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Day To Day Compliances

This page contains the information about the various compliances required to be done by the Company, its Directors and officers under the Companies Act, 1956. Information related to punishment provisions and whether the offence is compoundable or not is also provided.

Day to day compliance to be made by a company or director or officer or persons under the Companies Act, 1956

Sr. No. Nature of Compliance Reference Section Punishment provision Whether offence is compoundable on application under section 621 A
1. No company, association, partnership can be formed consisting of certain number of person, unless it is registered under the Act as a company. (For banking 10 or more and 20 or more for other business) Section 11 All the persons who are members of such organization are punishable with a fine which may extend to Rs. 10,000/- Yes
2. Company needs to send to the members within 7 days of his application to the company along with a fee of Rs. 1/- each latest copy of the following:
     
  • its Memorandum
  • its Articles, if any
  • every agreement or resolution referred to in the section 192
Section 39 Applicable to both companies. Company and every officer of the Company who is in default shall be punishable for each offence with a fine which may extend to Rs. 500/- Yes
3. Alteration in object clauses or registered office clause or name clause or capital clause of the Memorandum of Association and Alteration in the Articles of Association is required to be carried out in all the copies. Section 40 Applicable to both companies. Company and every officer of the Company who is in default shall be punishable with a fine which may extend to Rs. 100/- for each copy so issued without carrying out the alterations. Yes
4. Alteration required to be carried out in all the copies of resolutions passed or agreements executed as referred to in section 192. Section 40 Applicable to both companies. Company and every officer of the Company who is in default shall be punishable with a fine which may extend to Rs. 100/- for each copy so issued without carrying out the alterations. Yes
5. Compliance of all the provisions of section 3 (1) (iii) of the Act by a private limited company i.e.
a) Restriction on right to transfer

b) Limit the number of members to 50

c) Prohibit the invitation to public to subscribe for its shares or debentures

d) Prohibits invitation or acceptance of deposits other than its members, directors or their relatives.
Section 43 Applicable to private company On default made in complying with the provisions, company ceased to be entitled to the privileges and exemptions conferred on it as a private limited company under or by the Act. ----
6. Number of members of the company are always required to be maintained at the following level:
2 in case of private company and,

7 in case of public company
Section 45 Applicable to both companies If company carries on business for more than 6 months with such reduced numbers then every person who is a member of the company at that time and is cognizant of the fact shall be severally liable for the payment of the whole debts of the company contracted that time and may be severally sued therefore. ----
7. Normally all the investments made by the Company are required to be held by it in its own name.
If the investments are not held in the name of the company then register is required to be maintain and details of the same are required to be entered therein and inspection of the same is also require to be allowed.
Section 49 Applicable to both companies. Company and every officer of the Company who is in default is punishable with a fine which may extend to Rs.50,000/- Yes
8. Offer or invitation to 50 or more persons to subscribe for shares or debentures of the Company Section 67 Applicable to both companies. The said offer will be treated as public offer for shares or debentures and accordingly compliance of the various provisions will be essential. Additionally, for private company it will be contravention of basic condition under section 3 (1) (iii) ----
9. Any person knowingly or recklessly making a statement, promise or forecast which is false, deceptive or misleading, or dishonest concealment of material facts induces or attempt to induce another person to enter into any agreement relating to acquisition, purchase etc. of shares or debentures of the Company. Section 68 Applicable to both companies. Such person shall be punishable with imprisonment for a term which may extend to 5 years or with fine which may extend Rs. 1.00 lacs or with both. Yes
10. Any person who makes in a fictitious name an application to the Company for acquiring or subscribing for shares or; Otherwise induces a company to allot or register transfer of shares on a fictitious name Section 68 Applicable to both co. Such person shall be punishable with imprisonment for a term which may extend to 5 years. Yes
11. No direct or indirect Loans to be made or guarantees to be provided or financial assistance to be made to any person by a company to purchase or subscribe for the shares in the company or in its holding company. (Subject to certain exemptions provided in the section) Section 77 Applicable to Public and private co. which is subsidiary of public Company and every officer of the company who is in default shall be punishable with a fine which may extend to Rs. 10,000/- Yes
12. No duplicate or renewal of certificate for shares is to be made by the Company with an intention to defraud. Section 84 Applicable to both companies. Company shall be punishable with a fine which may extend to Rs. 10,000/- and for every officer who is in default, imprisonment for a term which may extend to 6 months or with fine which may extend to Rs. 1.00 lacs or both. Yes
13. Issue of certificate within 3 months from the date of allotment of shares/ debentures etc. and within 2 months from the date of delivery of valid application to the company for registration of transfer. On application central government can extend the period of delivery of certificates by further period of 9 months Section 113 Applicable to both companies Company and every officer of the Company who is in default shall be punishable with a fine which may extend to Rs. 5,000/- for everyday during which default continues. Yes
14. Any person deceitfully personates an owner of any share or interest in the company and thereby attempts to or receive any money due to any such owner. Section 116 Such person shall be punishable with imprisonment for a term which may extend to 3 years and shall also liable to fine. ----
15. Copy of every instrument creating any charge on the property of the company requiring registration under the Act needs to be kept at the registered office of the Company. Section 136 Applicable to both companies Company and every officer of the company who is in default or such other person shall be punishable with fine which may extend to five thousand rupees and where the contravention is a continuing one, with a further fine which may extend to five hundred rupees for every day after the first during which the contravention continues. Yes
16. Company shall have a registered office to which all communications and notices may be addressed Section 146 (1) Applicable to both companies Company and every officer of the company who is in default shall be punishable with a fine which may extend to Rs. 500/- for every day during which the default continues. Yes
17. Painting or affixing of name and the address of registered office of the company outside every office or place of business in a conspicuous position and in legible letters in any one of the language in general use in that locality. Section 147 (1) (a) Applicable to both companies Company and every officer of the company who is in default shall be punishable with a fine which may extend to Rs. 500/- per day till the name and address is not painted or affixed. Yes
18. Name of the company shall be engraved in legible characters on its seal Section 147 (1) (b) Applicable to both companies Company shall be punishable with a fine which may extend to Rs. 5000/-. If any officer contravene the provisions of section 147 (1) (b) or (c) and use the seal or issues the letters or sign the instruments or invoice or receipts etc. he shall be punishable with a fine which may extend to Rs. 5000/- and shall further liable for bills, hundies, cheques, promissory notes, orders for money or goods for the amount thereof, unless it is duly paid by the Company. Yes
19. Mention of the name and the address of its registered office by the company in all its business letters, bill heads, letter papers, its notices, bills, hundies, cheques, promissory notes, orders for money or goods, letter of credits, invoice, receipts etc. Section 147 (1) (c) Applicable to both companies Company shall be punishable with a fine which may extend to Rs. 5000/-. If any officer contravene the provisions of section 147 (1) (b) or (c) and use the seal or issues the letters or sign the instruments or invoice or receipts etc. he shall be punishable with a fine which may extend to Rs. 5000/- and shall further liable for bills, hundies, cheques, promissory notes, orders for money or goods for the amount thereof, unless it is duly paid by the Company. Yes
20. Any notice, document, letter issued by the Company containing a mention of Authorised Capital of the Company, then it shall also contain the amount of subscribed and paid up capital of the Company Section 148 Applicable to both the companies Company and every officer of the Company who is in default shall be punishable with a fine which may extend to Rs. 10,000/- Yes
21. Commencement of business or exercising of borrowing powers by a company without complying the provisions of section 149 or contravention of the provisions Section 149 Applicable to Public Co. Every person who is responsible for contravention without prejudice to any other liability be punishable with a fine which may extend to Rs. 5000/- for every day during which the contravention continues. Yes
22. Company may close the register of members/ debenture holders after giving newspaper notice of not less than 7 days. And the closure period shall not exceed 30 days at any one time and aggregate closure period shall not exceed 45 days in a year. Section 154 Applicable to both the companies Company and every officer of the Company who is in default shall be punishable with a fine which may extend to Rs. 5000/- for every day during which the registered is so closed (without complying the provisions of section) Yes
23. Filing of Annual Return with ROC within 60 days of AGM Section 159 and Section 160 Penalty provided in section 161 Company and every officer of the Company who is in default shall be punishable with a fine which may extend to Rs. 500/- for every day during which default continues Yes
24. Signing of Annual return and Certification of Annual Return of listed company by PCS Section 161 Penalty provided in section 161 Company and every officer of the Company who is in default shall be punishable with a fine which may extend to Rs. 500/- for every day during which default continues Yes
25. Failure to Hold statutory meeting and preparation of statutory report by the Company after one month but within six months from the date of commencement of business pursuant to provisions of section Section 165 Applicable to Public Co. Every director or other officer of the Company who is in default shall be punishable with fine which may extend to Rs. 5000/- Yes
26. Holding of Annual General Meeting by a Company every year pursuant to the provisions of section 166 of the Act Holding of Annual General Meeting of the Company as per direction of the government pursuant to the provisions of section 167 of the Act Section 168 Applicable to both companies Company and every officer of the Company who is in default shall be punishable with a fine which may extend to Rs. 50,000/- and in case of continuing default with a further fine which may extend to Rs. 2500/- every day after the first during which the default continues. Yes
27. Every notice calling the meeting of the members shall contain a statement about entitlement of members to appoint one or more proxy to attend and vote at the meeting instead of him and that proxy need not be a member. Section 176 (2) Applicable to both companies Every officer of the Company who is in default shall be punishable with fine which may extend to Rs. 5000/- Yes
28. No invitation to appoint a particular person, as a proxy is to be issued and send by the company to the members entitled to vote at its expenses. Section 176 (4) Applicable to both companies Every officer of the company knowingly issues such invitation or willfully authorises or permits their issue shall be punishable with a fine which may extend to Rs. 10,000/- Yes
29. No document or report of the proceedings of any general meeting shall be circulated or advertised at the expenses of the Company unless it includes the matters required by section 193 to be contained in minutes. Section 197 Applicable to both companies Company and every officer of the Company who is in default shall be punishable in respect of each offence, with fine which may extend to Rs. 5000/- Yes
30. Company shall not pay to any officer or employee thereof, whether in capacity as such or otherwise, remuneration free of any tax, or other calculated by reference to, or varying with, any tax payable by him, or the rate or standard rate of any such tax, or the amount thereof. Section 200 Applicable to both companies Fine up to Rs.5,000/- and further fine up to Rs.500/- for each day of default. Yes
31. Any provision, contained in the articles of a company or in an agreement with a company or in any other instrument, for exempting any officer of the company or any person employed by the company as auditor from, or indemnifying him against, any liability which, by virtue of any rule of law, would otherwise attach to him in respect of any negligence, default, misfeasance, breach of duty or breach of trust of which he may be guilty in relation to the company, shall be void Section 201 Applicable to both co.   ----
32. Un discharged insolvent not to take part in formation or promotion of the Company or not to discharge any function as a Director or manager of the company secretary in practice (including unregistered company and body corporate having a place of business in India) Section 202 Applicable to both companies. Such person shall be punishable with imprisonment for a term which may extend to 2 years or with a fine which may extend to Rs. 50,000/- or with both. Yes
33. Company shall not appoint or employ any firm or body corporate to or in office or place of profit (other than trustees) for a term exceeding 5 years at a time. Section 204 Applicable to public and Pvt co. which is subsidiary of public . Fine up to Rs.5,000/- and further fine up to Rs.500/- for each day of default. Yes
34. Company has to place annual accounts and balance sheet before each annual general meeting of the company as per provisions of section 210 Section 210 Applicable to both companies. Director or a person who has been charged with the duty of seeing the compliance, fails to take reasonable step, shall in respect of each offence be punishable with imprisonment for a term which may extend to 6 months or with a fine, which may extend to Rs. 10,000/- or with both. Yes
35. Balance sheet and profit and loss account shall be in a format prescribed in the section and shall also comply with all the requirements of section Section 211 Applicable to both companies. Director or a person who has been charged with the duty of seeing the compliance, fails to take reasonable step, shall in respect of each offence be punishable with imprisonment for a term which may extend to 6 months or with a fine, which may extend to Rs. 10,000/- or with both. Yes
36. Balance sheet of holding company shall include certain particulars of its subsidiaries, if any as provided in section Section 212 Applicable to both companies. Director or a person who has been charged with the duty of seeing the compliance, fails to take reasonable step, shall in respect of each offence be punishable with imprisonment for a term which may extend to 6 months or with a fine, which may extend to Rs. 10,000/- or with both. Yes
37. Board Report prepared in accordance with the section shall be attached with every balance sheet of the company. Section 217 Applicable to both companies. Director or a person who has been charged with the duty of seeing the compliance, fails to take reasonable step, shall in respect of each offence be punishable with imprisonment for a term which may extend to 6 months or with a fine, which may extend to Rs. 20,000/- or with both. Yes
38. Improper issue, circulation or publication of balance sheet or profit and loss account Section 218 Applicable to both companies Company and every officer of the Company who is in default shall be punishable with fine which may extend to Rs. 5000/- Yes
39. Copies of balance sheet together with all annexure and attachments are required to be send to each member, trustee of debenture holder of the company and on demand to debenture holder and depositor Section 219 Applicable to both companies Company and every officer of the Company who is in default shall be punishable with fine which may extend to Rs. 5000/- Yes
40. Filing of copies of balance sheet and other documents to Registrar within 30 days of AGM Section 220 Penalty provided in section 161 Company and every officer of the Company who is in default shall be punishable with a fine which may extend to Rs. 500/- for every day during which default continues Yes
41. Officer of the company is required to make disclosure and to furnish information about the entries in the accounts or payments made to directors etc as and when required or asked to do so. Section 221 Applicable to both companies. Person knowingly make default in performing his duty under section shall be punishable with imprisonment which may extend to 6 months or with fine which may extend to Rs. 50,000/- or with both. Yes
42. Auditors report shall be read before the company in the Annual General Meeting and shall be open for inspection by the members. Section 230 Applicable to both companies. Company and every officer of the Company who is in default shall be punishable with fine which may extend to Rs. 5000/- Yes
43. All notices and communications of any general meeting of the Company shall be send to auditors and auditor shall be entitled to attend and to be heard on the relevant part of business at any general meeting Section 231 Applicable to both companies. Company and every officer of the Company who is in default shall be punishable with fine which may extend to Rs. 5000/- Yes
44. On receipt of order/ instruction from the Registrar, every officer of the company shall furnish such information or explanation on any document submitted to him. Section 234 Applicable to both companies. Company or any person or officer refuses or neglects to furnish such information or explanation or produce any books and papers, the company and each such person or officer shall be punishable with fine which may extend to Rs. 5000/- and in case of a continuing offence, with additional fine which may extend to Rs. 500/- for every day after the first during which the offence continues. Yes
45. Minimum number of Directors Public Company: 3 (May also have small shareholders director) Other Company: 2 Section 234 Applicable to both companies. Section 252 Fine up to Rs.5,000/- and further fine up to Rs.500/- for each day of default. Yes
46. Only individuals to be directors of the Company Section 253   No
47. Consent to act as a Director is required to be filed with Registrar at the time of his appointment Section 264 Applicable to Public Ltd. Company and Private limited company which is a subsidiary of a Public Ltd. Company He shall not act as a Director till he files the consent to Registrar. Fine up to Rs.5,000/- and further fine up to Rs.500/- for each day of default. Yes
48. Any person who is a Managing Director/ Whole Time Director of the Company shall not be undischarged insolvent or suspends or suspended the payment to its creditors or has at any time convicted by a court of an offence involving moral turpitude. Section 267 Applicable to both companies. Fine up to Rs.5,000/- and further fine up to Rs.500/- for each day of default. Yes
49. If required by the Articles every director is require to hold the qualification shares in the Company within 2 months of his appointment. Section 270 Applicable to public and Pvt co. which is subsidiary of public Section 272 Any person who fails to hold qualification shares or acts as a Director after the expiry of 2 months shall be punishable with a fine which may extend to Rs. 5000/- for every day between such expiry and the last day on which he acted as a Director. Yes
50. No person to be appointed as Director, if he found disqualified under the provisions of Section. Pvt Co can have more restriction by its articles Section 274 Applicable to both companies. Fine up to Rs.5,000/- and further fine up to Rs.500/- for each day of default. Yes
51. No person shall at the same time hold office of director in more than 15 Public Companies Section 275 Applicable to both companies. Section 279 Any person who holds office in more than 15 companies in contravention of provisions of the Act shall be punishable with fine, which may extend to Rs. 50,000/- in respect of each such additional company. Yes
52. Every Company shall have at least one Board Meeting in every 3 months and at least 4 such meetings shall be held in every year. Section 285 Applicable to both companies. Default is punishable under Section 629A Yes
53. Every director who is interested either directly or indirectly in any contract or arrangement with by the company are required to disclose his interest to the Board by the means provided in section 299. In case of contract with another company having common director/s, 2% or more shareholding in that company by the directors singly or together is essential. Otherwise disclosure is not compulsory. Section 299 Applicable to both Co. And for contracts and arrangements with any party or entity or body corporate Section 299 (4) Every director who fails to comply this, shall be punishable with a fine which may extend to Rs. 50,000/- Section 283 (1) (i) Automatic vacation of office by a Director and pursuant to sub section (2A) if he functions as a director in spite of his vacation, shall be punishable with fine which may extend to Rs. 5,000/- on each day for such function Yes
54. No Director shall take part in discussion and voting on any contract or arrangement in which he is interested Section 300 Applicable to public and Pvt co. which is subsidiary of public Section 299 (4) Every director who fails to comply this, shall be punishable with a fine which may extend to Rs. 50,000/- Section 283 (1) (i) Automatic vacation of office by a Director and pursuant to sub section (2A) if he functions as a director in spite of his vacation, shall be punishable with fine which may extend to Rs. 5,000/- on each day for such function Yes
55. Every director has to disclose his appointment and relinquishment of office in another company or body corporate within 20 days. Section 305 Applicable to both companies If he fails to do so, he shall be punishable with fine which may extend to Rs.5000/- Yes
56. Notice by a director or deemed director of his shareholding in the company or holding or subsidiary company and interest and right in such shares. Section 308 Applicable to both companies Any person who fails to comply with the section shall be punishable with imprisonment for a term which may extend to 2 years or with fine, which may extend to Rs. 50,000/- or with both. Yes
57. Assignment of his office by a Director shall be void Section 312 Applicable to both companies   ----
58. Managing Director shall not be appointed for a term exceeding 5 years. Section 317 Applicable to public and Pvt co. which is subsidiary of public   ----
59. Every Company having a paid up share capital of Rs. 5.00 crores or more shall have a whole time secretary Section 383A(1) Applicable to both Co Company and every office of the Company who is in default, shall be punishable with fine which may extend to Rs. 500/- for every day during which the default continues. Yes
60. Every Company not required to employ a whole time secretary and have a paid up share capital of Rs. 10.00 lacs or more shall file a compliance certificate obtain from the secretary in whole time practice with the Registrar every year Section 383 – A First proviso Applicable to both Co Company and every office of the Company who is in default, shall be punishable with fine which may extend to Rs. 500/- for every day during which the default continues. Yes
61. Every person or other agent of the Company who enters into a contract for and on behalf of the company in which company is a undisclosed principal shall have to deliver the memorandum of terms and conditions and copy of contract to be send to company and each director Section 416 Applicable to public and Pvt co. which is subsidiary of public Contract is voidable at the option of the Company. Such person who is in default shall be punishable with fine which may extend to Rs.2000/-. Yes
62. Keeping or depositing the security deposit received by a Company from its employee as per provisions of section 417 Section 417 Applicable to both companies Section 420 Any officer of the Company or trustee of the PF Fund, who knowingly contravenes the provisions or authorises or permits such contravention, shall be punishable with imprisonment for a term which may extend to 6 months or with fine which may extend to Rs. 10,000/- Yes
63. Keeping or depositing all the contributions made to the provident fund constituted by the Company as per provisions of section 418 Section 418 Applicable to both Co Section 420 Any officer of the Company or trustee of the PF Fund, who knowingly contravenes the provisions or authorises or permits such contravention, shall be punishable with imprisonment for a term which may extend to 6 months or with fine which may extend to Rs. 10,000/-. Yes
64. Employee can seek the bank receipt of any money referred to in section 417 or 418 from the company Section 419 Applicable to both Co Section 420 Any officer of the Company or trustee of the PF Fund, who knowingly contravenes the provisions or authorises or permits such contravention, shall be punishable with imprisonment for a term which may extend to 6 months or with fine which may extend to Rs. 10,000/-. Yes
65. A person who make any statement in any return, report, document etc. of the Company which is false in any material particular knowing it to be false; or which omits any material fact knowingly it to be material. Section 628 Applicable to both companies Shall be punishable with imprisonment for a term which may extend to 2 years and shall also be liable to fine. No
66. Intentional false evidence by any person Section 629 Applicable to both companies Shall be punishable with imprisonment for a term which may extend to 7 years and shall also be liable to fine. No
67. Wrongful holding of property of the Company by an employee or officer of the company Section 630
Applicable to both companies
He shall, on the complaint of the company or any creditor or contributory thereof, be punishable with fine which may extend to ten thousand rupees. Yes
68. Improper use of words `limited’ or `private limited’ by any person Section 631 Applicable to both companies Shall be punishable with fine which may extend to Rs. 500/- for every day upon which that name or title has been used. Yes
69. Affixing of Common Seal of the Company in the presence of director or authorised officer Pursuant to provisions of Articles or Regulation 84 of Table A of Schedule I of the Act   ----
70. Every offence under the Act is non cognizable Section 624 Applicable to both companies   ----
71. Penalty where no specific penalty is provided elsewhere in the Act Section 629A Applicable to both companies Company and every officer who is in default or such other person shall be punishable with fine which may extend to Rs. 5000/-, and where the contravention is a continuing one, with a further fine which may extend to Rs. 5000/- for every day after the first during which the contravention continues. Yes
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