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12 December
2024
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Understanding Section 92 of the Companies Act, 2013

The Companies Act, 2013 is a significant piece of legislation governing corporate entities in India. Among its various sections, Section 92 plays a pivotal role in ensuring transparency and accountability in the corporate world. This section deals with the filing and maintenance of the Annual Return by companies.

Introduction to Section 92 of the Companies Act, 2013
Section 92 of the Companies Act, 2013 mandates every company to file an Annual Return with the Registrar of Companies (RoC). The primary purpose of this requirement is to provide a comprehensive snapshot of the company’s financial and operational health over the financial year. It ensures transparency and enables regulatory authorities to monitor compliance with corporate laws.

Definition of Annual Return
An Annual Return is a detailed document that provides information about a company's:

  • Shareholders and directors.
  • Registered office address.
  • Capital structure.
  • Indebtedness.
  • Compliance with various regulations during the financial year.

This document is a critical source of information for stakeholders, including investors, regulators, and the public.

Applicability of Section 92
Companies Required to File Annual Returns Under Section 92, the following types of companies must file an Annual Return:

  1. Private Limited Companies
  2. Public Limited Companies
  3. One-Person Companies (OPCs)
  4. Foreign Companies with a Registered Office in India

Exemptions from Filing Annual Returns
Certain companies are exempt from filing an Annual Return under specific conditions:

  • Government companies with appropriate notifications.
  • Startups and newly incorporated companies may enjoy certain relaxations.

Key Provisions Under Section 92
Details Included in the Annual Return
An Annual Return under Section 92 must include the following details:

  • Registered office and principal business activities.
  • Information about directors, managers, and company secretaries.
  • Shareholding patterns and changes during the year.
  • Details of indebtedness.
  • Compliance with rules and regulations.

Certification Requirements
For companies with a turnover exceeding ₹50 crores or a paid-up share capital exceeding ₹10 crores, the Annual Return must be certified by a practicing Company Secretary.

Time Limit for Filing
The Annual Return must be filed within 60 days from the conclusion of the Annual General Meeting (AGM). For companies not required to hold an AGM, the filing is due 60 days from the financial year’s end.

Procedure for Filing the Annual Return
Filing Through MCA Portal

  1. Visit the Ministry of Corporate Affairs (MCA) portal.
  2. Log in with authorized credentials.
  3. Select the appropriate e-Form (e.g., MGT-7 for Annual Return).
  4. Fill in the required details, upload documents, and submit.

Fees and Penalties

  • The filing fee depends on the company’s authorized share capital.
  • Late filing attracts penalties, which may escalate for prolonged delays.

Compliance and Non-Compliance: Legal Implications
Penalties for Non-Filing
Failure to file the Annual Return on time may lead to:

  • Monetary fines on the company and its officers.
  • Disqualification of directors under Section 164.

Impact on the Company’s Reputation
Non-compliance damages the company’s credibility, affecting investor confidence and potential business opportunities.

Role of Company Secretaries in Section 92 Compliance
Company Secretaries (CS) play a vital role in ensuring compliance with Section 92. They:

  • Prepare and verify the Annual Return.
  • Certify the return for eligible companies.
  • Liaise with the RoC for seamless filing.

Amendments and Updates to Section 92
Recent amendments to Section 92 focus on:

Since its launch, the SISFS has:

  • Simplifying compliance for small companies.
  • Digitalization of the filing process.
  • Enhanced penalty provisions to enforce stricter compliance.

FAQs on Section 92

1. What is the purpose of an Annual Return?
The Annual Return provides regulators and stakeholders with a transparent view of a company’s operations and compliance during the financial year.

2. Who certifies the Annual Return?
For larger companies, a practicing Company Secretary certifies the Annual Return. Smaller companies may not require certification.

3. Are there penalties for late filing of the Annual Return?
Yes, penalties include monetary fines and possible legal consequences for company officers.

4. What are the latest amendments under Section 92?
Recent amendments aim to streamline the filing process and impose stricter penalties for non-compliance.

5. How can a company rectify errors in the filed Annual Return?
Companies can file a revised return or contact the RoC for rectification, subject to specific conditions.

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