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Know the 8 Key Compliances for getting Private Limited Company Registrations

Online Legal India LogoBy Ankar Kapuria Published On 11 Jan 2022 Category Company Registration

The registration of businesses under the model of Private Limited Company Registrations has seen a significant rise in recent years. It has become one of the most sought-after models of getting businesses registered because of various factors. As per the recent reports, Company Registrations have seen a jump of around 26 percent.

This data is a staggering milestone as compared to the reports of the previous years without the restrictions of the Covid-19 Pandemic. There are several factors that have contributed to the same such as the steps of registration, advantages, and compliance policies.

What are the Benefits of Compliance of Private Limited companies?

Getting the company registered under the guidelines of the private limited company registration has several benefits such as: 

  • It helps establish the credibility of the company and allows for trust to be built with the investors and customers.

  • Because of its compliance with the rules and regulations, one is able to get the benefit of attracting investors towards themselves.

  • Getting regular compliance results can help keep the status of the company active and help them avoid huge fines on payment of fees.

Compliance for Private Limited Company Registrations

Every registration comes with a certain set of rules and regulations that needs to be followed in order to get the best results. These compliance policies allow the businesses to follow a standard mode of operation under which all companies operate. Some of the important Compliances for the private Limited Company to get registered under the Companies Act, 2013 are:

  • Meeting of the Board of Directors is of utmost importance as they are the most influential bodies. It is to be held within 30 days of getting incorporated and there need to be four board meetings held every year. The duration between these meetings should not exceed more than 120 days. 

  • Issue of Share Certificates has to be done within 2 months from the date of allotment and is one of the important compliance under Section 53 of the Companies Act of 2013. 

  • Appointment of Auditors has to be done by the board of directors within 30 days of getting incorporated. The auditor can hold this position till the end of the first annual general meeting. 

  • Minutes of the Meetings are to be recorded and are governed by Section 118 of the Companies Act. It includes an accurate summary and conclusion of all of the proceedings. It has to be signed by the chairman of the meeting or a duly authorized representative of the company. 

  • Filing of Disclosure of Interest by Directors is an essential part under Section 184 of the Companies Act of 2013 that addresses the disclosure of a director’s conflict of interest. Failing to report such can result in imprisonment up to 1 year or a fine of ?50,000/- to ?1,00,000/- or both.

  • Regulation of Financial Statements is essential as it requires the financial statements within 30 days of the annual general meeting. This needs to be approved by the Board of directors and signed by the Chairperson. 

  • A report by the Board of Directors is to be provided along with all the details of the company at every annual general meeting. Defaulting against the compliance policy can result in the individual and the company getting fined. 

  • Filing of Annual Returns with the Registrar of Companies is mandatory for all companies as per Section 92 of the Companies Act, 2013.  It is to be signed by at least one director and certified by a company secretary.

Conclusion

Private Limited Companies have gained significant importance in recent times due to the huge increase in the number of registrations. This is due to the ease of convenience that it provides to the businesses and the compliance that the businesses have to abide by. This helps them get the benefits of getting themselves registered as a private limited company.


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