Insights to MGT - 7 (Annual Return Form) and Provisions of Companies Act, 2013.
As per Companies Act 2013, every company is required to get its Annual filing done within due dates.
Following forms are required to be filed for Annual filing:
In this article we will discuss about Form MGT 7 which is required to be filed for Annual Return.
Annual Return is a significant document for the stakeholders of a company as it provides in a nutshell, very comprehensive information about various aspects of a company.
As per Section 92(1) of Companies Act, 2013 and Rule 11(1) of the Companies (Management and Administration) Rules, 2014:-
Every company shall prepare its annual return in Form No. MGT.7. and file with the Registrar within 60 days from the date on which Annual General Meeting (after AGM) is actually held, or
Within 60 days from the date from the due date of AGM (see section 96).
Contents of the Form
An Annual Return must contain the information regarding:
(a) its registered office, principal business activities, particulars of its holding, subsidiary and associate companies;
(b) its shares, debentures and other securities and shareholding pattern;
(c) its indebtedness;
(d) its members and debenture-holders along with changes therein since the close of the previous financial year;
(e) its promoters, directors, key managerial personnel along with changes therein since the close of the previous financial year;
(f) meetings of members or a class thereof, Board and its various committees along with attendance details;
(g) remuneration of directors and key managerial personnel;
(h) penalty or punishment imposed on the company, its directors or officers and details of compounding of offences and appeals made against such penalty or punishment;
(i) matters relating to certification of compliances, disclosures as may be prescribed;
(j) details, as may be prescribed, in respect of shares held by or on behalf of the Foreign Institutional Investors indicating their names, addresses, countries of incorporation, registration and percentage of shareholding held by them; and
(k) such other matters as may be prescribed.
Signing of Annual Return
The annual return of the company must be signed by a director and the company secretary, or where there is no company secretary, by a company secretary in practice.
Under proviso to section 92(1), in case of One Person Company (OPC) and small company, the annual return shall be signed by the company secretary, or where there is no company secretary, by the director of the company.
Also, Central Government may prescribe abridged form of annual return for "One Person Company, small company and such other class or classes of companies as may be prescribed.
Certification of Annual Return
Under sub-section (2) of section 92 of the Act read with rule 11(2) of the Companies (Management and Administration) Rules, 2014:
The Annual Return of a listed company or of a company having a paid up share capital of Rs. 10 Crores or more or turnover of Rs. 50 Crores or more shall be certified by a Practising Company Secretary in the Form No. MGT-8
The certificate shall state that the annual return discloses the facts correctly and adequately and that the company has complied with all the provisions of this Act.
In terms of sub-section (6) of section 92, if a PCS certifies the annual return otherwise than in conformity with the requirements of section 92 or the rules made thereunder, he shall be punishable with fine which shall not be less than Rs. 50,000 but which may extend to Rs. 5 lakh.
Fee fo Filing Annual Return
Statutory fee for filing is based on the authorized capital of the Company, date of the event and date of filing. Additional fee is applicable in case the company files the Annual Return after due date
The late fee for not filing annual return has been significantly increased in 2018 to Rs.100 per day of default.
a) List of shareholders, debenture holders
b) Approval letter for extension of AGM, if any
c) Copy of MGT- 8 (paid up share capital of ten crore rupees or more or turnover of fifty crore rupees or more)
d) Optional Attachments, If any
Inspection of Annual Return
Copies of annual return shall be open for inspection during business hours, at such reasonable time on every working day as the board may decide, by any member, debenture holder, other security holder or beneficial owner without payment of fee and by any other person on payment of such fee as may be specified in the articles of association of the company but not exceeding fifty rupees for each inspection.
Preservation of Annual Return
Copies of all annual returns and copies of all certificates and documents required to be annexed thereto shall be preserved for a period of eight (8) years from the date of filing with the Registrar.