Cs not appointed

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

12 March 2013 Hi,
My company is having an turnover of Rs. 100 crores, but have not appointed any CS, my company has received a show cause notice for the reason for not appointing CS till now.
And paid up capital is around 6 crores.

Please guide me what reasons can i give which can justify this.

CS Deepika

CS Deepika (Expert)

14 March 2013 on what date your paid up capital crossed the limit of 5 crore.

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)

20 July 2024 If your company has received a show cause notice for not appointing a Company Secretary (CS) despite having a turnover of Rs. 100 crores and a paid-up capital of around Rs. 6 crores, here are some reasons you could consider to justify this:

1. **Size and Scale of Operations**: Explain that the company's operations, though substantial in terms of turnover and capital, may not be complex enough to necessitate a full-time Company Secretary. If the operations are relatively straightforward and do not involve intricate legal or regulatory compliance issues, this could be a valid reason.

2. **Recent Incorporation or Change in Status**: If the company is relatively new or has recently crossed the turnover threshold, you could justify that the need for a Company Secretary is being evaluated and planned for in the near future.

3. **Consulting or Outsourcing Services**: Mention if the company is availing professional services from external consultants or firms specializing in company secretarial functions. This could include legal firms or consultants who are currently handling the company's compliance requirements.

4. **Board Composition and Expertise**: Highlight the composition of the board of directors and their collective expertise in handling governance and compliance matters. If the board includes members with extensive legal or corporate governance experience, this could mitigate the need for a dedicated Company Secretary.

5. **Steps Towards Compliance**: Outline any steps taken or planned towards compliance with the requirement. This could include discussions with potential candidates for the role, engagement with professional bodies for guidance, or plans to appoint a CS in the near future.

6. **Industry Practice**: Research and cite industry practices or norms regarding the appointment of Company Secretaries in companies of similar size and nature within your industry. If not having a CS is common or accepted practice, this could strengthen your justification.

It's essential to be transparent and proactive in responding to the show cause notice. Provide supporting documentation and evidence where possible to substantiate your reasons. If needed, seek advice from legal or compliance experts to ensure your response is comprehensive and addresses all concerns raised by the notice.

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