Dear Collegues,
Can Second or subsequent financial year be more than 12 months upto 15 months as per Section 210(4) of the Companies Act?
As Section 210(4) says that period to which accounts relates is reffered as Financial year and it may be less or more than a calender year, but it shall not exceed 15 months. It does not specify that it is applicable for the first year. i.e for year of incorporation. The text of Setion 210 is as follow:
Section 210
ANNUAL ACCOUNTS AND BALANCE SHEET.
(1) At every annual general meeting of a company held in pursuance of section 166, the Board of
directors of the company shall lay before the company -
(a) a balance sheet as at the end of the period specified in sub-section (3); and
(b) a profit and loss account for that period.
(2) In the case of a company not carrying on business for profit an income and expenditure
account shall be laid before the company at its annual general meeting instead of a profit and
loss account, and all references to "profit and loss account", "profit" and "loss" in this section and
elsewhere in this Act, shall be construed, in relation to such a company, as references
respectively to the "income and expenditure account", "the excess of income over expenditure",
and "the excess of expenditure over income".
(3) The profit and loss account shall relate -
(a) in the case of the first annual general meeting of the company, to the period beginning with
the incorporation of the company and ending with a day which shall not precede the day of the
meeting by more than nine months; and
(b) in the case of any subsequent annual general meting of the company, to the period beginning
with the day immediately after the period for which the account was last submitted and ending
with a day which shall not precede the day of the meeting by more than six months, or in cases
were an extension of time has been granted for holding the meeting under the second proviso to
sub-section (1) of section 166, by more than six months and the extension so granted.
(4) The period to which the account aforesaid relates is referred to in this Act as a "financial year";
and it may be less or more than a calendar year, but it shall not exceed fifteen months :
Provided that it may extend to eighteen months where special permission has been granted in
that behalf by the Registrar.
Regards,
CS Samiksha Kansara
CAclubindia
