OPC/Company Compliance

Change in Registered office of company

A change in the registered office of a company involves shifting the company’s official address, which is registered with the Registrar of Companies (ROC). This change requires compliance with the Companies Act, 2013, and involves passing a board resolution and a special resolution in certain cases, depending on the nature and location of the change. The company must file the necessary forms, including Form MGT-14 and Form INC-22, with the ROC within the prescribed time. The change in registered office is updated in the company’s records and the ROC’s database after verification and approval. This process ensures that all official communications and legal documents are addressed to the company’s new registered office.

An increase in authorized share capital involves altering the company’s Memorandum of Association to raise the maximum amount of share capital that the company is authorized to issue. This is typically done to facilitate future fundraising, issue bonus shares, or accommodate business growth. The process requires passing a special resolution in a general meeting, followed by filing the necessary forms, including Form SH-7, with the Registrar of Companies (ROC). The ROC updates the company’s records after verifying the compliance and payment of requisite fees. This increase allows the company to issue more shares, thereby enabling it to raise additional capital for its business objectives.

A change in paid-up share capital occurs when a company alters the amount of share capital that has been paid up by its shareholders. This can happen due to various reasons such as further issue of shares, buyback of shares, or reduction of share capital. To effect this change, the company must comply with the relevant provisions of the Companies Act, 2013, and pass the necessary resolutions. For an increase, the company may issue new shares, while for a decrease, it may follow the process of share buyback or reduction of capital, which involves specific legal procedures and approvals. The company must file the required forms with the Registrar of Companies (ROC), such as Form PAS-3 for allotment of shares or Form SH-4 for share transfer, ensuring compliance with regulatory requirements. The change in paid-up share capital is reflected in the company’s financial statements and ROC records.

Appointment of Director

The appointment of a director in a company involves selecting and approving an individual to serve on the company’s board of directors. This process typically begins with identification of the need for a new director, followed by nomination and evaluation of potential candidates. The board of directors or shareholders, depending on the company’s Articles of Association and applicable laws, approve the appointment through a resolution. The company must obtain the director’s consent and ensure compliance with regulatory requirements, including obtaining a Director Identification Number (DIN) if not already held. Forms DIR-2 (consent to act as director) and DIR-12 (particulars of appointment of directors) are filed with the Registrar of Companies (ROC) within the prescribed time. The appointment of a director brings new expertise, perspectives, and leadership to the company, contributing to its strategic direction and governance.

Removal of Director

The removal of a director in a company involves terminating their position on the board of directors before the expiry of their term. This can be done through a special resolution passed by the shareholders in a general meeting or by the board of directors under specific circumstances outlined in the company’s Articles of Association or the Companies Act, 2013. The process requires giving the director concerned a reasonable opportunity to be heard and complying with applicable laws and regulations. The company must file Form DIR-11 with the Registrar of Companies (ROC) within 30 days of the director’s removal, along with the necessary resolutions and explanations. The removal of a director may be due to various reasons such as non-performance, conflict of interest, or change in business strategy, and it allows the company to restructure its board for better governance and decision-making.

Change in Object Clause

A change in the object clause of a company involves altering the stated objectives and purposes for which the company was incorporated, as specified in its Memorandum of Association. This change requires a special resolution passed by the shareholders and approval from the Registrar of Companies (ROC) or the Central Government, depending on the nature of the change. The company must file Form MGT-14 with the ROC within 30 days of passing the special resolution, along with the amended Memorandum of Association. The change in object clause allows the company to diversify its business, pursue new opportunities, or shift its focus, enabling it to adapt to changing market conditions and business needs while ensuring compliance with regulatory requirements.

Inspect Documents (with search report)

Inspection of documents in a company involves reviewing and examining various corporate records and documents, such as registers, minutes books, and agreements, to ensure compliance and verify the company’s affairs. Directors, shareholders, and regulatory authorities may have the right to inspect certain documents under the Companies Act, 2013. The inspection can be conducted at the company’s registered office or through electronic means, depending on the nature of the documents and the company’s practices. The purpose of document inspection is to ensure transparency, verify compliance with legal requirements, and facilitate informed decision-making. Companies are required to maintain accurate and up-to-date records, allowing authorized persons to inspect these documents during business hours.

Statutory Registers

Statutory registers are official records that companies are required to maintain under the Companies Act, 2013, and other applicable laws. These registers contain vital information about the company’s operations, governance, and compliance, such as details of directors, key managerial personnel, shareholders, charges, and meetings. Examples of statutory registers include the Register of Directors, Register of Members, Register of Charges, and Minutes Book. Companies must ensure that these registers are accurately maintained, updated regularly, and made available for inspection by authorized persons, including regulatory authorities and shareholders. Maintaining statutory registers helps companies demonstrate compliance with legal requirements, promote transparency, and facilitate good corporate governance.

Creation of Charge

Every company, regardless of its size, requires funds to support its operations and growth. These funds can be raised either through share capital or by borrowing from banks or financial institutions. When a company chooses to borrow, it often provides its assets or properties as security for the loan. This process is known as the creation of charge on the company’s assets.

Modification of Charge

Modification of a charge involves altering the terms or particulars of an existing charge registered with the Registrar of Companies (ROC). This can include changes in the amount secured, assets charged, or terms of repayment. The company must file Form CHG-1 or Form CHG-9, as applicable, with the ROC within 30 days of modification, providing details of the changes made to the charge. The ROC updates the records accordingly after verifying the compliance. Modification of charge allows companies to adapt to changing financial circumstances or requirements while ensuring that the security interests of lenders are protected and publicly disclosed. It helps maintain accurate records and transparency in financial transactions.

Satisfaction of Charge

Satisfaction of charge occurs when a company repays a debt or fulfills the obligations secured by a charge registered with the Registrar of Companies (ROC). Upon full repayment, the company can file Form CHG-4 with the ROC to record the satisfaction of charge. This form provides details of the charge and confirmation that the debt has been fully repaid. The ROC updates its records to reflect that the charge has been satisfied, indicating that the company’s assets are no longer encumbered by the charge. Satisfaction of charge is essential for maintaining accurate records and providing clarity on the company’s financial position, as it removes the public notice of the security interest over the company’s assets.

Surrender of DIN

Surrender of Director Identification Number (DIN) involves the cancellation of a DIN granted to an individual who no longer intends to be a director in any company. The individual can apply for surrender of DIN by filing Form DIR-5 with the Registrar of Companies (ROC), providing reasons for surrender and confirming that they are not a director in any company. Upon verification, the DIN is marked as deactivated or surrendered in the MCA database. Surrender of DIN is useful for individuals who have ceased to be directors and wish to disassociate themselves from any potential liabilities or obligations associated with being a director. It helps maintain accurate records and ensures compliance with regulatory requirements.

Removal/Resignation of Auditor of Company

The removal or resignation of an auditor in a company involves the termination of the auditor’s appointment before the expiry of their term. Removal of an auditor requires a special resolution passed by the shareholders in a general meeting, while resignation is initiated by the auditor themselves. The company must file Form ADT-1 with the Registrar of Companies (ROC) within 30 days of removal or resignation, providing details of the change in auditor. In case of resignation, the auditor must file Form ADT-3 with the ROC, stating the reasons for resignation. The removal or resignation of an auditor allows companies to change their audit firm due to various reasons such as change in business needs, audit firm rotation, or disagreements over audit practices, ensuring that the company’s audit requirements are met.

Transfer of Shares

The transfer of shares in a company involves the voluntary or involuntary transfer of ownership of shares from one person to another. The transferor (seller) and transferee (buyer) execute a share transfer deed, and the transfer is recorded in the company’s Register of Members. The company must ensure compliance with the Companies Act, 2013, and its Articles of Association. In case of transfer, the company must verify the transfer documents, including the share transfer form, and update its records accordingly. For listed companies, the transfer of shares is typically facilitated through stock exchanges and depositories. The transfer of shares enables shareholders to liquidate their investment or change their ownership structure, while the company benefits from the flexibility and liquidity in its shareholding.

Closure of Company

The closure of a company, also known as winding up, involves the dissolution of a company by liquidating its assets, settling its liabilities, and distributing any remaining surplus to its shareholders. A company can be wound up voluntarily by its shareholders or creditors, or compulsorily by a court order. The process involves appointing a liquidator to manage the winding-up process, realizing the company’s assets, paying off debts, and distributing the remaining assets according to the priority of claims. The company must file various forms with the Registrar of Companies (ROC), including Form MGT-14 for passing the winding-up resolution and Form STK-1 to STK-7 for striking off the company’s name from the ROC register. Upon completion of the winding-up process, the company is dissolved, and its name is struck off from the ROC register, marking the end of its legal existence.