MGT-4,5,6 applicability

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Manas (Querist)
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26 August 2024 Hi,

Is MGt-4,5,6 filining applicable to company formed through JV agreement where nominee shareholders are appointed and are holding shares on behalf of JV partner . Dividend is paid to paid to JV partners only.

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)
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12 August 2025 Great question — and yes, MGT-4, MGT-5, and MGT-6 can become applicable in your situation depending on how the nominee shareholding is structured. Let’s break it down:
✅ First, Understand the Forms:
Form Purpose
MGT-4 Declaration by the beneficial owner of shares (the JV partner)
MGT-5 Declaration by the registered owner (the nominee) holding shares on behalf of someone else
MGT-6 Filing by the company with the ROC when it receives MGT-4 and MGT-5
📌 Applicability in Your Case:
Company formed through JV agreement
Nominee shareholders hold shares on behalf of actual JV partners (beneficial owners)
Dividend paid to JV partners, not to nominees.
This clearly indicates that:
Nominee is only a legal holder, not the beneficial owner
JV partner is the actual beneficial owner
Therefore:
✅ Yes, MGT-4, 5, and 6 are applicable.
JV Partner (beneficial owner) must file MGT-4 with the company within 30 days of acquiring beneficial interest.
Nominee Shareholder (registered holder) must file MGT-5 with the company within 30 days of becoming such holder.
Company must file MGT-6 with ROC within 30 days of receiving both MGT-4 and MGT-5.
🚨 Key Legal Basis:
As per Section 89 of the Companies Act, 2013:
If shares are held by a person (nominee) on behalf of another person (beneficial owner), both must file declarations, and the company must file return with ROC.
Even if dividend is routed directly to the beneficial owner, this does not exempt the company or parties from filing MGT-4 to 6.
🔔 Penalty for Non-Compliance:
Failure to file any of these can attract penalties under Section 89:
₹50,000 for the company + ₹200 per day (max ₹5 lakh)
₹50,000 for the shareholder + ₹200/day (max ₹2 lakh)
✅ Summary:
Item Applicability in JV Co. with Nominees
MGT-4 (by JV partner) ✅ Yes — JV partner is beneficial owner
MGT-5 (by nominee) ✅ Yes — nominee is legal holder
MGT-6 (by company to ROC) ✅ Yes — mandatory after receiving MGT-4 & 5

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