of Register of members on any ground including refusal of registration of transfer/transmission of shares/ debentures by the company.

8.

113(1)

For extending the period for delivery of certificate of debenture.

9.

141(1) & (3)

For extension of time or condonation of delay in filing the particulars of charges or modification of charges and intimation of satisfaction of charges with ROC.

 

10.

186

For ordering for calling of general meeting (other than annual general meeting).

11.

188(5)

For order as to whether the rights conferred are being abused to secure needless publicity for defarnatory matter and to order company's costs to be paid in whole or in part by the requisitionists.

12.

225(3) Proviso

To decide as to whether right of auditors to get their representation circulated and read out at meeting, is being abused to secure needless publicity for defamatory matter and to order company's costs on an application to be paid in whole or in part by retiring auditors.

13.

284(4) Proviso

To decide as to whether the rights of a director to get his representation circulated and read out in meeting is being abused to secure needless publicity for defamatory matter and to order company's costs on application to be paid in whole or in part by such director.

 

14.

407(1)(b)

To grant leave for an appointment of managing director or manager whose agreement has been terminated or set aside provided notice has been served on Central Government.

 

 

MATTERS REQUIRING APPROVALS OF REGIONAL DIRECTOR

 

           

S. No.

Section

Remarks

1.

17A

Change of registered office frorn the jurisdiction of one ROC to the jurisdiction of another ROC within the same State.

2.

25

Power to dispense with 'Limited' in the name of the company

3.

224 (3), (7), 8(a)

Appointment of auditors in certain circumstances

4.

297(1)

Contracts in which particular directors are interested

 

MATTERS REQUIRING APPROVAL OF REGISTRAR OF COMPANIES

 

S. No.

Section

Remarks

1.

21

Change of name by company

2.

31(1)

Alteration in the Articles for converting public company into a private company

3.

43A(2A)

Converting a public company (Section 43A company) into a private company

4.

572

Change of name for purposes of registration under Part IX of the Act.

 

Paragraph‑18.‑The directors have disclosed their interest in other firms/ companies to the Board of directors pursuant to the provisions of the Act and the rules made thereunder.

 

DISCLOSURE OF INTEREST BY THE DIRECTORS

TO THE BOARD OF DIRECTORS

 

Check whether:

 

(i)         every director has disclosed his interest at the Board meeting where transaction is considered in which he is directly or indirectly interested,

 

(ii)        the notices of disclosure of general interest under section 299 if received from any director in Form No. 24AA in the last month of the financial year has been placed before and read at the next Board meeting;

 

(iii)       entries thereof have been made in the register under section 301, noted by the Board;

 

(iv)       such notice under section 299 if not given at the meeting of the Board, whether it was brought up and read at the meeting of the Board next after it was given;

 

(v)        any director who has been appointed as director of another company during the year has made disclosure thereof in terms of section 305 of the Act.

 

Paragraph‑19.‑The company has issued _________ shares/ debentures/other se­curities during the financial year and compiled with the provisions of the Act.

 

ISSUE OF CAPITAL AND SECURITIES

 

(a)        In Case of Private Companies

            Check whether:

 

(i)         the relevant provisions in Articles of Association have been complied with and the increase is within the authorised capital of the company;

 

(ii)        the company has Issued equity share capital with differential rights as to dividend voting or otherwise, if any;

 

(iii)       return of allotment was filed with the ROC in Form No. 2 in accordance with the provisions of section 75;

 

(iv)       the register of shareholders/members has been properly maintained and the number of shareholders are not more than 50;

 

(v)        share certificates, have been issued to the allottees in accordance with the Companies (issue of Share Certificates) Rules, 1960 within the prescribed period; and

 

(vi)       where the company has issued preference shares, provisions of sections 80(5A) and 80A have been complied with,

 

(vii)      the company has privately placed Debentures and if So it has complied with provisions of section 117C and a copy of the Trust Deed has been forwarded on payment of requisite fee to any member or debenture‑holder,

 

(viii)      the company, which has cornpicted a buy‑back of its shares or other specified securities has not made further issue of the same kind of securities in the last 24 months as stipulated in section 77A(8).

 

(b)        In Case of Public Companies

 

Check whether:

 

(i)         at the first instance the shares are offered to the existing shareholders in proportion to the capital paid‑up on shares held;

 

(ii)        in case shares are offered to any persons whether or not those persons include existing shareholders in any manner whatsoever:

 

(a)        special resolution was passed; or

 

(b)        else the votes cast in favour of the resolution exceeded the votes cast against the proposal and the approval of the Central Government was obtained;

 

(c)        in case of special resolution, Form No. 23 was flied with the ROC;

 

(d)        in case of Public Issue, separate Bank Accounts have been opened and whether Board resolutions have been passed.

 

(iii)       the company has issued equity share capital with differential rights as to dividend, voting or otherwise, if any, in accordance with the Rules prescribed by the Central Government,

 

(iv)       the Board has approved tile draft prospectus/letter of offer of rights/ offering circular (restricting circulation to below 50 persons) before issue;

 

(v)        the appointments of all the agencies dealing with the issue were duly approved by the Board;

 

(vi)       Initial listing application/s has/have been flied with the Stock Exchanges before filing the prospectus with the ROC;

 

(vii)      minimum subscription has been raised;

 

(viii)      the company has received the minimurn subscription in terms of guidelines issued in this regard;

 

(ix)       the basis of allotment has been approved by the Regional Stock Exchange;

 

(x)        in the case of listed companies permission for listing of securities has been received from all the Stock Exchanges mentioned in the prospectus.

 

(xi)       refund orders were sent in time;

 

(xii)      listing agreements were signed with the Stock Exchanges where the shares were to be listed and the executant on behalf of the company had the authority from the Board and whether listing/trading permissions have been obtained;

 

(xiii)      in case debentures have been issued with an option to convert whole or part into shares, check the applicability of the Public Companies (Terms of Issue of Debentures and Raisinc, of Loans with Option to Convert such Debentures and Loans into Shares) Rules, 1977;

 

(xiv)     the company which has completed a buy‑back of its shares or other specified securities has not made further issue of the same kind of securities in the last 24 months as stipulated in section 77A(8).

 

(c)        Preferential Issue by Listed Companies

 

Check whether listed company has issued capital by way of' sharcs/FCDs/ PCDs or any other financial instruments on a preferential basis which would be converted into or exchanged with equity shares at a later date to any select group of persons if yes, then:

 

(i)         check that the issue was not offered to more than 50 persons in conformity with subsection (3) of section 67;

 

(ii)        in case shares are offered to any persons whether or not those persons include existing shareholders 'in any manner whatsoever

 

(a)        special resolution was passed; or

 

(b)        else the votes cast III favour of the resolution exceeded the votes cast against the proposal and tile approval of the Central Government was obtained,

 

(c)        in case of special resolution, Form No. 23 was filed with the ROC.

 

(d)        Issue of Debentures

 

Check whether:

 

(i)         the company has appointed one or more debenture trustees before issue of prospectus or letter of offer to the public for subscription of its debentures;

 

(ii)        the debenture trustee does not suffer from any of the disqualifications with reference to the provisions of proviso to section 117B(1);

 

(iii)       the company has stated on the face of such prospectus or letter of offer that the trustees have given their consent;

 

(iv)       a Trust Deed has been executed within such period and in such form as prescribed for securing any issue of debentures;

 

(v)        a copy of Trust Deed is made available for inspection to any member or debenture holder;

 

(vi)       a copy of the Trust Deed has been forwarded on payment of requisite fee to any member or debenture‑holder;

 

(vii)      the company has complied with the Order of the Company Law Board, if any, with regard to incurring of any further liabilities;

 

(viii)      the company had re‑issued the redeemed debentures in accordance with section 121; if so, check that such re‑issue was not prohibited by company's Articles, in the conditions of issue or in any contract entered into by the company or the company has manifested its intention that the debentures shall be cancelled.

 

(e)        Issue of Sweat Equity Shares

 

Check whether:

 

(i)         at least one year has elapsed since the date on which the company was entitled to commence business,

 

(ii)        that the sweat equity shares issued are shares only of a class already issued;

 

(iii)       that a special resolution was passed at a general meeting authorising the issue;

 

(iv)       also that the special resolution specified the number of shares, current market price, consideration, if any, and the class or classes of directors or employees to whom such shares are to be issued;

 

(v)        whether the company has flied Form No. 23 with the ROC along with a copy of the resolution within 30 days from the date the resolution was passed,

 

(vi)       if the company is an unlisted company, that the issue of sweat equity shares was in accordance with the guidelines as prescribed by the Central Government.

 

If the Company is a Listed Company

 

Check:

 

(vii)      the company had forwarded 3 copies of the notice and one copy of the proceedings of the general meeting to the stock exchange;

 

(viii)      that the issue was in accordance with the regulations ipade by SEBI in this regard;

 

(ix)       if the shares were issued for consideration other than cash, the Articles of the company permit the same.

 

(f)         Capitalisation of Profit/Issue of Bonus Shares

 

Check whether :

 

(i)         Articles of Association of the company provide for capitalisation of profits;

 

(ii)        requisite resolution was passed by the shareholders in their meeting for capitalisation of profits and issuing bonus shares,

 

(iii)       bonus issue is made out of free reserves built out of genuine profits or share premium collected in cash only and reserves created by revaluation of fixed assets are not capitalised;

 

In the Case of Listed Company, also check whether:

 

(iv)       Guidelines issued by SEBI relating to Bonus shares for disclosure and investor protection have been duly compiled with,

 

(v)        issue of bonus shares is not made prior to 12 months after a public/rights Issue.

 

(vi)       the bonus proposal has been implemented within six months from the date of Board's approval.

 

(g)        Calls on Shares/Debentures

 

Check whether:

 

(i)         call on shares/debentures was made by the Board of directors by, means of resolutions passed at the Board meeting as required Linder section 292(1)(a);

 

(ii)        call on shares/debentures complied with the Stipulations contained in the Articles of Association:

 

(iii)       the Board of directors approved the rate of interest payable on delayed payment of calls in conformity with the provisions contained in the Articles of Association.

 

 (h)       Forfeiture and Re‑issue of Shares

 

(a)        Forfeiture

            Check whether:

 

(i)         the company has forfeited shares during the year in accordance with provisions contained in the Articles;

 

(ii)        necessary noting/recording has been done in the Register of members and other registers.

 

(b)        Re‑issue of Forfeited Shares

            Check whether:

 

(i)         the company has reissued the forfeited shares and if so, the re‑issue has been done in accordance with the provisions contained in the Articles;

 

(ii)        the aggregate of the amount received on forfeited shares and amount received on the reissue of those forfeited shares was not below the issue price of the original shares which were duly forfeited;

 

(iii)       share certificates have been issued to the allottee(s) and necessary entries made in the Register of members.

 

Note :  There is no need to file return of allotment with ROC for reissue of forfeited shares.

 

Paragraph‑20.‑The company has bought back __________ shares during the financial year ending _________ after complying with the provisions of the Act.

 

BUY‑BACK OF SHARES/SECURITIES

 

If the company has bought back any shares/securities, check whether:

 

(i)         the Articles authorise buy back of securities;

 

(ii)        a special resolution was passed at a general meeting approving the buy‑back of securities and the same was filed along with Form No. 23 with the ROC within 30 days from the date of passing the resolution;

 

(iii)       the buy‑back was made only out of the company's free reserves, securities premium account, the proceeds of any shares or other specified securities;

 

(iv)       the buy‑back was not made out of the proceeds of an earlier issue of the same kind of shares/securities;

 

(v)

(a)        the aggregate value of buy‑back was not exceeding 25% of the total paid‑up capital and free reserves of the company.

 

(b)        if the buy‑back was of equity shares in the financial year, it did not exceed 25% of the total paid‑up equity capital in that financial year.

 

(c)        all the shares/securities so bought back were fully paid‑up.

 

(d)        the ratio of debt including all amounts secured and unsecured owed by the company was not more than twice the capital and its free reserves after such buy‑back, except where a higher ratio has been prescribed by the Central Government for a class or classes of companies.

 

(vi)       the buy‑back process was completed within 12 months from the date of passing of the special resolution; if it was not completed within the stipulated time also check whether the reasons thereof were stated in the Board's report;

 

(vii)      If the Company is an Unlisted Public Limited Company or a Private Limited Company,

Check whether:

 

(a)        the buy‑back was made in accordance with the Private Limited Company and Unlisted Public Limited Company (Buy‑back of Securities) Rules, 1999 issued by the Department of Company Affairs;

 

(b)        the company had passed a special resolution and an explanatory statement was annexed to the notice containing disclosures as specified in Schedule 1 to the Rules;

 

(c)        a draft letter of offer containing particulars specified in Schedule 11 to the Rules was filed with ROC;

 

(d)        a declaration of solvency in form No. 4A was filed with the ROC along with the letter of offer;

 

(e)        the letter of offer was despatched immediately after filing with ROC but not later than 21 days from its filing with ROC;

 

(f)        the offer for buy‑back remained open to the members for a period not less than 15 days and not exceeding 30 days from the date of despatch of letter of offer;

 

(g)        the acceptance per shareholder was on proportionate basis where shares offered by shareholders are more than the total number of shares to be bought back;

 

(h)        the company had immediately after the date of closure of the offer opened a special bank account and deposited therein such sum, as would make up the entire sum due and payable as consideration for the buy‑back in terms of the Rules;

 

(i)         the share certificates so bought back were extinguished and physically destroyed in the presence of a CSP within 7 days of the last date of completion of buy‑back;

 

(j)         the company had furnished with the ROC a certificate duly verified by two directors including the Managing Director and a CSP certifying compliance with above mentioned Rules and also specifically rule 10(1) of the said Rules regarding extinguishing of share certificates within 7 days of the extinguishing and destruction of the certificates;

 

(k)        the company has flied with the ROC a return on buy‑back of securities as prescribed in Annexure 'A' of the said Rules within 30 days of completion of the buy‑back‑,

 

(1)        the register on buy‑back of securities has been maintained by the company as prescribed in Annexure 'B' of the said Rules.

 

(viii)      If the Company is a Listed Company in addition to the requirements stated at (i) to (vi) above check whether:

 

(a)        the buy‑back was made as per the SEBI (Buy‑back of Securities) Regulations, 1998;

 

(b)        the company has filed with SEBI and the ROC a return on buy‑back of securities within 30 days of completion of the buy‑back in the prescribed format;

 

(c)        the register on buy‑back of securities has been maintained by the company in the prescribed format.

 

(ix)       the company which has completed buy‑back has not made further issue (including rights issue) of the same kind of shares or other specified securities within 24 months except by way of bonus issues or in the discharge of subsisting obligations such as conversion of warrants, stock option scheme, sweat equity or conversion of preference shares or debentures into equity shares;

 

(x)        prohibition for buy‑back is not attracted in certain circumstances as set out under section 77B.

 

            Paragraph‑21.‑The company has redeemed _____________ preference shares/ debentures during the year after complying with the provisions of the Act.

 

REDEMPTION OF PREFERENCE SHAREWDEBENTURES

 

(a)        Redemption of Preference Shares

Check whether any preference shares have been redeemed; if so check

 

(i)         the provisions contained in Articles of Association have been complied with;

 

(ii)        the conditions set out in section 80 of the Act have been met; and

 

(iii)       Form No. 5 has been filed with the ROC within 30 days from the date of redemption.

 

(b)        Redemption of Debentures

                        Check whether:

 

(i)         the company has created a debenture redemption reserve for the redemption of debentures and credited adequate amount from out of the profits until such debentures are redeemed;

 

(ii)        the company has not utilised the debenture reserve except for the redemption of debentures;

 

(iii)       the company has paid interest and redeemed the debentures in accordance with the terms and conditions of their issue;

 

(iv)       the company has complied with the order, if any, of the Company Law Board with regard to redemption of debentures.

 

Paragraph‑22.‑The company wherever necessary has kept in abeyance rights to dividend, rights shares and bonus shares pending registration of transfer of shares in compliance with the provisions of the Act.

 

RIGHTS TO DIVIDEND, RIGHTS SHARES AND BONUS SHARES HELD IN ABEYANCE

 

Check whether:

 

(i)         rights to dividend, rights shares and bonus shares have been held in abeyance in cases where the instrument of transfer has been delivered to the company and the transfer of' such shares has not been realstered by the company;

 

(ii)        in case instrument of transfer of shares is pending registration with the company, check whether the dividend relating, to such shares has been transferred to a special bank account opened by the company under section 205A unless the company is authorised by the registered shareholder, in writing, to pay such dividend to the transferee specified in the instrument of transfer.

 

Paragraph‑23.‑The company has complied with the provisions of sections 58A and 58AA read with Companies (Acceptance of Deposit) Rules, 1975/the applicable directions issued by the Reserve Bank of India/any other authority in respect of deposits accepted including unsecured loans taken, amounting to Rs _________ raised by the company during theyear and the company has riled the copy of advertisement/ statement in lieu of advertisement/ necessary particulars as required with the Registrar of Companies ___________ on __________ The company has also filed return of deposit with the Registrar of Companies/Reserve Bank of India/other authorities.

 

BORROWINGS BY WAY OF DEPOSITS

 

(a)        Borrowings by Way of Deposits by NBNFCs

Check whether:

 

(i)         the company is not in default in the repayment of any deposit or part thereof and any interest thereupon in accordance with the terms and conditions of such deposit;

 

(ii)        approval of the Board in terms of section 292 (1) has been obtained to invite ‑deposits and draft advertisement approved;

 

(iii)       the advertisement has been issued on the authority and in the name of the Board;

 

(iv)       the advertisement contains the particulars specified in rules 4(2) (a) to (k) of the Companies (Acceptance of Deposits) Rules, 1975. In case deposits were accepted without invitation, check that a statement in lieu of advertisement has been delivered to the ROC before accepting deposits (rule 4A);

 

(v)        a copy of the advertisement duly signed by majority of directors was filed with the ROC, for registration, before publishing the same;

 

(vi)       advertisement has been published in a leading English newspaper and one vernacular newspaper circulating in the State where the registered office is situated within the prescribed time;

 

(vii)      proper scrutiny of the fixed deposit application forms, particularly the name(s), amount, address and other relevant particulars, has been done;

 

(viii)      deposits repayable on demand or on notice or after a period of thirty six months have not been accepted;

 

(ix)       no deposits were accepted for a period of less than six months and more than three years;

 

(x)        deposits have been accepted within the limits prescribed in rule 3(2);

 

(xi)       the rate of interest on deposits is within the prescribed limit;

 

(xii)      the rate of brokerage is within the prescribed limits;

 

(xiii)      the company, deposits/in vests on or before 30th April of each year not less than the prescribed limit of the deposits maturing during the year, in specified securities (rule 3A);

 

(xiv)     proper receipts were issued to the depositors on the acceptance of deposits;

 

(xv)      register of deposits has been maintained with particulars specified in rule 7;

 

(xvi)     return of deposits duly certified by the auditor of the company has been filed with the ROC and Reserve Bank of India on or before 30th June giving the position as on 31st March;

 

(xvii)     payment of interest has been made on time;

 

(xviii)    deposits were repaid on time. In case of repayment of deposits before maturity, the company has complied with the requirements of the Rules in this regard;

 

(xix)     where the company has obtained any extension of time or exemption under section 58A(8), the terms thereof have been complied with;

 

(xx)      in case any order has been made by the Company Law Board under section 58A(9), it has been complied with;

 

(xxi)     the company has complied with applicable directions issued by RBI, if any.

 

(b)        Borrowings by Ways of Deposits by NBFCs

Check whether:

 

(i)         the company having Net Owned Fund of twenty five lakh of rupees and above, has obtained minimum investment grade or other specified credit rating for fixed deposits from any one of the approved credit rating agencies at least once a year,

 

(ii)        the copy of rating as specified above, has been sent to the Reserve Bank of India along with return on prudential norms;

 

(iii)       the company has informed the Reserve Bank of India, about upgrading or down grading of its credit rating to any level from the level previously held by it, within fifteen working days of its being so rated;

 

(iv)       no deposits were accepted or renewed for a period less than twelve months and more than sixty months from the date of acceptance or renewal thereof;

 

(v)        the company has complied with the provisions of Non‑Banking Financial Companies and Miscellaneous Non‑Banking Companies (Advertisement) Rules, 1977;

 

(vi)       the company has delivered to RBI, a statement in lieu of advertisement containing all particulars required to be included in the advertisement pursuant to NBFC and Miscellaneous Non‑Banking Companies (Advertisement) Rules, 1977 and complied with other requirements of para 13 of NBFCs Acceptance of Public Deposits (Reserve Bank) Directions, 1998;

 

(vii)      the rate of brokerage is within the prescribed limits;

 

(viii)      the rate of interest on deposits is within the prescribed limits;

 

(ix)       no deposits were accepted or renewed which are repayable on demand;

 

(x)        register of deposits has been maintained and particulars specified in para 16 of NBFCs Acceptance of Public Deposits (Reserve Bank) Directions, 1998 have been entered therein;

 

(xi)       deposits were repaid in time. In case of repayment of deposits before maturity, the company has complied with the provisions of para 14 of NBFCs Acceptance of Public Deposits (Reserve Bank) Directions, 1998;

 

(xii)      proper receipts were issued to the depositors on the acceptance of deposits;

 

(xiii)      no public deposits were repaid within a period of three months from the date of its acceptance;

 

(xiv)     the company has complied with the provisions of para 9 of NBFCs Acceptance of Public Deposits (Reserve Bank) Directions, 1998 for permitting an existing depositor to renew the deposit before maturity for availing of benefit of higher rate of interest.

 

(xv)      the company has complied with the provisions of para 12 of NBFCs Acceptance of Public Deposits (Reserve Bank) Directions, 1998 regarding particulars to be specified in application form soliciting public deposits;

 

(xvi)     the company has complied with the provisions of para 10 of NBFCs Acceptance of Public Deposits (Reserve Bank) Directions, 1998 for payment of interest on overdue public deposits;

 

(xvii)     if the company is an equipment leasing company or a hire purchase finance company, it has complied with the provisions of para 4(4) (a) & (b) and pard 5 of NBFCs Acceptance of Public Deposits (Reserve Bank) Directions, 1998 for acceptance or renewal of deposits;

 

(xviii)    if the company is loan company or an investment company, it has complied with the provisions of para 4(4) (c), (d) & (e) and para 5 of NBFCs Acceptance of Public Deposits (Reserve Bank) Directions, 1998 for acceptance or renewal of deposits.

 

(c)        Deposits from Small Depositors

 

Where the company has accepted deposits from small depositors as defined under section 58AA and has made any default in repayment of any such deposits or part thereof or interest thereupon check whether:

 

(i)         the company has sent an intimation of default, if any, in repayment of deposit or part thereof or interest thereupon to the Company Law Board within 60 days from the date of default on monthly basis;

 

(ii)        the intimation includes the particulars in respect of names and addresses of each small depositor, the principal sum of deposits due to them and interest accrued thereupon;

 

(iii)       the company has complied with the order of the Company Law Board, if any;

 

(iv)       the company has not accepted further deposits from small depositors unless each small depositor, whose deposit has matured has been paid the amount of deposit and the interest accrued thereupon. This condition shall not apply if deposit is renewed by the small depositor voluntarily or repayment thereof has become impracticable or been stayed by a competent court or authority;

 

(v)        the company has stated in every advertisement and application form inviting deposits from the public issued after the default. the total number of small depositors and amount due to them in respect of which such default had been made;

 

 (vi)      the company has mentioned in the advertisement and application form inviting deposits issued by it after the default the fact of waiver of interest accrued on deposits of the small depositors; if any;

 

(vii)      the company has after default taken a loan for the purpose of working capital from ally bank, whether the company has first utilised the funds so obtained in repayment ofany deposit or any part thereof or any interest thereupon to the small depositors before applying such funds for any other purpose;

 

(viii)      the application form, issued by the company to small depositors for accepting deposits from them, contained a statement that the applicant had been apprised of -

-           every past default

-           the waiver of interest and reasons therefor.

 

Paragraph‑24.‑The amount borrowed by the company from directors, members, public, financial institutions, banks and others during the financial year endingis/are within the borrowing limits of the company and that necessary resolutions as per section 293(1)(d) of the Act have been passed in duly convened annual/extraordinary general meeting.

 

BORROWINGS

 

(a)        In Case of Private Company

Check whether there are any restrictions on the amount of borrowings contained in the Articles of Association of the company. If yes, check whether borrowings are in accordance with the provisions contained in the Articles.

 

(b)        In Case of Public Company

            Check whether:

 

(i)         the Memorandum and Articles contains provisions with respect to the powers of the company to borrow money and to charge the assets of the company;

 

(ii)        the power to issue debentures has been exercised at the meeting of the Board;

 

(iii)       the power to borrow money, otherwise than on debentures, has been exercised at the meeting of the Board;

 

(iv)       the power to borrow money otherwise than on debentures has been delegated to a committee of directors or managing director or manager or any other principal officer of the company or in the case of a branch office principal officer of the branch office, if the delegation was made at the meeting of the Board and the resolution delegating the power specified the total amount outstanding, at any time, up to which the money may be borrowed by the delegate;

 

(v)        the total amounts borrowed (apart from temporary loans obtained from the company's bankers in the ordinary course of business) exceed the aggregate of the paid‑up capital of the company and its free reserves, if so, consent of the members in general meeting has been obtained. Verify the resolution passed by the shareholders and the total amount specified therein upto which moneys may be borrowed by the directors;

 

(vi)       Form No. 23 has been filed with the ROC under section 192(4)(ee)(i).

 

Paragraph‑25.‑The company has made loans and investments, or given guarantees or provided securities to other bodies corporate in compliance with the provisions of the Act and has made necessary entries in the register kept for the purpose.

 

LOANS, INVESTMENTS, GUARANTEES AND SECURITIES

 

(a)        Check whether provisions of section 372A are applicable [refer section 372A(8)]. If provisions of section 372A are applicable, check whether the aggregate of the loans made, guarantees giver., securities provided or Investments made by the company are within the limits prescribed under section 372A.

 

(b)        Check that:

 

(i)         the company has not defaulted in complying with the provisions of section 58A,

 

(ii)        Board resolutions were passed with the consent of all the directors present at the meeting;

 

(iii)       the details regarding the transaction were entered chronologically in the Register maintained in this regard as per the provisions of section 372A(5), within 7 days of the transaction (s); and

 

(iv)       the company has obtained prior approval of the public financial institutions, where any term loan is subsisting if it has defaulted in repayment of loan instalments or payment of interest thereon as per terms and conditions of such loan.

 

(c)        If the aggregate has exceeded the prescribed limits, check whether

 

(i)         Board resolutions were passed unanimously approving the impending transaction subject to members' previous approval at general meeting;

 

(ii)        the company has secured prior approval of the public financial institutions where any term loan is subsisting as required under sub‑section (2) of section 372A;

 

(iii)       general meeting(s) (AGM or EGM) have been held and specific special resolutions have been passed stating the limits, particulars of body(ies) corporate in which the investment is proposed to be made or loan or security or guarantees to be given, the purpose and the specific source of funding etc. ;

 

(iv)       no omnibus special resolution(s) have been passed;

 

(v)        in the case of guarantees given by the Board of directors without the authorisation of special resolution(s) check that :

 

‑          exceptional circumstances existed which prevented the company from obtaining the resolution;

 

‑           the Board passed a resolution authorising the same in accordance with the provisions of section 372A;

 

‑           the Board resolution has been confirmed within 12 months at the earliest general meeting of the company;

 

‑           notice of such general meeting (whether annual or extraordinary) indicated clearly the specific limits, the particulars of body(ies) corporate for which the guarantee was given etc.

 

(d)        in the case of loans, check whether the interest rate at which it was made was not lower than the prevailing bank rate as prescribed under section 49 of the Reserve Bank of India Act, 1934;

 

(e)        the details regarding the transaction(s) were entered chronologically in the register maintained in this regard as per the provisions of section‑372A(5), within 7 days of the transaction(s).

 

Paragraph‑26.‑The company has altered the provisions of the Memorandum with respect to situation of the company's registered office from one state to another during the year under scrutiny after complying with the provisions of the Act.

 

Paragraph‑27.‑The company has altered the provisions of the Memorandum with respect to the objects of the company during the year under scrutiny and complied with provisions of the Act.

 

Paragraph‑28.‑The company has altered the provisions of the Memorandum with respect to name of the company during the year under scrutiny and complied with the provisions of the Act.

 

Paragraph‑29.‑The company has altered the provisions of the Memorandum with respect to share capital of the company during the year under scrutiny and complied with the provisions of the Act.

 

Paragraph‑30.‑The company has altered its Articles of Association after obtaining approval of members in the general meeting held on _____________ and the amendments to the Articles of Association have been duly registered with the Registrar of Companies.

 

ALTERATION IN THE MEMORANDUM OR ARTICLES OF ASSOCIATION

 

(a)        Memorandum of Association

 

(i)         Check whether the provision of the Memorandum was altered with respect to situation of the company's registered office from one State to another during the year. If so, check whether:

 

(a)        the company has passed a special resolution and filed Form No.23 with the ROC;

 

(b)        the Company Law Board confirmed the alteration;

 

(c)        the order of the Company Law Board had been filed with the ROC (both the States) in Form No.21 within three months from the date of the order along with printed copy of the Memorandum duly altered;

 

(d)        the ROCs of both States have issued relevant certificates;

 

(e)        Form No. 18 was filed with both the ROCs within 30 days of the change of the registered office; and

 

(f)        alterations had been incorporated in all the copies of the Memorandum, Articles and other documents.

 

(ii)        Check whether the provisions of the Memorandum with respect to the objects of the company was altered during the year. If so, check whether :

 

(a)        the company has filed with the ROC in Form No. 23 the special resolution passed by the company within one month from the date of such resolution;

 

(b)        the ROC issued certificate registering alterations; and

 

(c)        the alterations had been incorporated in all the copies of the Memorandum.

 

(iii)       Check whether the company changed its name during the year. If so, check whether:

 

(a)        the company has passed a special resolution and filed Form No. 23 with the ROC within 30 days;

 

(b)        fresh certificate of incorporation was obtained from the ROC;

 

(c)        the name has been painted/affixed/printed on the name board, business letters, bill heads, Memorandum and Articles; and

 

(d)        new common seal has been adopted by the Board.

           

(iv)       Check whether the company altered the conditions of its Memorandum as regards share capital in any of the ways mentioned in section 94(1). If so, check whether:

 

(a)        alteration was authorised by the Articles and the general meeting;

 

(b)        alteration had been effected in all copies of Memorandum and Articles etc.; and

 

(c)        Form No. 5 and 23 were filed with the ROC within 30 days.

 

(b)        Articles of Association

Check whether the Articles were altered during the year. If so, check whether :

 

(i)         copy of the special resolution containing the amendments to the Articles of Association along with Form No. 23 have been duly filed with the ROC within 30 days; and

 

(ii)        the alteration had been incorporated in all copies of Articles.

 

Paragraph‑31.‑A list of prosecution initiated against or show cause notices received by the company for alleged offences under the Act and also the fines and penalties or any other punishment imposed on the company in such cases is attached.

 

PROSECUTION OR SHOW CAUSE NOTICES

 

Check whether:

 

(i)         the company has been issued any show cause notice by the ROC for non‑compliance of any of the provisions of the Act; if so, verify the explanations given by the company while assessing enormity of the violations in question;

 

(ii)        the notices of prosecution/show cause have been placed before the Board;

 

(iii)       the company has received any prosecution notice;

 

(iv)       any inspection or investigation has been ordered under the Act and if so, assess the status at the time of issuing the Compliance Certificate;

 

(v)        any fines and penalties or any other punishment was imposed on the company;

 

(vi)       any order has been issued under the Act for compounding of the offences; if so check whether the company has complied with the orders passed by the concerned authorities.

 

Paragraph‑32.‑The company has received Rs __________ as security from its em­ployees during the year under certification and the same has been deposited as per provisions of section 417(1) of the Act.

 

DEPOSIT OF EMPLOYEES SECURITY DEPOSITS

 

Check whether:

 

(i)         any money or security deposited with the company by any employee in pursuance of his contract of' service with the company has been kept or deposited by the company within 15 days from the date of deposit in an account as specified in clauses (a) to (c) of subsection (1) of section 417:

 

(ii)        the company has not utilised any portion of such money or securities except for the purposes agreed to in the contracts of service.

 

Guidance Note on Compliance Certificate       § App. 42 1857

 

Paragraph‑33.‑The company has deposited both employee's and employer's contribution to Provident Fund with prescribed authorities pursuant to section 418 of the Act.

 

DEPOSIT OF CONTRIBUTION TO PROVIDENT FUND

 

Check whether the company has constituted a Provident Fund for its employees or any class of employees. If yes, check that all moneys contributed to such fund (whether by the company or by the employees) or received or accruing by way of interest or otherwise to such fund has been deposited within 15 days from the date of contribution, receipt of accrual, as the case may be, in an account as specified in clause (a) of sub‑section (1) of section 418 or invested in the securities mentioned or referred to in clause (a) to (e) of section 20 of the Indian Trust Act, 1882.

 

CHECK LIST FOR OTHER COMPLIANCES

 

There may be certain matters which have bearing on the compliances under the Companies Act although not directly referred to in the 33 paragraphs of the Form appended to the Companies (Compliance Certificate) Rules, 2001. An illustrative but not exhaustive list of some such matters is given below. It is likely that CSP during the course of scrutiny comes across non‑compliance with regard to such matters. CSP need not qualify non‑compliance of such matters.

 

1.         DIRECTORS/OFFICERS

 

(a)        Appointment of Officers

            Check whether:

 

(a)        the company has appointed qualified secretary in conformity with section 2(45) and 383A read with the Companies (Appointment and Qualifications of Secretary) Rules, 1988;

 

(b)        the company has charged any person with the responsibility of complying with specified provisions as per section 5 and if so whether Form Nos. I AA, I AB and I AC as the case may be under Companies (Central Government) General Rules and Forms, 1956 have been filed with ROC within 30 days;

 

(c)        if receiver or manager of property of the company under section 137 has been appointed, notice thereof has been given to the ROC within 30 days in Form No. 15 of the Companies (Central Government's) General Rules and Forms, 1956.

 

(b)        Vacation of Office of Directors

                        Check whether :

 

(i)         the director has vacated his office on happening of any of the events specified under section 283 (1) of the Act;

 

(ii)        the director has vacated his office on account of any contraventions of sections 314(1) and 314(1B);

 

(iii)       in case of a private company, the director has vacated his office on any other ground as specified in the Articles in addition to those specified in sub‑section (1) of section 283.

 

(c)        Retirement of Directors

                        Check whether:

 

(i)         one third of such directors for the time being as are liable to retire by rotation, or if their number is not three or a multiple of three, then, the number nearest to one third, retire from office at first annual general meeting and at every subsequent annual general meeting;

 

(ii)        the directors retiring by rotation are those who have been longest in office since their last appointment;

 

(iii)       between directors appointed on the same day, the retirement was, in default of and subject to any agreement among themselves, determined by draw of lots;

 

(iv)       the company has filled up such vacancy by appointing the retiring director or some other person.

 

Note :  Unless otherwise specified in the Articles of Association, the aforesaid requirements shall not apply to a private company.

 

(d)        Removal of Directors

                        Check whether :

 

(i)         a special notice as required under sub‑section (2) of section 284 was given to the company to remove a director;

 

(ii)        the company has sent forthwith a copy thereof to the director concerned and the director was provided opportunity to be heard on the resolution at the meeting;

 

(iii)       the representation, if any, made by concerned director has been notified to the members on the request of the director along with the notice of the resolution and if a copy of the representations was not sent because they were received too late or because of company's default, it was read out at the meeting on the request of the director;

 

(iv)       the director who was removed from office was not re‑appointed as a director by the Board of directors.

 

Note :   These provisions are not applicable to a director appointed by Central Government and a director holding office for life on 1.4.1952

 

2.         STATUTORY MEETING/CLASS MEETINGS

 

(a)        Statutory Meeting (in case of a Public Company)

 

Check whether:

 

(i)         the meeting has been held within the period prescribed under section 165(1);

 

(ii)        notice of meeting and statutory report in Form No. 22 duly certified were sent to the members and ROC; and

 

(iii)       other requirements of a general meeting e.g., quorum, notice, preparation and signing of minutes, etc., were complied with.

 

(b)        Meeting of Class of Shareholders

                       

Check whether:

 

(i)         the meeting has been convened after duly complying with the provisions under relevant section and rule 7 of the Companies (Central Government's) General Rules and Forms, 1956 e.g., for reduction of capital, for variation of rights of shareholders as directed by Court;

 

(ii)        the applicable provisions (e.g. those under section 102/106) have been duly complied with;

 

(iii)       subject to directions of the Court, requirements relating to notice, attendance, Chairman, quorum, proxy, proxy register/instruments of proxy and conduct of meeting as well as maintenance of minutes of a general meeting have been complied with.

 

(c)        Meeting of Creditors and Others

                       

Check whether:

 

(i)         the meeting has been convened after duly complying with rule 7 of the Companies (Central Government's) General Rules and Forms, 1956, the terms of agreement or the directions of Court/CLB e.g. meetings convened in sections 391/394 or sections 397/398.

 

(ii)        as directed by the Court, requirements relating to notice, attendance, Chairman, quorum, proxy, proxy register/instruments of proxy and conduct of meeting as well as maintenance of minutes of a general meeting have been complied with.

 

(d)        Passing of Resolutions by Postal Ballot under Section 192A by a Listed Company

 

Check whether :

 

(i)         the company has passed any resolution by resorting to postal ballot;

 

(ii)        the company has passed the resolution only by postal ballot in respect of business as may be declared by the Central Government to be conducted by means of a postal ballot;

 

(iii)       the company had sent a notice to all the shareholders;

 

(a)        by registered post acknowledgment due or any other method as may be prescribed by the Central Government;

 

(b)        along with a draft resolution explaining the reasons therefor and requesting them to send their assent or dissent in writing on a postal ballot within a period of thirty days from the date of posting of the letter;

 

(c)        along with a postage pre‑paid envelope for facilitating the communication of assent or dissent of the shareholder to the resolution within the said period.

 

(iv)       the resolution passed was assented to by the requisite majority;

 

(v)        the ballot papers or declaration of identity of shareholders have been properly main­tained.

 

Notes :

 

(i)         Postal ballot includes voting by Electronic Mode.

 

(ii)        The listed company shall also comply with the other requirements as may be prescribed by the Central Government.

 

(iii)       Provisions will be effective when notified.

 

3.         OBSERVANCE OF SECRETARIAL STANDARDS

 

Check (as and when introduced) whether the company has followed the applicable secretarial standards prescribed by the Institute of Company Secretaries of India constituted under the Company Secretaries Act, 1980 (56 of 1980).

 

4.         SUNDRY ITEMS (General)

 

(a)        Disclosures

                        Check whether the company has made the following disclosures :

 

(i)         the address of its registered office as per section 147;

 

(ii)        the authorlsed share capital in its official publications and if yes, subscribed/ paid‑up share capital as per section 148;

 

(iii)       directors' interest in contract(s) appointing manager or managing director as per section 302.

 

Check whether the company has complied with the requirements in pursuance of disclosures by directors regarding

 

(i)         particulars of directors under section 303:

 

(ii)        particulars of other directorships under section 305;

 

(iii)       particulars of directorship, membership and partnership under section 299;

 

(iv)       particulars of directors' shareholdings under section 308;

 

(v)        particulars of interest or concern in any contract under section 297.

 

(b)        Appointment/Change and Remuneration of Auditors

Check whether :

 

(i)         the appointment and remuneration of auditors are in order with reference to sections 224, 224A, 225, 226 and 228;

 

(ii)        the company has obtained requisite intimation under section 224(1B) before appointment/reappointment of auditors‑,

 

(iii)       the company has intimated appointment/reappointment of auditors under section 224(1).

 

(c)        Holding Company and Subsidiary Company

                        Check whether:

 

(i)         if during the year the company has become a 'holding company' or 'subsidiary company' under section 4 and where the financial year of the subsidiary does not coincide with that of the holding company there should not have been a gap in excess of six months between the financial year of the holding and subsidiary company;

 

(ii)        in such cases the balance sheet of holding company include certain particulars as to its subsidiaries as required under section 212;

 

(iii)       where the holding company was unable to obtain the required information from its subsidiaries check whether a report in writing to that effect was attached to the balance sheet of the holding company;

 

(iv)       any exemption was obtained from the Central Government and if so whether the directions given by the Central Government were complied with.

 

(d)        Conversion of a Public Company (other than Section 43A Company) into a Private Company

 

Check whether:

 

(i)         the company has received the approval of ROC;

 

(ii)        the company has passed a special resolution authorising the conversion and altering the Articles so as to contain the matter specified in section 3( 1 )(iii) and filed the same with the ROC;

 

(iii)       the company has passed a special resolution as required under section 21 read with section 13 (1)(a) and filed the same with the ROC;

 

(iv)       the company has obtained consent of' every creditor to whom the company owes substantial amounts or has issued a public notice in newspapers for conversion of a public company into a private company;

 

(v)        the company has obtained fresh certificate of incorporation from ROC;

 

(vi)       the alteration of name has also been effected in the Memorandum and Articles of Association. common seal, name board and other documents.

 

(e)        Conversion of a Public Company (Section 43A Company) into a Private Company

Check whether:

 

(i)         a public company (section 43A company) has become a private company after the commencement of the Companies (Amendment) Act, 2000 and if so, has it informed/applied ROC that it has become a private company:

 

(ii)        the ROC has made necessary alterations in the certificate of incorporation by substituting, the word 'private limited' for the word 'public limited';

 

(iii)       the company has filed Form No. 23 with the ROC and obtained new certificate of incorporation.

 

(iv)       he private company's Articles contain provisions

 

(a)        restricting the right to transfer its shares;

 

(b)        limiting the number of members to fifty;

 

(c)        prohibiting any invitation to public to subscribe its shares/ debentures; and

 

(d)        prohibiting an invitation or acceptance of deposits from persons other than its members, directors or their relatives.

 

(f)         Continuation of a Section 43A Public Company as a Public Company

 

If a public company (section 43A company) intends to continue as a public company then check whether :

 

(i)         it has altered its Articles by deleting provisions relating to matters specified in clause (iii) of sub‑section (1) of section 3;

 

(ii)        it has altered its Articles for increasing the number of its members to minimum seven;

 

(iii)       it has altered its Articles for increasing the number of directors to at least three directors;

 

(iv)       it has a minimum paid up capital of five lakh rupees or more on or before 12th December 2002 or such higher paid‑up capital as may be prescribed;

 

(v)        it has filed Form No. 23 with the ROC and obtained a fresh certificate of incorporation.

 

(g)        Conversion of a Private Company (which is a Subsidiary of a Public Company) into a Public Company

 

A private company which is a subsidiary of a public company is a public company as per provisions of sub‑clause (c) of clause (iv) of sub‑section (1) of section 3. Therefore, check whether:

 

(i)         it has altered its Articles by deleting provisions relating to matters specified in clause (iii) of sub‑section (1) of section 3;

 

(ii)        it has altered its Articles for increasing the number of its members to minimum seven;

 

(iii)       it has altered its Article for increasing the number of its directors to at least three directors;

 

(iv)       it has altered other regulations in the Articles which are not applicable to a public company;

 

(v)        it has a minimum paid up capital of five lakhs rupees or more on or before 12th December 2002 or such higher paid‑up capital as may be prescribed;

 

(vi)       it has filed Form No. 23 with the ROC and obtained a fresh certificate of incorporation;

 

(vii)      it has filed prospectus/statement in lieu of prospectus with ROC.

 

(h)        Conversion of a Private Company Into a Public Company under Section 44

Check whether:

 

(i)         the company has increased the number of its directors to minimum three;

 

(ii)        the company has increased the number of its members to minimum seven;

 

(iii)       the company has secured shareholders' approval by special resolution for deletion of the Article containing restrictive provisions applicable to a private company [vide section 3(1)(iii)];

 

(iv)       the company has altered other regulations in the Articles which are not applicable to a public company;

 

(v)        the company has filed Form No. 23 with the ROC along with the special resolution and explanatory statement;

 

(vi)       the company has filed prospectus/statement in lieu of prospectus with the ROC;

 

(vii)      the company has received a new certificate of incorporation after deleting the word "private" in its name.

 

(i)         Redemption of Irredeemable Preference Shares under Section 80‑A

 

Check whether the company had issued before the commencement of the Companies (Amendment) Act, 1988 preference shares which were irredeemable or not redeemable before the expiry of ten years, if so :

 

(i)         whether steps had been taken to comply with the requirements of section 80A(1)(a) or 80A(1) (b) as the case may be;

 

(ii)        if the company was not in a position to redeem any such share within the period specified in clause (a) or (b) of sub‑section (1) of section 80A, check whether consent of the Company Law Board had been obtained for issue of further redeemable shares equal to the amounts due (including the dividend thereon) in respect of unredeemed preference shares.

 

(j)         Commencement of New Business stated in 'Other Objects' in the Memorandum in the Case of Public Companies

Check whether:

 

Khyati – 1861

 

 

(p)        Register of Loans under Section 370 (Up to 30th October 1998)

 

Check whether:

 

(i)         register has been maintained showing the following particulars:

 

(a)        the names of all bodies corporate under the same management as the lending company and the name of every firm in which a partner is a body corporate under the same management as the lending company;

 

(b)        the name of the body corporate to which loan has been made;

 

(c)        the amount of the loan;

 

(d)        the date on which the loan has been made;

 

(e)        the date on which guarantee has been given or security has been provided, as the case may be together with the name of the person, body corporate or firm.

 

(ii)        the particulars of every loan, guarantee or security has been entered in the register within three days of the making of such loans or the giving of such guarantee or the provision of such security;

 

(iii)       the register is kept at the registered office of the company;

 

(iv)       the register is kept open for inspection and extracts thereof have been supplied to members when demanded on payment of the requisite fee.

 

Notes :

 

(1)        The above checklist shall apply in case there were loans made prior to 31st October 1998 but subsisting during the period under certification.

 

(2)        If the provisions of section 370 were not applicable to a company, the aforesaid requirements will not apply.

 

(q)        Register of Investments under Section 372 (Up to 30th October 1998)

 

Check Whether:

 

(i)         register has been maintained for entering the following particulars

 

(a)        investments made by it in shares of any other body or bodies corporate (whether in the same group or not);

 

(b)        the name of the body corporate in which the investment has been made;

 

(c)        the date on which the investment has been made;

 

(d)        where the body corporate is in the same group as the investing company, the date on which the body corporate came tinder the same group. and

 

(e)        the names of all bodies corporate in the same group as the investing company;

 

(ii)        the particulars of every investment made have been entered chronologically within 7 days of the making thereof;

 

(iii)       the register is kept at the registered office of the company;

 

(iv)       the register is kept open for inspection and an extracts thereof have been supplied to members when required on payment of requisite fee.

 

Notes :

 

(1)        The above check list shall apply in case there were investments made prior to 31st October 1998 but subsisting during the period under certification.

 

(2)        If the provisions of section 372 were not applicable to a company, no entries need to be made by the company.

 

(r)        General

 

Check whether:

 

(i)         a company has served documents on a member in conformity with the provisions of section 53;

 

(ii)        a public company has paid underwriting commission; if so, check whether it has complied with the provisions contained in section 76 and its Articles of Association,

 

(iii)       the company has complied with the provisions of section 188 in respect of circulation of members' resolutions;

 

(iv)       the company has paid interest out of capital and if so check the payment has been authorised by its Articles or by a special resolution in as much as with the previous sanction of the Central Government.

 

SPECIMEN COMPLIANCE CERTIFICATE

 

Registration No. of the Company ___________________

Nominal Capital: Rs. ____________________

 

To,

The Members

ABC Limited,

163 Back Bay Reclamation

Nariman Point

Mumbai

 

I/We have examined the registers, records, books and papers of ABC Limited (the Company) as required to be maintained under the Companies Act, 1956, (the Act) and the rules made there under and also the provisions contained in the Memorandum and Articles of Association of the Company for the financial year ended on 31st December 2000 (financial year). In my/our opinion and to the best of my/our information and according to the examinations carried out by me/us and explanations furnished to me/ us by the company, its officers and agents, I/we certify that in respect of the aforesaid financial year:

 

1.         The company has kept and maintained all registers as stated in Annexure 'A' to this certificate, as per the provisions of the Act and the rules made thereunder and all entries therein have been duly recorded.

 

2.         The company has duly filed the forms and returns as stated in Annexure 'B' to this certificate, with the Registrar of Companies, Regional Director, Central Government, Company Law Board or other authorities within the time prescribed under the Act and the rules made thereunder.

 

3.         The company being a private limited company has the minimum prescribed paid‑up capital and its maximum number of members during the said financial year was Forty one excluding its present and past employees and the company during the year under scrutiny:

 

(i)         has not invited public to subscribe for its shares or debentures; and

 

(ii)        has not invited or accepted any deposits from persons other than its members, directors or their relatives.

 

OR

 

The company, being a public limited company, comments are not required.

 

4.         The Board of Directors duly met six times respectively on 5th January 2000, 6th April 2000, 15th June 2000, 31st August 2000, 10th October 2000 and 30th December 2000 in respect of which meetings proper notices were given and the proceedings were properly recorded and signed including the circular resolutions passed in the Minutes Book maintained for the purpose.

 

5.         The company closed its Register of Members, and/or Debenture‑holders from 9th June 2000 to 14th June 2000 and necessary compliance of section 154 of the Act has been made.

 

OR

 

The company has not closed/was not required to close its Register of Members or Debenture holders during the financial year.

 

6.         The annual general meeting for the financial year ended on 31st, December 1999 was held on 14th June 2000 after giving due notice to the members of the company and the resolutions passed thereat were duly recorded in Minutes Book maintained for the purpose.

 

7.         One extra‑ordinary general meeting was held during the financial year after giving due notice to the members of the company and the resolutions passed thereat were duly recorded in the Minutes Book maintained for the purpose.

 

OR

 

No extra ordinary general meeting was held during the financial year.

 

8.         The company has advanced a loan of Rs. five lakhs to its directors and/or persons or firms or companies referred in the section 295 of the Act after complying with the provisions of the Act.

 

OR

 

The company has not advanced any loans to its directors or persons or firms or companies referred to under section 295 of the Act.

 

OR

 

The company being a private company, section 295 of the Act is not applicable.

 

9.         The company has duly complied with the provisions of section 297 of the Act in respect of contracts specified in that section.

 

OR

 

The company has not entered into any contracts falling within the purview of section 297 of the Act.

 

10.        The company has made necessary entries in the register maintained under section 301 of the Act.

 

OR

 

The company was not required to make any entries in the register maintained under section 301 of the Act.

 

11.        The company has obtained necessary approvals from the Board of directors, members and previous approval of the Central Government pursuant to section 314 of the Act wherever applicable.

 

OR

 

As there were no instances falling within the purview of section 314 of the Act, the company has not obtained any approvals from the Board of directors, members or Central Government.

 

12.        The Board of directors or duly constituted Committee of Directors has approved the issue of duplicate share certificates.

 

OR

 

The company has not issued any duplicate share certificates during the financial year.

 

13.        The Company has:

 

(i)         delivered all the certificates on allotment of securities and on lodgment thereof for transfer/transmission or any other purpose in accordance with the provisions of the Act;

 

OR

 

There was no allotment/transfer/transmission of securities during the financial year.

 

(ii)        deposited the amount of dividend declared including interim dividend in a separate bank account on 16th June 2000 which is within five days from the date of declaration of such dividend.

 

OR

 

The Company has not deposited any amount in a separate Bank Account as no dividend was declared during the financial year.

 

(iii)       paid/posted warrants for dividends to all the members within a period of 30 (Thirty) days from the date of declaration and that all unclaimed/unpaid dividend has been transferred to Unpaid Dividend Account of the Company with State Bank of India, Mumbai on 18th July, 2000.

 

OR

 

The Company was not required to post warrants to any member of the company as no dividend was declared during the financial year.

 

(iv)       transferred the amounts in unpaid dividend account, application money due for refund, matured deposits, matured debentures and the interest accrued thereon which have remained unclaimed or unpaid for a period of seven years to Investor Education and Protection Fund (applicable when Rules are notified).

 

(v)        duly complied with the requirements of section 217 of the Act.

 

14.        The Board of Directors of the company is duly constituted and the appointment of directors, additional directors, alternate directors and directors to fill casual vacancies have been duly made.

 

OR

 

The Board of directors of the company is duly constituted. There was no appointment of additional directors, alternate directors and directors to fill casual vacancy during the financial year.

 

15.       The appointment of Managing Director/Whole‑time Director/ Manager has been made in compliance with the provisions of section 269 read with Schedule XIII to the Act and approval of the Central Government has been obtained in respect of appointment of Mr. A not being in terms of Schedule XIII.

 

OR

 

The appointment of Managing Director*/Whole‑time Director*/ Manager* (delete which is not applicable) has been made in compliance with the provisions of the Act and approval of Central Government has been obtained.

 

OR

 

The Company being a private company provisions of section 269 of the Act with regard to appointment of Managing Director/ Whole‑time Director/ Manager are not applicable.

 

 

OR

 

The Company has not appointed any Managing Director/Whole‑time Director/Manager during the financial year.

 

16.        The appointment of sole‑selling agents was made in compliance of the provisions of the Act.

 

OR

 

The company has not appointed any sole selling agents during the financial year.

 

17.        The company has obtained all necessary approvals of the Central Government, Company Law Board, Regional Director, Registrar or such other authorities as prescribed under the various provisions of the Act as detailed below:

 

(i)

(ii)

(iii)

(iv)

 

OR

 

The company was not required to obtain any approvals of the Central Government, Company' Law Board, Regional Director, Registrar and/or such authorities prescribed under the various provisions of the Act during the financial year.

 

18.        The directors hive disclosed their interest in other firms/companies to the Board of Directors pursuant to the provisions of the Act and the rules made thereunder.

 

19.        The company has issued ____________ shares/debentures/other securities during the financial year and complied with the provisions of the Act.

 

OR

 

The company has not issued any shares, debentures or other securities during the financial year.

 

20.        The company has bought back 1,00,000 shares during the financial year ending 31st December, 2000 after complying with the provisions of the Act.

 

OR

 

The company has not bought back any shares during the financial year.

 

21.        The company has redeemed ____________ preference shares/debentures during the year after complying with the provisions of the Act.

 

OR

There was no redemption of preference shares or debentures during the financial year.

 

22.        The company wherever necessary has kept in abeyance rights to dividend, rights shares and bonus shares pending registration of transfer of shares in compliance with the provisions of the Act.

 

OR

 

There were no transactions necessitating the company to keep in abeyance the rights to dividend, rights shares and bonus shares pending registration of transfer of shares.

 

23.       The company has complied with the provisions of sections 58A and 58AA read with Companies (Acceptance of Deposit) Rules, 1975/ the applicable directions issued by the Reserve Bank of India/any other authority in respect of deposits accepted including unsecured loans taken, amounting to Rs. 50,000 raised by the company during the year and the company has filed the copy of Advertisement/Statement in lieu of Advertisement/ necessary particulars as required with the Registrar of Companies Maharashtra on 21st August, 2000. The company has also filed return of deposit with the Registrar of Companies /Reserve Bank of India/other authorities.

 

OR

 

The company has not invited/accepted any deposits including any unsecured loans falling within the purview of section 58A during the financial year.

 

24.        The amount borrowed by the company from directors, members, public, financial institutions, banks and others during the financial year ending 31st December, 2000 is/are within the borrowing limits of the company and that necessary resolutions as per section 293(1)(d) of the Act have been passed in duly convened annual/extraordinary general meeting.

 

OR

 

The company, being a private company, the borrowings made during the financial year do not attract provisions of section 293(1)(d) of the Act.

 

OR

 

The company has not made any borrowings during the financial year ended 31st December, 2000.

 

 

25.       The company has made loans and investments, or given guarantees or provided securities to other bodies corporate in compliance with the provisions of the Act and has made necessary entries in the register kept for the purpose.

 

OR

 

The company has not made any loans or advances or given guarantees or provided securities to other bodies corporate and consequently no entries have been made in the register kept for the purpose.

 

26.        The company has altered the provisions of the Memorandum with respect to situation of the company's registered office from one State to another during the year under scrutiny after complying with the provisions of the Act.

 

OR

 

The company has not altered the provisions of the Memorandum with respect to situation of the company's registered office from one State to another during the year under scrutiny.

 

27.        The company has altered the provisions of the Memorandum with respect to the objects of the company during the year under scrutiny and complied with provisions of the Act.

 

OR

 

The company has not altered the provisions of the Memorandum with respect to the objects of the company during the year under scrutiny.

 

28.        The company has altered the provisions of the Memorandum with respect to name of the company during the year under scrutiny and complied with the provisions of the Act.

 

OR

 

The company has not altered the provisions of the Memorandum with respect to name of the company during the year under scrutiny.

 

29.        The company has altered the provisions of the Memorandum with respect to share capital of the company during the year under scrutiny and complied with the provisions of the Act.

 

OR

 

The company has not altered the provisions of the Memorandum with respect to share capital of the company during the year under scrutiny.

 

30.        The company has altered its Articles of Association after obtaining approval of members in the general meeting held on 30th August 2000 and the amendments to the Articles of Association have been duly filed with the Registrar of Companies.

OR

The company has not altered its Articles of Association during the financial year.

 

31.        A list of prosecution initiated against or show cause notices received by the company for aileged offences under the Act and also the fines and penalties or any other punishment imposed on the company in such cases is attached ‑ (Appendix‑1).

 

OR

 

There was/were no prosecution initiated against or show cause notices received by the company and no fines or penalties or any other punishment was imposed on the company during the financial year, for offences under the Act.

 

32.       The company has received Rs. 25,000 as Security from its employees during the year under certification and the same has been deposited as per provisions of section 417(1) of the Act.

 

OR

           

The company has not received any money as security from its employees during the financial year.

 

33.       The company has deposited both employee's and employer's contribution to Provident Fund with prescribed authorities pursuant to section 418 of the Act.

OR

The Company has not deducted any contribution towards Provident Fund during the financial year.

 

Place :  _________                                                                  Signature : _______________

Date :   _________                              Name of the Company Secretary :  _______________

C.P. No.  : _______________

 

 

ANNEXURE A

 

Registers as maintained by the Company

 

Statutory Registers

 

1.         ______________ u/s ______________

2.         ______________ u/s ______________

3.         ______________ u/s ______________

 

Other Registers

 

1.         ______________

2.         ______________

3.         ______________

 

Note : The company has not maintained the following registers. as it was informed that there were no entries/transactions to be recorded therein

 

1.         ______________ u/s ______________

2.         ______________ u/s ______________

3.         ______________ u/s ______________

 

ANNEXURE B

 

Forms and Returns as filed by the Company with Registrar of Companies, Regional Director, Central Government or other authorities during the financial year ending 31st December 2000.

 

S. No.

Form No./ Return

Filed under section

For

Date of filing

Whether filed within prescribed time Yes/No

If delay in filing whether requisite additional fee paid Yes/No

1.

 

 

 

 

 

 

2.

 

 

 

 

 

 

3.

 

 

 

 

 

 

                                               

Note :  Forms/Returns mentioned as at Sr. No ____________ were sent for filing through Ordinary Post/Under Certificate of Posting/Registered Post/Courier alongwith requisite fee by Cheque/Demand Draft/Money Order __________ in respect of which receipt from office of the Registrar of Compa­nies is awaited.

 

 

APPENDIX‑A

 

FORMS, RETURNS & DOCUMENTS TO BE FILED WITH THE REGISTRAR OF

COMPANIES/REGIONAL DIRECTOR/CENTRAL GOVERNMENT/COMPANY LAW BOARD

 

 

 

NO

Section

Rule

Master

Form no

 

1.

33(2)

-

Declaration of compliance with the requirement of the Act at the time of application for new registration of a company.

1

2.

20/21/22

4A

Application for name availability for registration of a company or for change of name of an existing com­pany or rectification of name of an existing company.

1A

3.

5(g)

4BB

Particulars of person/directors charged with the specific responsibility.

1AA

4.

5(f)

4BB

Consent of the person charged with the responsibility of compliance with the provisions of the Act. This Form No. 1 AB should be filed with the ROC as an­nexure to Form No. 1AA.

1AB

5.

5(g)

4BB

Revocation or withdrawal of the consent stated in Form No. 1AB.

1AC

6.

17A

4BBA

Application for the confirmation by Regional Director for change of registered office of the company within a State from the jurisdiction of one ROC to the jurisdiction to another ROC.

1AD

7.

31(1)

-

Application to the Central Government for conversion of public company to a private company (Cen­tral Government has delegated the said power to the ROC).

-

8.

75(1)

5

Particulars of allotment of shares, for consideration in cash or for consideration other than cash. Also the particulars of allotment of bonus shares have to be furnished in this Form.

2

9.

56(3)

4CC

Every form of application for shares or debentures vide public issue must be accompanied by an abridged prospectus.

2A

10.

58A(II),109A

4CCC& 5D

Nomination Form

2B

11.

75(2)

-

Particulars of contracts relating to shares allotted for consideration other than cash.

3

12.

76(1)

 

Commission payable in respect of shares/ debentures.

4

13.

77A(6)

5C

Declaration of Solvency.

4A

14.

77A(10)

5C

Return on buy‑back of Securities.

4C

15.

95/97,94A(2)/81(4)

-

Notice of consolidation, division, etc. and increase in authorised capital or number of shares.

5

16.

108(1A)

5A

Share transfer form.

7B

17.

108(1A)

5A(2A)

Counter receipt and transfer form.

7BB

18.

108(1D)

5A(4)

Extension of time for delays covered by sub‑sections (1A), (1B) and (1C) of section 108. Central Government has delegated the powers to the ROC. This application can be made to the ROC of the State where the registered office of the company is situated or to the ROC of the State where the transferee ordi­narily resides.

7C

19.

108A

5B

Application to the Central Government for acquisition of shares

7D

20.

108B

5B

Intimation to the Central Government about the proposal to transfer the shares.

7E

21.

108C

5B

Application to the Central Government for transfer of shares of foreign companies.

7E

22.

125/127/130/135

6

Common form for furnishing details of creation of charge and modification of charge as well. This form should be accompanied by Form No. 13 also.

8

23.

128/129

-

Particulars of a series, of debentures

10

24.

130/135/137/138

-

Particulars of creation/modification/satisfaction of charge. This form has to be filed along with either Form No. 8/10/17.

13

25.

137(1)

-

Particulars of appointment of receiver or manager of the property.

15

26.

137(2)

-

Particulars of receiver or manager appointed under section 137(1) ceasing to act as such.

16

27.

138

-

Particulars of complete satisfaction of charge. This form should be accompanied by Form No. 13 also.

17

28.

146

-

Particulars of situation/change in situation of the registered office of the company and the name of the police station nearest thereto.

18

29.

149(1)(d)

-

Declaration about compliance with the provisions of    Clauses (a), (b) and (c) of section 149(1) by a public company which has issued a prospectus. It is re­quired to obtain the certificate of commencement of business.

19

30.

149(2)(b)

-

Declaration about compliance with the provisions of clause (b) of section 149(2) by a public company which has filed a statement in lieu of prospectus and is required to obtain the certificate of commencement of business.

20

31.

149(2A)(ii)

-

Declaration about compliance with the provisions of clause (1) (having passed special resolution) or as the case may be, sub‑section (2B) of section 149.

20A

32.

17(1)/79/81(2)/81(4)/94A(2)/102(1)

/107(3)/111(5)/111A/113/141/186/391(2)/394 (1)

-

Notice of order of Court/Company Law Board

21

33.

157(2)

-

Notice of situation of the office where foreign register of members or debenture holders opened and any change in the situation of such office or its dis­continuance.

-

34.

160

-

Annual return to be filed by a company not having share capital.

21A

35.

165

-

Statutory report to be filed by a public company.

22

36.

171(2)

-

A general meeting can be convened by a public company by giving notice of a period less than 21 days by complying with the provisions of section 171(2).

22A

37.

192

-

Registration of special resolutions and agreements.

23

38.

209(1) Proviso

-

Notice of address of keeping the books and accounts.

23AA

39.

219(1)(b)(iv)

7A

Statement containing salient features of annual financial statements to be attached to the documents to be filed under section 220.

23AB

40.

224(1A)

-

Notice by the auditor about acceptance or refusal of appointment as auditor.

23B

41.

233B(2)

-

Application to the Central Government for approval of appointment of Cost Auditor made by the Board of directors of the company.

23C

42.

259

-

Application to the Central Government to increase the number of directors beyond 12 in number by a public company or its subsidiary.

24

43.

297(1) Proviso

-

Application to the Central Government to enter into contract where applicant company's paid up capital exceeds Rs. 1 crore.

24A

44.

299

-

Notice by Interested director(s) to be filed with the company every year giving the names of the compa­nies and firms in which he is interested and, nature of such interest.

24AA

45.

314(1B)

-

Application to the Central Government to hold the office or place of profit.

24B

46.

198(4),269,309(3),311,387,388

-

Application to Central Government by a public company or its subsidiary for appointment, re­-appointment and remuneration payable to managerial personnel.

25A

47.

268

-

Application to the Central Government by a public company or its subsidiary for the amendment of provisions relating to appointment re‑appointment of managing or whole‑time director (not manager) or a director not required to retire by rotation.

25B

48.

269(2) & Sch. XIII

10A(2)

Intimation about appointment of managing or whole time director or manager having complied with the provisions Parts I and II of Schedule XIII. This form has to be certified by either auditor or company sec­retary or company secretary in whole‑time practice.

25C

49.

310,311& 388

-

Application to the Central Government by a public company or its subsidiary for increase in the remu­neration of managing or whole‑time director or manager.

26

50.

264(2)/266(1)(a)/266(1)(b)(iii)

-

Intimation to be filed by a director of a public company or its subsidiary about his consent to act as director and to take qualification shares.

29

51.

303(2)

-

Appointment of director, managing director, manager and secretary and changes among them (to be filed in duplicate).

32

52.

370

-

Application to the Central Government by a public company or its subsidiary for approval to advance loans in excess of the specified limits.

34AA

53.

372

-

Application to the Central Government by a public company or its subsidiary for approval to invest in shares of other company/companies in excess of the specified limits.

34B

54.

395(1)

12(2)

Notice to dissenting share‑holders of the transferor company by the transferee company.

35

55.

395(4A)(a)(1)

12

Information in relation to any offer of a scheme or contract involving transfer of shares or any class of shares in the investors company to the transferee company.

35A

56.

565/566/567

-

Application by a joint stock company for registration as a limited/Unlimited company.

37

57.

565/568

-

Application by an existing company (not being a joint stock company) for registration as a lim­ited/unlimited company. A list of names, addresses and occupations of directors and manager, if any shall also be submitted in Form No. 42 along with Form No. 38.

38/42

58.

567(a)

-

List of members of an existing company to be registered under Part IX of the Act.

39

59.

567©

-

Details of shareholding etc. of an existing company intending to be registered as a limited company.

40

60.

565(1) Proviso (v) & (vii)(a)

-

Copy of resolution assenting to registration of an existing company with limited liability.

41

61.

568(a)

-

List of names, addresses and occupations of directors and, manager, if any, of an existing company, not being a joint stock company. This form should be furnished along with Form No.38.

42

62.

592

-

Submission of prescribed particulars by a foreign company establishing place of business or branch office in India within 30 days.

44

63.

593(a)/(b)/(c)

17,18

Return to be filed by next 1st  January after a foreign company makes alterations in its Memorandum or Articles of Association, charter or statute, address of registered office, directors, secretary.

49

64.

593(d)/(c)

17,18

A foreign company should file within 30 days the details of alterations in the situation of principal place of business in India, names and addresses of persons authorised to accept or service documents on behalf of the company.

52

65.

594(3)

18A

A foreign company to file a declaration of place of business in India within nine months from the date of closure of the financial year.

52

66.

597(3)

-

A foreign company to file a declaration immediately on ceasing to have a place of business in India.

52

67.

600/125

-

Particulars of charge created by a foreign company on property in India to be furnished within 30 days of creation. If the charge is created outside India, period of 30 days to be counted from the date of receipt of instrument or its copy in India.

55

68.

600/127

-

Particulars of charge subject to which property is acquired by a foreign company to be furnished within 30 days.

56

69.

600/128 Proviso

-

Particulars of each issue in a series of debentures floated by a foreign company to be furnished within 30 days of execution of debenture trust deed.

57

70.

600/128/129

-

Particulars of entire series of debentures floated by a foreign company to be furnished within 30 days of execution of debenture trust deed.

58

71.

600/135

-

Particulars of modification on charge by a foreign company to be furnished within 30 days.

59

72.

600/138

-

Particulars of satisfaction of charge by a foreign company to be furnished within 30 days.

60

 

UNDER OTHER REGULATIONS

 

S.No.

Section

Particulars

Relevant provision

73.

44(1)(b)

Statement in lieu of prospectus to be filed with the ROC by a private company on becoming a public company within 30 days.

Schedule IV of the Act.

74.

44(2)(a) & 56

Prospectus to be filed with the ROC.

Schedule II of the Act.

75.

58A

Return of deposit to be filed with the ROC by30th June every year.

Form I of the Companies (Acceptan- ce of Deposits) Rules, 1975

76.

58A

Statement in lieu of advertisement, to be delivered to ROC for registration where a company intends to accept deposits without inviting or allowing or causing any other person to invite such deposit.

Rule 4A of the Companies (Ac­ceptance of Deposits) Rules 1975.

77.

70(1)

Statement in lieu of prospectus to be filed with the ROC by a company which has not issued a prospectus or which has issued the prospectus but has not allotted shares based thereon.

Schedule III of the Act.

78.

77A

Return on buy‑back of securities.

Annexure‑A of the Private Limited Comp- any and Unlisted Public Limited‑Comp-  any(Buyback of Secu­rities) Rules, 1999.

79.

103(1)

Certified copy of court's order for reduction of capital to be filed.

Form No.31 of the Companies (Court) Rules, 1959.

80.

159(1)

Annual return to be filed with the Registrar by a company having a share capital within 60 days of the annual general meeting.

Part II of Schedule V of the Act.

 

81.

187C(4)

Declaration of beneficial interest in shares received from the concerned parties in Forms I and II to be filed with the Registrar along with Form III.

Form III under the Companies (Decla­ ration of Beneficial Interest in Shares) Rules, 1975.

82.

205B

Form of indemnity Bond to be furnished to the Registrar

Form III, ibid.

83.

383A(1) proviso

Compliance Certificate

Form appended to the Companies (Compliance Cer­tificate) Rules, 2001.

84.

600/159

Annual return to be filed by a foreign company.

Form II of Sched­ule V of the Act, subject to the ap­plication of section 159 to Foreign Companies Rules1975.

 

 

PARTICULARS TO BE FILED WITH THE REGISTRAR/REGIONAL DIRECTOR /CENTRAL GOVERNMENT/ COMPANY LAW BOARD FOR WHICH NO FORMS ARE PRESCRIBED

 

S. No.

Section

Matter

85.

25

Application to the Central Government to grant licence not to use the word 'Limited' or the words 'Private Limited" as part of name.

86.

31(2A)

On conversion of a public company into a private company, a printed copy of altered Articles of Association has to be filed with Registrar within one month of receipt of Central Government's ap­proval (i.e. Regional Director's approval).

87.

43A(2A)

For re‑conversion of a deemed public company into a private com­pany, an intimation that it has become a private company is required to be made to the ROC.

88.

58AA

Intimation of defaults in repayment of any deposits accepted from small depositors to Company Law Board.

89.

157(2)

Notice within 30 days to the ROC about the situation where the foreign register is kept or any change in this behalf.

90.

166(1) Second proviso

Application to the ROC for extension of time for holding of annual general meeting, other than the first one.

91.

220(1)

Three copies of annual accounts to be filed with the ROC within 30 days of the annual general meeting.

92.

220(2)

If annual general meeting is not held or is adjourned without adopt­ing the annual accounts or is not adopted by the annual general meeting before which the annual accounts were laid, a statement of that fact and of the reasons for not adopting the annual accounts should be annexed to the copies of the annual reports to be filed with the ROC.

93.

605(1)

Certified copy of prospectus isgued by a foreign company to be filed with the ROC before issue, circulation and distribution in India for subscription of shares in or debentures of that company.

 

APPENDIX‑B

 

MATTERS REQUIRING APPROVAL OF DIRECTORS AS DERIVED FROM POWERS OF THE BOARD OF DIRECTORS

 

Powers Exercisable only at Meeting of the Board

 

S. No.

Section

Remarks

1.

292(1)(a)

To make calls on shareholders.

2.

292(1)(b) & (c)

To issue debentures and borrow moneys otherwise than issue of debentures.

3.

292(1)(d)and (c)

To invest the company's funds and make loans.

4.

292(1), (3) & 4 Proviso (2)

To delegate the power to borrow (otherwise than by issue of deben­tures) and to invest and make loans.

5.

262

To fill‑in the casual vacancies on the Board.

6.

316,386

To appoint as managing director or manager a person who is managing director or manager of another company subject to the condi­tions that the proposed resolution is specified in the notice conven­ing the Board meeting where the resolution is passed unanimously.

7.

297

To give consent to contracts of a company with any director or his relative, firm, private company etc.

8.

372A

To make loans, give guarantee or provide securities to and to make investment in the securities of any other body corporate, a unani­mous resolution is to be passed.

9.

293A(2) Proviso

To make donation to political parties.

10.

299(1)

To make disclosure of interest by a director.

11.

299(3)(c)

To receive notice of disclosure of director's interest.

12.

308(2)

To receive notice of disclosure of directors' shareholdings.

13.

488

To make declaration of solvency where it is proposed to wind up the company voluntarily.

 

Powers Exercisable (in case of Public Company) only with the Consent of the Company in General Meeting

 

14.

293(1)(a)

To sell, lease or otherwise dispose of the whole or part of the under­ taking.

15.

293(1)(b)

To remit debt due by a director.

16.

293(1)(c)

To invest compensation amounts received on compulsory acquisi­tion of any of its properties.

17.

293(1)(d)

To borrow in excess of paid‑up capital and free reserves of the company.

18.

293(1)(e)

To contribute to charities.

19.

294(2)

To appoint sole selling agents.

20.

314

To appoint persons holding office or place of profit drawing remu­neration in excess of prescribed amount.

21.

269, 316, 386 and Schedule XIII

To appoint managerial personnel.

 

Other Powers

 

22.

291

To exercise all the powers that the company is authorised to exercise subject to the provisions of the Act, Memorandum and Articles and resolutions passed at General Meetings of the Company.

 

APPENDIX‑C

 

MATTERS REQUIRING APPROVALS OF SHAREHOLDERS

 

By Ordinary Resolution

 

S. No.

Section

Remarks

1.

22(1)(ii)(a)

To rectify company's name with previous approval of Central Gov­ernment.

2.

61

To vary terms of contract referred to in prospectus or in statement in lieu of prospectus.

3.

79(2)

To issue shares at a discount subject to sanction of' Company Law Board.

4.

94(2)

To alter company's share capital, if authorised by Articles.

5.

98

To increase the nominal amount of capital by an unlimited company.

6.

121

To re‑issue redeemed debentures.

7.

165

To adopt statutory report.

8.

210

To adopt balance sheet and the reports of the Board of directors and auditors at an annual general meeting.

9.

-

To declare dividends (see Article 85 of Table A).

10.

214(1)

To authorise by a holding company its representative to inspect books of accounts of its subsidiary.

11.

224(1)

To appoint auditors and fix their remuneration.

12.

224(5) Proviso (a)

To remove an auditor and appoint in his place any other person nominated by any member.

13.

224(5) Proviso (b)

To appoint first auditor and fix remuneration.

14.

224(6)

To fill casual vacancy in the office of an auditor caused by resigna­tion.

15.

225

To appoint as auditor a person other than a retiring auditor, or pro­viding expressly that retiring auditor shall not be re‑appointed.

16.

255(1)

To appoint first directors who are liable to retire by rotation.

17.

256(3)

To fill vacancy created by retirement of a director at an annual gen­eral meeting.

18.

257(1)

To appoint a person other than retiring director to office of director or regularise appointment of additional director or director appointed in casual vacancy.

19.

258

To increase or reduce number of directors of company within the limits fixed by its Articles of Association.

20.

269

To appoint managing/whole‑time director or manager.

21.

284(1)

To remove a director before expiry of his term of office and appoint a director in his place.

22.

293(1)

To five consent to Board of directors:

(a) to sell, lease or otherwise dispose of the whole or substan­tially the whole of undertaking of company [clause (a)];

(b) to remit or give time for payment of any debt due by a director (clause (b));

(c) to invest otherwise than in trust securities amount of com­pensation received by company in respect of compulsory acquisition of its properties [clause (c)] ‑.

(d) to borrow moneys exceeding the aggregate of paid‑up capital and free reserves of company [clause (d)]; and

(e) to contribute to charitable and other funds exceeding Rs.50,000 or 5 per cent of company's average net profits during preceding three financial years [clause (e)].

 

[Appendix 43‑50 Reserserved]