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The MCA in 2022, issued an amended definition of a small company by increasing their threshold limit of paid up share capital and turnover.
As per section 2(85) of the companies Act, 2013.
The paid-up capital and turnover of the small company shall not exceed Rupees 4 Crores and Rupees 40 Crores, respectively. Revisions to the definition were aimed at simplifying business and reducing compliance burdens for many companies.
However, there are the following companies. If they meet the above criteria, they still do not qualify as a small company:
Small companies under the companies Act, 2013
| S. No | TITLE | SECTION & RULES | Forms | PARTICULAR OF COMPLAINCES |
| 1) | Disclosures by a director of his interest | 184(1) & Rule 9(1) of Companies (Meetings of Board and its Powers) Rules, 2014. | Form MBP-1 | Every director shall at the first meeting of the Board in which he participates as a director and thereafter at the first meeting in every financial year or whenever there is any change in the disclosures Already made, then at the first Board meeting held after such change, disclose his concern or interest in other entities which shall include the shareholding. |
| 2) | Disqualification of directors | 164(2) & 143(3) (g) & Rule 14(1) of Companies (Appointment of Directors) Rules, 2014 | Form DIR-8 | Every director shall inform to the company concerned about his disqualification under sub-section (2) of section 164, if any, before he is appointed or reappointed. |
| 3) | Annual Return | 92(4) & (1) & Rule 11 (1) of Companies (Management And administration) Rules, 2014 | Form MGT-7A | Every Company shall file its Annual Return within 60 days of holding of AGM or where no AGM is held in any year within 60 days from the date on which the AGM should have been held together with the statement specifying the reasons for not holding the AGM. Annual Return of every Small Company shall be Signed by the company secretary, or where there is no company secretary, by the director of the company |
| 4) | Financial statement | 137 & Rule 12(1) of Companies (Accounts) Rules, 2014 | E-Form AOC-4 | Company is required to file its financial statements, including consolidated financial statement along with all the documents required to be or attached to such financial statements, duly adopted at the AGM of the company with the Registrar within 30 days of the date of AGM or in case financial statements are adopted in the adjourned AGM, within 30 days of the date of adjourned AGM. |
| 5) | Board Report | 134 & Rule 8 of the Companies (Accounts) Rules, 2014 | Board’s Report shall be prepared mentioning all the information required to be included in it for Small Company under Section 134. It should be signed by the “Chairperson” authorized by the Board, where he is not so authorized by at least 2 Directors one of whom shall be a managing director or by the director where There is One (1) director. | |
| 6) | Circulation of Financial Statement & other | Company shall send to all the members of the Company, all trustees for the debenture holders and to all persons being the persons so entitled, copy of the (approved) Financial Statements (including consolidated Financial Statements, if any auditor’s report and every other document required by law to be annexed/ attached to the financial statements) at least 21 clear days before the Annual General Meeting. | ||
| 7) | Notice of AGM | 101 & Rule 18 of the Companies (Management and Administration) Rules, 2014 & SS- 2 | Every notice of AGM shall be prepared as per section 101 and SS-2 Notice of AGM shall be sent to all the directors, members, auditors. | |
| 8) | Board Meeting | 1743(5) & SS-1 | Every Small Company shall hold at least one (1) meeting of the Board of Directors in each half of a calendar year and the gap between the two meetings shall not be less than 90 days. | |
| 9) | Notice of Board Meeting | 173 (3) & SS-1 | A meeting of the Board shall be called by giving not less than 7 days’ notice in writing to every director at his address registered with the company and such notice shall be sent by hand delivery or by post or by electronic means. However, meeting of the Board may be called at shorter notice to transact urgent business. | |
| 10) | Appointment of Auditor | 139(1) & Rule 4(2) of the Companies (Audit and Auditors) Rules, 2014. | E-Form ADT-1 | Auditor shall be appointed for 5 years in the AGM. The company shall inform the auditor concerned of his or its appointment, and also file a notice of such appointment with the Registrar within fifteen (15) days of the meeting in which the auditor is appointed in E-form ADT-1. |
| 11) | Register of Members | 88 & Rule 3 of the Companies (Management and Administration) Rules, 2014. | Form MGT.1 & Form MGT.2 | Company shall keep & maintain the following mandatory Registers: Register of Members, Register of debenture-holders, Register of any other security holders |
| 12) | Passing the Resolution | 179(3) | MGT-14 | Resolution for disclosure of Interest of director with ROC. Resolution for Adoption of Balance sheet Resolution for adoption of Director’s Report. |
| 13) | Statement containing salient features of financial statement of Company | 129(3) | AOC-1 | Small Company is required to file every year in e-form- AOC-1 within 30 days from the date of AGM |
| 14) | Director KYC Submission | Pursuant to Rule 12A of The Companies (Appointment and Qualification of Directors) Rules, 2014 | DIR3KYC | Directors are required to submit their KYC details through Form DIR-3 by September 30th each year, provided their Director Identification Number (DIN) was allotted by March 31st of that year and the status is ‘Approved’. Failure to file DIN eKYC results in a penalty of Rs. 5000. |
| 15) | Return of deposits | Rule 16A of the Companies (Acceptance of Deposits) Rules, 2014 | DPT-3 | Companies must use this form to report details of deposits and other non-deposit receipts annually by June 30th. |
| 16) | Return in respect of outstanding payments to Micro or Small Enterprise | Order dated 22 January, 2019 issue under Section 405 | E-Form MSME-1 | 31st October (For April-Sep) 30th April (For Oct-Mar) and Within 1 month from the conclusion of each half year |
Small companies have fewer compliances and friendly regulations, which reduces the burden on directors. There is an exemption from the CARO Report and an exemption from certification of the annual return by PCS. There are lower fees and penalties than for other private or public companies.
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