Conducted transactions before filing INC 20A.

Under the Companies Act, 2013 (Section 10A), it is mandatory for every company incorporated with share capital to file Form INC-20A within 180 days of its incorporation.

Legal Position on Pre-INC-20A Transactions

Carrying out business transactions—such as sales, purchases, or borrowing funds—before filing and receiving approval for Form INC-20A is prohibited. According to the Act, a company cannot commence business or exercise borrowing powers until this declaration is filed. Transactions conducted before this approval are legally considered voidable and irregular.

Regarding Your Specific Situation

You mentioned that your company has already conducted transactions and the bank account balance includes funds beyond the initial share capital.

• "Reversing" Transactions: Simply "reversing" entries in your books does not retroactively change the fact that the company engaged in business activity without the required commencement of business certificate.

• Annual Filings (AOC-4 and MGT-7): If you attempt to file annual compliance forms like AOC-4 and MGT-7 without having filed INC-20A, you will likely face significant issues. The MCA system often restricts companies from filing other statutory forms if the commencement of business declaration is missing. Furthermore, reporting business activity in your annual filings when you have not legally "commenced" business creates a clear contradiction that can trigger scrutiny from the Registrar of Companies (ROC).

• Risk of Penalties: Non-compliance invites a penalty of ₹50,000 on the company and ₹1,000 per day on every officer in default (up to a maximum of ₹1,00,000). Additionally, the ROC has the power to strike off the company name from the register if they believe the company is not complying with these provisions.

Recommended Steps

1. Consult a Professional: Given that transactions have already occurred, you should immediately consult a practicing Chartered Accountant (CA) or Company Secretary (CS). They can help you assess the extent of the non-compliance and determine if any "condonation of delay" process is required.

2. File INC-20A Immediately: If the 180-day window has not yet passed, prioritize filing INC-20A instantly. If the window has passed, you will need professional guidance on the specific procedures for late filing, which may involve additional fees and potential penalty assessments.

3. Audit Your Books: Work with your professional advisor to ensure your bank statement and accounting records are structured correctly to support the INC-20A filing, as the MCA requires specific proof that subscripttion money has been received.

Summary: You cannot legally conduct business before filing INC-20A. Transactions made before this filing are non-compliant, and attempting to hide these in your annual filings (AOC-4/MGT-7) is risky and may lead to severe penalties or rejection of filings. Please consult a qualified professional immediately to rectify this status.