Take care of these issues failing which you may fail on ensuring to be compliant this year for conducting the Annual General Meeting.
Section 136 – Circulation of Financial statements
• Financial statements, auditor’s report and every other document required by law to be annexed or attached to the financial statements,
• shall be sent to every member, to every trustee for the debenture-holder, and to all persons other than such member or trustee, being the person so entitled, not less than twenty-one days before the date of the meeting
Ensure that the last date for holding the board meeting to approve accounts does not go beyond September 8, 2014.
Section 160 – Appointment of directors other than retiring directors
• A person who is not a retiring director shall by himself or through any member, not less than fourteen days before the meeting, give a notice to propose him as a candidate for that office, along with the deposit of one lakh rupees
• Such amount shall be refunded after the appointment
Any director being appointed or re-appointed the company will have to receive a deposit of Rs.1 lakh per appointee; ensure to encash the cheque and return the amount. Amount can be deposited by the director himself or by the shareholder. In case of FIRC the remittance to state “deposit for appointment of director”
Section 180 - Renewal of limits of borrowing
• The resolution passed under section 293 of the Companies Act, 1956 prior to 12.09.2013 with reference to borrowings or creation of security on assets of the company will be valid for a period of one year i.e. up to 11.09.2014
Section 149 - Resident Director
• Every company shall have at least one resident director stayed in India for 182 days in the preceding financial year. The circular states previous calendar year, to be taken into account for compliance with these provisions will be April to December 31). Therefore, on a proportionate basis, the number of days for which the director(s) would need to be resident in India during Calendar year 2014, shall not exceed 136 days.
The date of appointment was April 1, 2014, but the last date for appointing the resident director as per this circular was August 18, 2014
Section 96(2) - Appointment of Managing Director (MD) / Whole Time Director (WTD)
• MD and WTD of private companies to be re-appointed by the members for a term of 5 years from the date of general meeting or with effect from April 1, 2014
Section 138 - Appointment of internal auditors
• The Company falling under the criteria mentioned under rule 13 shall be required to appoint an internal auditor or a firm of internal auditors, turnover of more than Rs. 200 crore in PY Appoint an internal auditor immediately he has to be professional and can be a foreigner
Section 135 - Provision for CSR spending
• The Companies to create provision for CSR spending in the financial statement ending March 31, 2014
Start spending on CSR after getting members’ approval in the forthcoming AGM as CSR may appear to be a conferred right but it is a permissible right
Pre AGM board meeting
• The Companies to hold pre-AGM board meeting at least 21 days before the date of AGM –September 8, 2014
Section 146 - Auditors to attend the AGM
• All notices of, and other communications relating to, any general meeting shall be forwarded to the auditor of the company, and the auditor shall, unless otherwise exempted by the company, attend either by himself or through his authorised representative, who shall also be qualified to be an auditor
Auditors your presence in an AGM is mandatory, do not skip the AGM
Section 102 - Explanatory statement
• All companies including private companies to give explanatory statement for all the special business
Section 117(2) - Penalty for not filing form MGT 14
• If a company fails to file the resolution or the agreement under sub-section (1) before the expiry of the period specified under section 403 with additional fee, the company shall be punishable with fine which shall not be less than five lakh rupees but which may extend to twenty-five lakh rupees and every officer of the company who is in default, including liquidator of the company, if any, shall be punishable with fine which shall not be less than one lakh rupees but which may extend to five lakh rupees.
Look out for any item for which you have not filed this form, if you fail to file the form with 9 months of the due date, the minimum penalty is Rs. 5 lakhs
Professionals - Penalty for wrong certification of MGT 14 is section 448 read with 447 & 449
What if I do not comply? Please refer to the penal provisions in the Companies Act, 2013
Disclaimer – Not an expert opinion but personal interpretation & views expressed by the author. Views will differ between professionals
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