Ad-Free CAclubindia and daily updates on your mobile. Subscribe Now!

Query regarding hire a practicing company secretary (pcs)

Nimita Jain (Company Secretary) (87 Points)

18 August 2016

Dear Experts I am working in a Pvt. Ltd. Company as a whlole time CS and there is two group companies. In one company we hire a practicing company secretary (paid up cap is 6 crores) but not in another company (paid up cap is 4 crores) My query is - Is it necessary to hire a PCS in this another company? I have gone through the Co. Act 2013 but in the act rules are ther regarding whole time CS. But no provisions are there for hire a PCS. Please guide me whether we hv to hire practicing company secretary in another group company also?? Thank you.

Reply
Follow
Share

6 Replies

(Guest)

Hi,

Section 203 of Companies Act 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, necessitated that every listed company and every other public company having paid-up share capital of Rs 10 crores or more to appoint the Company Secretary in whole-time employment. All Private companies and such public companies having Paid-up share capital lower than Rs 10 crores were not required to appoint a Company Secretary.

Hcen , It is not required to appoint PCS , you may hire company secretary for your compilance purpsoe on case to case basis.i.e as per your requirement.

1 Like

Upgrade to CAclubindia Pro. Subscribe Now!

Nimita Jain (Company Secretary) (87 Points)
Replied 18 August 2016

Thank you Sir but we are taking practicing company secretary services in both the companies thats why am asking that we should hire him in the another company or not compulsory??

Because in one company we already hired him and paying retainership fees to him. and i am asking only for the another group company.

(Guest)

According to me , your both the group company is not falling under the requirement of WCS , hence you can hire one PCS for all your company on retainership basis.

Nimita Jain (Company Secretary) (87 Points)
Replied 18 August 2016

No Sir my one Company (which has paid up cap. 6 crores) is falling under the requirement to appoint WCS. because as per recently notified Rule 8A of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a company other than a company which is required to appoint a whole time key managerial personnel and which is having paid up share capital of Rs. 5 Crores or more shall have a whole time Company Secretary.

By the way thank you so much for your quick reply.

(Guest)

Thanks ,

Rule 8 itself is debatable The word and is in between listed company and every other public company.

Upgrade to CAclubindia Pro. Subscribe Now!

Bharath (C.A,C.S) (3983 Points)
Replied 18 August 2016

Such provision was very much in debate as it limited the role of Company Secretary in companies having paid up share capital of less than Rs. 10 crores.

Therefore after much deliberation and representation MCA (Ministry of Corporate Affairs) vide the Notification No. G.S.R. 390(E) on 9th June 2014 in Official Gazette amended the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 regarding appointment of Company Secretary. As per the aforesaid notification now, companies having paidup capital of Rs 5 crores or more has to mandatorily have a Company Secretary in whole time employment.

So one of your company ( > 5 crore) falls under the mandatory appointment of CS but the other company is not. However there are some annual filings ( like mgt-4,aoc-4) which are applicable to all companies and hence most of the companies engage a PCS for the sake of convenience and ease of job. Even you can undergo a secretarial audit report voluntarily for the 4 crore company even though it is not mandatory. Hope my reply solves your query.

1 Like