Step-by-Step Tutorial on Mandatory Legal Compliance for Private Limited Companies under Companies Act, 2013

Operating a Private Limited Company in India involves adhering to numerous mandatory compliances as mandated by the Companies Act, 2013. These set the legal framework within which companies must operate and report various aspects of their business. Here’s a step-by-step guide to ensure your company meets all mandatory legal compliances:

Step 1: Convene the Initial Board of Directors Meeting

Hold the first meeting of the Board of Directors within 30 days of company incorporation.
Schedule at least four board meetings throughout the financial year, maintaining a maximum gap of 120 days between two meetings.

Step 2: Issue Share Certificates

Issue Share Certificates to the subscribers of the memorandum within 60 days of incorporation.
Keep a record of the share certificates issued for transparency and statutory compliance.

Step 3: Appoint Statutory Auditors

Appoint a practicing Chartered Accountant as the company auditor.
This appointment should be made by the Board of Directors within 30 days of incorporation, or by the members in an Extraordinary General Meeting within 90 days.
Re-appoint or ratify the appointment in each subsequent Annual General Meeting.

Step 4: Document Board and General Meetings Minutes

Record the minutes of all Board of Directors and General meetings.
Ensure this is completed within 30 days following the conclusion of each meeting.

Step 5: Disclose Directors’ Interests

Each director must disclose any interest in other business entities at their first board meeting as director and subsequently at the first board meeting in each financial year.
Submit their disclosures in FORM MBP-1.

Step 6: Approval and Signing of Financial Statements

Approve financial statements in a board meeting.
Sign them on behalf of the Board by the chairperson or two directors, and by the CFO and Company Secretary if appointed.
Submit these for auditing.

Step 7: Prepare Board of Directors’ Report

Attached to the general meeting financial statements, include a report detailing the state of the company and its compliance with financial and corporate standards.

Step 8: File Financial Statements

File the company’s Financial Statements with the Registrar of Companies within 30 days of the Annual General Meeting using E-FORM AOC-4.
Ensure the form is digitally signed by at least one director and certified by a professional if required.

Step 9: File Annual Returns

File the company’s Annual Return with the Registrar of Companies within 60 days of the Annual General Meeting using E-FORM MGT-7.
Have the form digitally signed by at least one director and certified by a Company Secretary in practice if necessary.

Step 10: Maintain Statutory Registers

Keep up-to-date statutory registers including:
- FORM MGT-1: Register of Members
- FORM MGT-2: Register of Debenture Holders
- FORM MGT-3: Foreign Register of Members and other security holders
- FORM SH-2: Register of Renewed and Duplicate Share Certificates
- FORM SH-3: Register of Sweat Equity Shares
- FORM SH-6: Register of Employee Stock Options
- FORM SH-10: Register of Shares or Securities Bought Back
- FORM CH-7: Register of Charges

Ensure you regularly review compliance regulations as they may be subject to changes. Non-compliance could result in penalties, so maintaining diligence in these areas is crucial for the ongoing operation of your Private Limited Company. Lastly, always confirm with legal advisers or professional consultants to ensure full compliance according to the latest amendments in the law.

Step-by-Step Tutorial on Mandatory Legal Compliance for Private Limited Companies under Companies Act, 2013