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Companies often issue Compulsorily Convertible Debentures (CCDs) and Optionally Convertible Debentures (OCDs) as a means of raising capital while deferring equity dilution.
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One of the most neglected compliances in small private limited companies is the maintenance of Board Meeting Minutes.
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Steps for issue of shares through Private Placement offer.
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Sr | Compliance | Section / Rule | Timeline | Purpose | Penalty |
1 | First Board Meeting | Section 173 | Within 30 days of incorporation | Appointment of first auditor, disclosure by directors, opening of Bank account | ₹25,000 on defaulting officer |
2 | Appointment of First Auditor | Section 139(6) | Within 30 days of incorporation | Appointment of statutory auditor | ₹25,000 – ₹5,00,000 |
3 | Issue Share Certificates | Section 56 | Within 2 months of incorporation/allotment | Evidence of share ownership | ₹25,000 – ₹5,00,000 |
4 | Commencement of Business (INC-20A) | Section 10A | Within 180 days of incorporation | Declaration for commencement of business | ₹50,000 (company) + ₹1,000 per day (officer) |
5 | Appointment / Resignation of Director (DIR-12) | Section 170 | Within 30 days of change | Update directors with ROC | Additional fees + penalty |
6 | Change in Registered Office | Section 12 | Within 30 days of change | Inform ROC about new address | ₹1,000 per day (max ₹1 lakh) |
7 | Increase in Authorized Capital (SH-7) | Section 61 | Within 30 days of resolution | Modify capital structure | Additional ROC fee |
8 | Allotment of Shares (PAS-3) | Section 39 | Within 30 days of allotment | Filing return of allotment | Additional fees |
Sr | Compliance | Section / Rule | Due Date | Purpose | Penalty |
1 | Disclosure of Interest (MBP-1) | Section 184 | First BM of FY and first BM post appointment during the year | Directors disclose interest | ₹1,00,000 |
2 | Declaration of Non-Disqualification (DIR-8) | Section 164 | First BM of FY and first BM post appointment during the year | Director declaration | ₹50,000 – ₹5,00,000 |
3 | Minimum Board Meetings | Section 173 | Minimum 4 per year | Corporate governance | ₹25,000 |
4 | Notice of AGM | Section 101 | 21 clear days before AGM | Inform shareholders | Penalty under Section 450 |
5 | Hold AGM | Section 96 | Within 6 months of FY end | Approve accounts etc. | Up to ₹1,00,000 + ₹5,000/day |
6 | Filing Financial Statements (AOC-4) | Section 137 | Within 30 days of AGM | Submit financial statements | ₹100 per day |
7 | Filing Annual Return (MGT-7 / MGT-7A) | Section 92 | Within 60 days of AGM | Return of company details | ₹100 per day |
8 | DIR-3 KYC | Rule 12A of Companies (Appointment and Qualification of Directors) Rules | Before 30 September every year | KYC for directors | ₹5,000 |
9 | DPT-3 | Deposits Rules | On or before 30 June every year | Return of loans / deposits | Penalties under Section 76A |
Sr | Compliance | Section | Due Date | Purpose | Penalty |
1 | MSME-1 | Section 405 | Before 30 April & 31 October every year | Outstanding payments to MSME vendors | ₹25,000 + ₹1,000/day |
2 | PAS-6 (if applicable for demat shares) | Rule 9A | Before 30 April & 31 October every year | Reconciliation of share capital | ₹10,000 + ₹1,000/day |
Sr | Compliance | Section | Requirement |
1 | Maintain Statutory Registers | Section 88 | Register of Members, Directors, Charges |
2 | Maintain Minutes | Section 118 | Minutes of Board & General Meetings to be prepared within 30 days of meeting |
3 | Auditor Rotation (if applicable) | Section 139 | Every five years or as per applicability |
4 | Filing charge creation/modification (CHG-1) | Section 77 | Within 30 days |
Month | Compliance |
April | DIR-8, MBP-1 in first Board Meeting |
June | DPT-3 filing |
April to September | DIR-3 KYC |
September | AGM |
October | AOC-4 filing |
November | MGT-7 / MGT-7A filing |
April & October | MSME-1 |