BEN 2: Applicability and Understanding

Declaration of significant beneficial ownership under Section 90 and Rule 4 of the Companies (Significant Beneficial Owners) Rules 2018:

About BEN

1. Main purpose of this Form is to identify the real owner of the Company.
2. Form BEN-2 need not to be filed if there is only direct holding of owners in the Company.
3. Once we File Form BEN-2, SBO (Significant Beneficial Owner) ID will be generated by MCA System.

Applicability: Applicable to all Companies in which there are SBOs.

Forms:

Form BEN-1: Declaration by the beneficial owner to the company. One time filing: within 90 days from the date of notification i.e. till 08/05/2019 by every individual who is a significant beneficial owner in that company

Regular filing: within 30 days on becoming significant beneficial owner in that company

Form BEN-2: Return to the Registrar by company in respect of declaration received in form BEN-1

Timeline: within 30 days from receipt of BEN-1 by the Company (for one time or regular filing)

Form BEN-3: Register of beneficial owners holding significant beneficial interest.

Form BEN-4: Notice to member seeking information in accordance with section 90.

Definitions:

Significant beneficial owner:

means an individual referred to in subsection (1) of section 90, who acting alone or together, or through one or more persons or trust, possesses one or more of the following rights or entitlements in such reporting company, namely:-

(i) holds indirectly, or together with any direct holdings, not less than ten per cent. of the shares;

(ii) holds indirectly, or together with any direct holdings, not less than ten per cent.of the voting rights in the shares;

(iii) has right to receive or participate in not less than ten per cent.of the total distributable dividend, or any other distribution, in a financial year through indirect holdings alone, or together with any direct holdings;

(iv) has right to exercise, or actually exercises, significant influence or control, in any manner other than through direct holdings alone.

Significant (Indirect) Control:Control by owners through one or more layers of companies in Reporting Company.

Significant (Indirect) Influence:Owner has influence in those entities, which influence Reporting Company.

Non-Applicability:

• the authority constituted under sub-section (5) of section 125 of the Act (i.e. authority under Investor Education and Protection Fund);
• Its holding reporting company, Provided that the details of such holding reporting company shall be reported in Form No. BEN-2.
• the Central Government, State Government or any local Authority;
• a reporting company, or a body corporate, or an entity, controlled by the Central Government or by any State Government or Governments, or partly by the Central Government and partly by one or more State Governments;
• Securities and Exchange Board of India registered Investment Vehicles such as mutual funds, alternative investment funds (AIF), Real Estate Investment Trusts (REITs), Infrastructure Investment Trust (InVITs) regulated by the Securities and Exchange Board of India;
• Investment Vehicles regulated by Reserve Bank of India, or Insurance Regulatory and Development Authority of India, or Pension Fund Regulatory and Development Authority.

Application to NCLT:

Reporting Company is obligated to file an application to the National Company Law Tribunal (NCLT) to impose restriction on the shares/dividend/voting rights if a person doesn't provide the required information to the company.

Penalty: In case of Non Compliance of this provision, the Company and every officer who is in default shall be punishable under Section 89, 90 and 447 of the Companies Act, 2013.

Details Required for Form BEN-2

Details of Significant Beneficial Owners (SBOs')

• No. of members (Individual/Company/HUF/LLP/P'ship firm/Trust/Body Corporate) holding Indirect as well as Direct holding in company including joint holding
• Name, address, PAN No., Passport No., E-mail ID of members. (CIN/LLPIN in case of member is a Company/LLP)
• Date of acquiring Significant Beneficial Ownership by member in Company
• Date of entry of name of member in register of Company

Details of holding company having SBOs' and details of its SBOs'.

Declaration in BEN-1 from SBOs' and date of receipt of declaration by Company

Form No. BEN-1

Declaration by the beneficial owner who holds or acquires significant beneficial ownership in shares

[Pursuant to section 90(1) of the Companies Act, 2013 and rule 2A, 3]

To
Name of the company:
Registered office address:

1. Purpose of filing the form (choose any one)

- For declaration of Significant Beneficial Ownership under Section 90
- For Change in Significant Beneficial Ownership under Section 90
- ID of the Significant Beneficial Owner

2. Particulars of the holder of the significant beneficial interest:

3A. Nature of indirect holding or exercise of right in the reporting company through member of the reporting company

(where more than one repeat this para of the Form)

(a) Type of Member (Company/ LLP/Any other Body Corporate/HUF/ Partnership Firm/Discretionary Trust/Charitable trust/Specific Trust/Revocable Trust /Pooled Investment vehicle (PIV) / Entity controlled by PIV)

(b) Corporate Identity number(CIN) or Limited Liability Partnership Identification number(LLPIN) or any other registration number allotted by the regulator established under the Act

(c) Name of the Member:

(d) Address

Line I:
Line II:
City: State:
Country: Pin Code:

(e) Nature of indirect holding or exercise of right in the reporting company:

• By virtue of shares: %
• By virtue of voting rights in shares: %
• By virtue of rights on distributable dividend or any other distribution: %
• By virtue of exercise of control (attach copy of agreement)
• By virtue of exercise of significant influence (attach copy of agreement)

(f) Status of significant beneficial owner in the member of the reporting company (choose any one)

• Individual in case of company or any other body corporate
• Partner in case of partnership firm or LLP
• Karta in case of HUF
• Trustee in case of a discretionary trust or charitable trust
• Beneficiary in case of a specific trust
• Author or settlor in case of a revocable trust
• General Partner, Investment Manager or CEO in case of pooled investment vehicle or entity controlled by pooled investment vehicle

(g) In case the member is a partnership firm or LLP, specify whether significant beneficial owner:

• is a partner
• holds majority stake in the body corporate partner
• holds majority stake in the ultimate holding company of the body corporate partner

(h) In case the member is a company or any other body corporate, specify whether significant beneficial owner holds:

• majority stake in such company or body corporate
• majority stake in the ultimate holding company of such company or body corporate

(i) Whether Significant Beneficial Owner has any direct holding or right in the reporting company:
Yes / No

If yes, enter details below:

• By virtue of shares %
• By virtue of voting rights in shares %
• By virtue of rights on distributable dividend or any other distribution %
• By virtue of exercise of control (attach copy of agreement)
• By virtue of exercise of significant influence (attach copy of agreement)

Date:
Place:
Signature of the holder of the significant beneficial interest:

Attachments:

Form no. BEN-3

Register of beneficial owners holding significant beneficial interest
[Pursuant to section 90(2) of the Companies Act, 2013 and rule 5(1)]

Name of the company:

Registered office address:

Form no. BEN-4

[Pursuant to section 90(5) of the Companies Act, 2013, rule 2A, 6 and rule 7]
(Name of Company)

Date:
To:
(Name and address of significant beneficial owner)

Subject: Notice under sub-section (5) of Section 90 of the Companies Act, 2013 and rules made there under

The Company has reasonable cause to believe that* ,

- you are a significant beneficial owner of the company;
- have knowledge of the identity of significant beneficial owner/another person ......... likely to have such knowledge;
- being a member hold not less than 10% of the shares/voting rights/rights on dividend or any other distribution in the company
- have been a significant beneficial owner of the company during the three years immediately preceding the date of this notice, and in respect of the above significant beneficial ownership, the return prescribed under Section 90 of the Act has not been filed in compliance with the Act.

You are accordingly advised to give the following information within 30 days of the date of this notice in accordance with the section 90 of the Companies Act, 2013:

1. Name and Address of the Beneficial Owner
2. PAN of the B.O
3. Name of the person/entity/trust/body etc in whose name the shares/rights are registered/held
4. Date of acquiring beneficial interest
5. Documents, terms and conditions or any other particulars regarding the BO ownership
6. Reason for not filing declaration in Form No. BEN-1.
7. Any other information incidental to or relevant or in your possession or knowledge to enable the company to evaluate this matter.

Name & Signature:

(Person Authorized to issue Notice)

* A copy of Form No. BEN-1 is attached for compliance.

The abovementioned particulars should be submitted in writing to the registered address of the company not later than 30 days of the date of this notice failing which the company shall proceed in the matter without further notice as per the provisions of the Act.

* Delete whichever is not applicable.

Details required from your end: Declaration by beneficial owner in Form BEN-1 which is received by Company

Details which required for Form BEN-2

Details of Significant Beneficial Owners (SBOs')

• No. of members (Individual/Company/HUF/LLP/P'ship firm/Trust/Body Corporate) holding Indirect as well as Direct holding in company including joint holding
• Name, address, PAN No., Passport No., E-mail ID of members. (CIN/LLPIN in case of member is a Company/LLP)
• Date of acquiring Significant Beneficial Ownership by member in Company
• Date of entry of name of member in register of Company

Details of holding company having SBOs' and details of its SBOs'.

Declaration in BEN-1 from SBOs' and date of receipt of declaration by Company

Also Read:-

• Introduction to Significant Beneficial Ownership
• Interpretation of Significant Beneficial Ownership
• Illustrations for Understanding Significant Beneficial Ownership