Which MGT-7 should be filed by Small Companies

Short Summary

Ministry of Corporate Affairs (MCA) by an amendment in Rule 11 of Companies (Management and Administration) Amendment Rules, 2021 has introduced e-form MGT-7A as an annual return of Small Companies and OPC w.e.f. Financial Year 2020-21 onwards. MGT-7A is available on the MCA Portal since 17th July 2021.

In this editorial author shall discuss the questions arising in mind of professionals/ corporates i.e. If Any Small Company or OPC wants to file Annual Return for ended before 31.03.2021 (eg. FY 2019-20, 2018-19, or any previous financial year). Then such Company needs to file MGT-7 or MGT-7A for such previous years?

A. Provisions

Extract of Rule -11

Every company shall file its annual return in Form No.MGT-7 except

• One Person Company (OPC) and
• Small Company.

One Person Company and Small Company shall file annual return from the financial year 2020-2021 onwards in Form No. MGT-7A.

B. Interpretation of New Provisions

As per Rule 11 (extract given above) OPC and Small Company shall file MGT-7A for FY 2020-21 and onwards. After reading this one can opine that MGT-7 is applicable from 2020-21 and onwards.

C. Practical Difficulty

As form MGT-7A launched on 17th July 2021 and on same date MCA has launched updated version of MGT-7.

After Updation in MGT-7 w.e.f. 17th July 2021 it is not even accepting CIN of Small Companies and OPC and showing following error.

According to this Error MGT-7 shall not accept CIN of Small Companies and OPC w.e.f. 17th July 2021.

D. Conclusion

After reading the provisions and practical aspect one can opine that as on date if a Small Company or OPC wants to file their Annual Return for FY before 2020-21 i.e. 2019-20, 2018-19 or earlier financial years, then such companies have to file such Annual Returns in form MGT-7A instead of form MGT-7.