Failure in compliance u/s 192 - Pvt.Co., Companies Act, 1956

Resolutions 1714 views 2 replies

Rajesh Sheth

Chief Financial Officer

27 Points Joined July 2008

Dear Friends,

I have a few queries as follows, pertaining to Companies Act, 1956 (Pvt. Co.).

Case-1

The Company has already borrowed loan from the bank and has citing reference of the Members’ Special Resolution (SR) passed u/s 293(1)(d). However, the Company has failed in registering the SR with the RoC within 30 days.

Case-2

The Company has already obtained Pvt. Equity Funding and now needs to issue Equity Shares beyond the registered Authorised Capital. The Company had entered into the necessary agreement with the PE Fund citing reference of the Members’ Special Resolution (SR) passed increasing the Authorised Capital and thereby altering the MoAoA, However, the Company failed in registering the SR with the RoC within 30 days.

Queries:

1. Does this make the transactions (bank borrowing / PE funding) null & void?

2. Can this be cured by late filing it with applicable penalty?

3. Will it require any special petition/application to Reg.Dir./Central Govt./CLB?

4. If 2 &/or 3 are possible, what will be the process, approximate time & expenses involved (Fees, Penalties, etc.)?

5. Otherwise, what’s the solution?

Can some one please advise?

Thanks.

Replies (2)

Swati P

Chartered Accountant

173 Points Joined October 2007

1. For Case 1 -Its better to file Special Resolution first with ROC,

2. As you said Co wishes to Issue shares beyond Authorised Share Cap, which is absolutely wrong, If special resolution is passed already file Eform 5 & 2 with ROC to increase authorised cap & Paid up Cap subsequently

3. Filing SR late wid ROC will Attract Penalty obviously & so will late filing of Form 2 & 5 attract.

Website has E-forms download option which helps u to download a zip folder which contains clear instructions & also instuctions as various relevant attachments to be filed therewith.

Because exact dates r not mentioned in your query I suggest you to use FEES Calculator option on MCA website.

Rajesh Sheth

Chief Financial Officer

27 Points Joined July 2008

Dear Ms.Swati,

Thanks for your prompt reply. If you are right & if I've undrstood correctly, the defects are entirely curable by late filings with appropriate penalties and the same do not require any special petitions to RD/CG/CLB.

You/others may need to reply only if my understanding is wrong.

Thanks once again.