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    Key Compliance Requirements for Section 8 Company in India

    Published Thu, 31 Dec 2020 | Updated Wed, 17 Mar 2021 Company Law

    A Section 8 Company is governed by the provisions of the Companies Act, 2013 read with the allied Rules. However, in addition to the compliances as required under Companies Act, 2013, such companies are also required to comply with taxation and labour laws. In this Article, we have detailed out such mandatory compliances as are applicable on a Section 8 Company:

     

    Key Points:

    A. Compliances Under Companies Act, 2013 read with allied Rules
    B. Compliances Under FEMA Regulations
    C. Compliances Under Goods and Services Tax (GST) Act, 2017
    D. Compliances Under Income Tax Act, 1961
    E. Compliances Under Labour Laws

    A. Compliances Under Companies Act, 2013 Read with Allied Rules

    S. No. Compliance Form Due-date Remarks
      Immediately after Incorporation

    1.

    Conducting Board Meeting (BM) - Within 30 days from incorporation -

    2.

    Disclosure of Interest to be received from Directors Form MBP-1 On or before the date of first Board Meeting To be placed before the Board at the first BM

    3.

    Notice of Disqualification of Director Form DIR-8 On or before the date of first Board Meeting To be placed before the Board at the first BM

    4.

    Verification of Registered Office e-Form INC-22 Within 30 days of incorporation It is required to be filed only when the Company has not provided details of its registered office at the time of incorporation

    5.

    Appointment of Statutory Auditors - First Statutory Auditors to be appointed at the Board Meeting within 30 days of incorporation
     
    First Statutory Auditors shall hold office till the conclusion of the first AGM of the company.
    No compliance filing with the Registrar of Companies
     

    6.

    Making bank account operational - Within 2 months of incorporation The company should make its bank account operational (opened at the time of incorporation) on priority and deposit the share subscription amount in the said account within a period of 2 months
     

    7.

    Allotment of Shares to the Subscribers of Memorandum of Association
    (applicable in case of Section 8 formed with share capital only)
     
    - Within 2 months from date of Incorporation
     
     
     
                     
    Allotment of shares to the subscribers can be done by passing of Board Resolution
    No filing with the Registrar of Companies is required in case of allotment of shares to the subscribers

    8.

    Issuance of Share Certificate(s) to the Subscribers of Memorandum
    of Association
    (applicable in case of Section 8 formed with share capital only)
    Form SH-1 Within 2 months from date of Incorporation Issuance of Share Certificates to the subscribers shall be done immediately after allotment of shares bypassing of Board Resolution

    9.

    Payment of stamp duty on Share Certificate
    (in accordance with Stamp Act of the respective state)
    - Within 30 days of allotment of shares To  be paid with the Collector of Stamp of the respective State where the registered office of the company is situated

    10.

    Declaration for Commencement of Business e-Form INC-20A Within 180 days of incorporation -
      Quarterly

    1.

    Conducting Board Meeting (BM)   Atleast one BM to be held within every six
    calendar months
    Minimum 2 BMs shall be conducted by the company in each year
      Annually

    1.

    Disclosure of Interest to be received from Directors Form MBP-1 On or before the date of first Board Meeting of the FY To be placed before the Board at the first BM of every FY

    2.

    Notice of Disqualification of Director Form DIR-8 On or before the date of the first Board Meeting of the FY To be placed before the Board at the first BM of every FY

    3.

    KYC of Directors e-Form DIR-3 KYC 30th September of immediate next financial year -

    4.

    Statutory Audit of Financial Statements - Before date of board meeting approving the Financial Statement  

    5.

    The holding of Annual General Meeting (AGM) - 1st AGM-Within 9 months from the closure of FY
    Subsequent AGM- within 6 months from the closure of FY
    -

    6.

    Filing of Financial Statements e-Form AOC-4 Within 30 days from the date of Annual General Meeting -

    7.

    Filing of Annual Return e-Form MGT-7 Within 60 days from the date of Annual General Meeting -
      Others

    1.

    Appointment of Statutory Auditors e-Form ADT-1 Subsequent Statutory Auditors to be appointed at the First Annual General Meeting to hold office for a period of five years Subsequent Statutory Auditors shall hold office from the conclusion of first AGM till the conclusion of 6th AGM. Filing of Form ADT-1 within 15 days from the conclusion of AGM

    2.

    Maintenance of Minutes Book   On regular basis. Minutes may be recorded within 30 days of the conclusion of every meeting in case
    of companies where the articles of association provide for confirmation
    of minutes by circulation
    The company shall maintain a separate Minutes Book for each Board and General Meeting

    a.

    Maintenance of Statutory Registers      

    b.

    Register of Members Form MGT-1 On regular basis  

    3.

    Register of Directors and KMPs and their shareholding The register shall contain particulars as provided in Section 170 read with allied Rules On regular basis  

    B. Compliances Under FEMA Regulations

    S. No. Compliance Form Due-date Remarks
      Immediately after Incorporation

    1.

    Reporting of issuance of shares to a Subscriber who is a Person Resident Outside India FC-GPR Within 30 days of allotment of shares To be filed on RBI SMF Portal
     
      Annually

    1.

    Annual Return on Foreign Liabilities and Assets - On or before 15th July of each year To be filed on RBI FLAIR System
     

    Note: The aforesaid compliances under FEMA regulations shall be applicable only upon a Section 8 company receiving any foreign direct investment.

    C. Compliances Under Goods and Services Tax (GST) Act, 2017


    S. No.
    Compliance Form Due-date Remarks
      Immediately after Incorporation

    1.

    GST Registration   Within 30 days of crossing the threshold limit Mandatory if annual turnover exceeds the specified limit.
    Currently, Rs 40 Lacs for businesses other than specified state and Rs 20 Lacs for service providers
      Monthly

    1.

    Reporting of Outward Supply (Turnover exceeding Rs. 1.50 Crore) GSTR-1 10th of the following month  

    2.

    Monthly summary of outwards supplies, tax credits, payment of tax, etc. GSTR-3B 20th of the following month  

    3.

    Return by an Input Service Distributor GSTR-6 13th of the following month  
      Quarterly

    1.

    Reporting of Outward Supply (Turnover upto Rs. 1.50 Crore) GSTR-1 Last day of the month following the quarter  

    2.

    Tax payment by taxpayer registered under the composition levy CMP-08
     
    18th of the month following the quarter
     
    CMP-08 is a statement cum challan having details of outward &  inward supplies including the taxes paid etc
      Annually

    1.

    Annual Return for a taxpayer registered under the composition levy GSTR-4 by 30th April of subsequent year
     
    Until FY 2018-19, the due date was 18th of the month after the end of the quarter.

    2.

    Annual Return for the normal taxpayer GSTR-9 by 31st December of subsequent year Optional for the registered person having turnover up to 2 Crore for FY 2017-18 and 2018-19

    3.

    Annual Return for a taxpayer registered under the composition levy anytime during the year GSTR-9A by 31st December of the subsequent year Filing for FY 2017-18 and 2018-19 is waived off.

    4.

    GST Audit by Chartered Accountant GSTR-9C by 31st December of the subsequent year Applicable if turnover exceeds Rs. 2 crores for given financial year.
    (Turnover limit is increased to Rs. 5 Crore for FY 2018-19)

    D. Compliances under Income Tax Act, 1961

    S. No. Compliance Form Due-date Remarks
      Monthly

    1.

    Monthly Deposit of TDS or TCS ITNS-281 7th of the following month
    (In case of March, 30th April)
     
      Quarterly

    1.

    Payment of advance tax ITNS-280 15th June (15% of Advance Tax), 15th September (45% of Advance Tax), 15 December (75% of Advance Tax) and 15th March (100% of Advance Tax)
    Note: Due date will be 31st March for assessee opting for presumptive taxation.
    Advance tax is required to be paid in case the estimated total tax liability is Rs. 10,000 or more
     

    2.

    Filing of TDS return 24Q (Salary)
    26Q (Other than salary)
    27Q (Non-resident Indian)
    by 30th/31st of the month following the quarter. By 31st May for quarter ending March.  

    3.

    Issuance of TDS Certificate Form 16 (Salary)
    Form 16A (other than Salary)
    by 15th of the month following the due date of filing of TDS return  

    4.

    Filing of TCS return 27EQ 15th of the month following the quarter  

    5.

    Issuance of TCS Certificate 27D by 15th of the month following the due date of filing of TCS return  

    6.

    Return by banking company/ public company/ co-operative society regarding non-deduction of tax at source 26QAA 31st of the month following the quarter  
      Annually

    1.

    Income Tax Return   By 30th September/ 30th November of the following year as applicable.
     
    From AY 2021-22
    By 31st October/30th November of following year, as applicable
    From AY 2021-22
    31st October: Assessee on whom Tax Audit is applicable, provided they have duly filed Tax Audit Report by 30th September
    30th November: Assessee who are required to furnish transfer pricing report, provided they have duly filed their Tax Audit Report and Transfer Pricing report by 31st October

    2.

    Tax Audit and filing of Tax Audit report   By 30th September/ 30th November of the following year as applicable.
     
    From AY 2021-22
    By 30th September (Non transfer pricing cases)


    By 31st October (transfer pricing cases)
     
    of following year, as applicable
    To be done by a chartered accountant in practice if gross receipts exceed the following limits:
    Rs. 1 Crore: in case of business
    Rs. 50 Lacs: In case of profession
    Rs. 5 Crore (applicable from AY 2021-22): For business whose aggregate of all receipts in cash does not exceed 5% of such receipts during the previous year and aggregate of all payments in cash does not exceed 5% of such payment during the previous year

    3.

    Preparation and filing of transfer pricing study and accountant certificate, if applicable   By 30th November of the following year.
     
    From AY 2021-22
    By 31st October of following year
     
      Others

    1.

    Furnishing of challan cum statement in respect of TDS under section 194-IA/IB 26QB/26QC Within 30 days from the end of the month in which the deduction is made  

    E. Compliances under Labour Laws

    S. No. Compliance Form Due-date Remarks
      Monthly

    1.

    Payment of Provident Fund (PF) contribution ECR 15th of the following month  

    2.

    Payment of Employees’ State Insurance (ESI) - 15th of the following month  
      Half yearly

    1.

    Return of Employees’ State Insurance (ESI)   11th May (for period October to march) and 11th November (for period April to September)  
      Annually

    1.

    Labour Welfare Fund - Paid on annual basis as per the due date applicable in respective states  

    2.

    Filing of PF Return - 25th April subsequent to financial year  

     

    These are broad compliances which need to be ensured by any Section 8 Company registered in India irrespective of the fact whether it has been incorporated as a public or a private company. However, there may be some additional compliance required under different laws depending upon industry, nature of business and other factors. The list may not be exhaustive and subject to vary with various amendments in relevant laws, accordingly it is advisable to take professional opinion before acting upon the same.

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