What and Why Compliance Certificate

What and Why Compliance Certificate COMPLIANCE CERTIFICATE (1) Every Company not required to employ a whole time secretary under sections 383A(1) of the Act and having a paid-up share capital of Rs. 10,00,000/- or more but less than Rs. 5,00,00,000/- shall obtain a Secretarial Compliance Certificate from a company secretary in whole time practice and shall be laid by the company in its annual general meeting (2) The said company shall file with ROC the said Secretarial Compliance Certificate in the prescribed form (E form 66 ) download from (http://www.mca.gov.in/MCA21/Download_eForm_choose.html) (3) Where the annual general meeting of such company for any year has not been held, such Secretarial Compliance Certificate has to be filed with the Registrar within thirty days from the last day on or before which that meeting should have been in accordance with the provision of the Act. (4) A copy of such certificate shall be attached with Board's report referred to in section 217. Compliance Certificate Presentation For more about procedure and check list please download the below link. http://www.caclubindia.com/share_files/compliance-certificate--57752.asp LEGAL FRAMEWORK Sec.383A. Certain companies to have secretaries— 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 provisions of this Act and a copy of such certificate shall be attached with Board's report referred to in section 217. (1A) If a company fails to comply with the provisions of sub-section (1), the company and every officer of the company who is in default, shall be punishable with fine which may extend to 10[five hundred rupees] for every day during which the default continues: Provided that in any proceedings against a person in respect of an offence under this sub-section, it shall be a defence to prove that all reasonable efforts to comply with the provisions of sub-section (1) were taken or that the financial position of the company was such that it was beyond its capacity to engage a whole-time secretary. Where, at the commencement of the Companies (Amendment) Act, 1974 (41 of 1974) (a) any firm or body corporate is holding office, as the secretary of a company, such firm or body corporate shall, within six months from such commencement, vacate office as secretary of such company; (b) any individual is holding office as the secretary of more than one company having a paid-up share capital of rupees twenty-five lakhs or more, he shall, within a period of six months from such commencement, exercise his option as to the company of which he intends to continue as the secretary and shall, on and from such date, vacate office as secretary in relation to all other companies]. The Companies (Compliance Certificate) Rules, 2001 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: - 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. 2. Definition :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. 3. Other Conditions: (1) Every company not required to employ a whole-time secretary under subsection (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 filed 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 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. 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 complied 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 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. 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 filed return of deposit with the Registrar of Companies/Reserve Bank of India/other authorities. 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 complied 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 417(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 places. 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 filed 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----------------------- Thanks and Regards K.V.SAVEESH NAIR Email: kvsaveeshnair@gmail.com