GST Certification Course

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Question 1(a)

Explain the law laid down under the Companies Act, 2013 in respect of filing of annual financial statements with Registrar of companies. In the following two situations who is liable for the default.

i. Where financial statements of the company are filed with the ROC after 10 months from its due date;
ii. Where financial statements are not at all filed by the company with the ROC? (4 Marks)

Answer 1(a)

As per Section 137 of Companies Act, 2013 every company is required to file financial statements with Registrar within 30 days from the date of Annual General Meeting. If financial statements are not filed within 30 days, filing may be done within 300 days with additional filing fees. If company fails to file even within 300 days with additional fees, following penal consequences take place:

a. Company is punishable with fine of Rs. 1000 per day for every day during which the default continues, but shall not me more than Rs. 10 lacs; and

b. Managing Director or Chief Financial Officer is punishable with imprisonment, which may extend to 6 months or with fine of not less than Rs. 1 lac but which extend to Rs. 5 lacs.

If the company has neither Managing Director nor Chief Financial Officer, all directors are responsible.

Question 1(b)

A group of creditors of Mac Trading Limited makes a complaint to the Registrar of Companies, Hyderabad alleging that the management of the company is indulging in destruction and falsification of the accounting records of the company. The complainants request the Registrar to take immediate steps to seize the records of the company so that the management may not be allowed to tamper with the records. The complaint was received at 10 A.M. on 1st July 2015 and the ROC entered the premises at 10.30 A.M. for the search. Examine the powers of the Registrar to seize the books of the company. (4 Marks)

Answer 1(b) 

Registrar cannot seize the books of company without permission of Special Court. Refer answer of question no. 2 of Chapter no. 3 – Inspection and Investigation of book Corporate & Allied Laws – 3rd edition published by Taxmann

Question 1(c)

Indian Software Ltd. seeks to export software to its client in Indonesia. In this regard - 

i. Explain the procedure to be adopted for export of software under the Foreign Exchange Management Act, 1999 and state the period within which value is to be realised.

ii. Explain the position in case of delay in receipt of payment from its client. (4 Marks)

Answer 1(c)

(i) Every exporter is required to submit declaration within 21 days of export. Export declaration should be submitted in either form EDF or form SOFTEX. Declaration should be supported by evidence regarding particulars about material. It should disclose amount representing the full export value of the goods or services. IEC Number (importer-exporter code number) is indicated on all copies of the declaration forms submitted by the exporter to the specified authority. Export proceeds should be realised and repatriated to India within 9 months from date of export. On realization of the export proceeds, the authorised dealer shall, after due certification, submit the duplicate of the form EDF or SOFTEX form to RBI.

(ii) If there is delay of more than 9 months in receipt of export value, exporter should make an application before expiry of realisation period to RBI or Authorised Dealer. RBI or Authorised Dealer may allow extension in time limit for receipt of export value for sufficient reason. For details theory, refer paragraph no. 14 of Chapter no. 3 – FEMA of book corporate & Allied Laws – 3rd edition published by Taxmann.

Expert Comment

Most of the students who were not updated wrote period of 12 months. In fact RBI vide circular has reduced time from 12 months to 9 months for export proceed realisation. Majority of the tudents who read old book and handbook were not in position to answer correctly.

Question 1(d)

Explain the functioning of the two types of Front Office (FO) in accessing MCA 21 portal of the Ministry of Corporate Affairs. Also, state the nature of services, which can be availed of by its user on the MCA 21 portal. (4 Marks)

Answer 1(d)

The front office represents the interface of the corporate and public user with the MCA 21 system. It includes:

i. Virtual front office (VFO)
ii. Physical front office (PFO)

The VFO is what the citizen has in front while accessing the MCA 21 portal. The PFO will be a replacement to the existing ROC counters. The PFO will also accept paper documents. However, customer service agents at PFO will convert these into electronic documents. In addition, the authorised person(s) will have to sign these documents digitally. Consequently, the authorised signatories for a given document will need to appear in person at the PFO for digitally signing the document.

Following services are available to various users on MCA portal:

• E-filing of documents
• View and inspection of filed documents
• Request and obtain certified copies of document
• Registering investor complaints
• Tracking transaction status
• Find CIN
• Fee calculator
• Checking company name
• View transaction details
• Certified filing centres
• Downloading pre-requisite software for e-filing

Question 1(e)

XYZ, a recognized stock exchange fails to comply with certain directions issued by the Securities and Exchange Board of India and the adjudicating officer initiated proceedings for the purpose of imposing penalty. The stock exchange seeks your advice whether it is possible to go for settlement of the proceedings. Advise explaining the relevant provisions of the Securities Contracts (Regulation) Act, 1956? (4 Marks)

Answer 1(e)

Yes. It is possible for XYZ Ltd. stock exchange to go for settlement of the proceedings.- Section 23JA. For details theory, refer paragraph no. 27 of Chapter no. 14 – Securities Contract (Regulation) Act, 1956 of book corporate & Allied Laws – 3rd edition published by Taxmann.

Expert Comment

Again, ICAI has asked something which is based on amendment. A provision was amended last year. Most of students who were not updated about it. Stay updated.

Click here to download the question paper on Corporate & Allied Laws (CA Final)
Click here to read the full article / download the solved paper in PDF form.
Click here to enrol Corporate & Allied Laws subject of the author.


Published by

Tejpal Sheth
(Practising company secretary-visiting fa)
Category Students   Report

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