Author - Associate Kantika Mukherjee
What are the compliance requirements to do business in India?
Business in India can be formed by various company structures, ranging from a joint venture to a liaison office.
In India business has been made faster by merging the applications for the Permanent Account Number (PAN) as well as the Tax Account Number (TAN) as well as with the incorporation procedure under the Ministry of Corporate Affair (MCA). Though, it takes few weeks to complete all the necessary procedures to form a company, along with the fees and additional costs reliant on the size and type of business being registered.
The types of Company Registration in India as per Companies Act 2013 are; Private Limited Company; Public Limited Company; Unlimited Company; Partnership; Limited Liability Partnership; One Person Company; Sole proprietorship; Section 8 Company; Subsidiary Company; Liaison Office / Representative Office; Project Office; Branch Office; Joint Venture Company.
Also startup companies in India can register themselves through either Partnership Firm; Limited Liability Partnership Firm; Private Limited Company;
Compliances requirement for the companies in India
· When the incorporation certificate is obtained, a separate legal entity for the corporation must be established.
· When the company receives its incorporation certificate, within 30 days, then one of the directors should issue the notice for the first board meeting of the corporation, at least 7 days before the latter being scheduled for.
· However in the first board meeting, the business must appoint its first auditor within 30 days of incorporation of the firm through its board of directors and every Director of the corporation is required to disclose their concern or interest of the other corporations in the Form MBP-1.
· Furthermore, if there is any change in the interest of Director, then the director must disclose the change in the next upcoming Board meeting and also the director must disclose in the annual disclosure towards being made in the first board meeting of the fiscal year.
· The Corporation must, on and from the 15th day of its incorporation and thereafter, should have a registered office which is capable of receiving and acknowledging the official communications and notices as might be addressed towards it. Verification of the registered office must be filed in Form INC-22 within 30 days of incorporation of the company.
· It is essential for the corporation to have its name board outside its registered office, with its name, Company’s Identification Number, address of the registered office, phone number and email id, fax number as well as website address, if any, specified in it.
· It is vital for the corporation to have a PAN (Permanent Account Number) as well as TAN (Tax Deduction and Collection Account Number) just after its incorporation. Also in order to open a Bank Account in India these are the most required and important credentials.
· Issuance of share certificates towards the shareholders is also a significant prerequisite, and every detail of such issuance of share certificate must be maintained and stated in the register of allotment.
· Efficiently maintaining along with filing of profit and loss account, balance sheet, as well as annual return every fiscal year together with an auditor’s report prior to the due date with the ROC is an important requirement of the companies’ act which a corporation has to abide by.
· Every corporation must maintain certain Statutory Registers under the Companies Act, 2013 and should keep and maintain at its registered office in the stated form. If there is any failure in maintaining the statutory register, the corporation, and the directors, might be fined and put on trial.
· The corporation also should conduct minimum 4 board meetings during the calendar year at specified intervals and also make certain that all the minutes of the board meeting are securely retained until the corporation exists.
· The minutes of the meeting should be prepared within 15 days of the meeting and could be finalized within 30 days of the meeting.
· The above mentioned are the non-negotiable compliance that a company needs to follow, however there are some more instance where a corporation is required to intimate the registrar of companies. It consists of appointments of directors, removal of Director as well as certain other changes in the prescribed manner.
· The Companies Act has also introduced the CSR (Corporate Social Responsibility) provisions in the Companies Act, 2013. As per these provisions under the Corporate Social Responsibility, corporations are obliged to make a contribution in certain philanthropic events. Companies should abide to the CSR criteria and commence CSR activities in the fiscal year.
· The mentioned compliance requirements are applicable to the Companies Act, 2013. Additionally to this, further registration is needed, relying on the type of business and business turnover, for instance Professional Tax, GSTN etc.
The policy and procedures regulating and administering the Indian corporation were progressively liberalized and simplified. The companies are required to abide by the several compliances requirements and failing to do so would result into consequences of disqualification of directors, or attracting penal provisions and in few cases even imprisonment of the directors and key employees can take place.
For any Company Compliances/Filings related matter, please Post Your Requirement anonymously and get free proposals OR find the Best Company Compliances/Filings Lawyers and book a free appointment directly.