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Company KYC: The Companies (Incorporation) Rules, 2014

March 6, 2019 July 09, 2016 Admin

The Ministry of Corporate Affairs has come up with the KYC of the registered office of the Companies wherein Rule 25A has been inserted in the Companies (Incorporation) Rules, 2014 that shall come into force w.e.f. 25th February 2019 vide notification dated February 21, 2019.

Rule 25A: Every company incorporated on or before December 31, 2017, shall file the particulars of the company and its registered office, in e-Form INC-22A [ACTIVE (Active Company Tagging Identities and Verification)] on or before April 25, 2019.

Why such a requirement came up?

  • There are many shell companies which are created either to evade taxes or with malafide intention.
  • During demonetization, there are many inactive companies which have deposited heavy cash into their bank account. Such companies’ balance sheet, annual returns or other details are not available.
  • There are many companies which registered office is either not traceable or having an incorrect address.

To solve all the above issues, Govt. has come up with one-time compliance to ensure that the company is active with its registered office. Govt. has also empowered ROC to physically verify the registered office if they thought. So, by requiring photos, Govt. want data bank of photos of registered office which can be used in the future, if required.

Particulars and documents required to be filled in the ACTIVE form:

  • Name, Address and Email Id of Company; [Email Id to be verified through One Time Password (OTP)]
  • Latitude and Longitude of the registered office of the Company;
  • Details of Directors, CS, and KMP of Company, Their PAN and Membership Number;
  • If CS or KMP is not appointed, then this form will not proceed further and Company has to comply with respective provisions before the filing of this form.
  • All Directors DIN must be active.
  • Details of Statutory Auditor and Cost Auditor;
  • SRN of last year annual filing forms i.e AOC-4 and MGT-7;
  • 2 Photographs of registered office one showing external building and other inside office showing at least 1 Director/KMP who has affixed his/her signature on this form;
  • Photographs must be in PDF format as only PDF attachments are allowed currently.
  • The form must be certified by 1 Director and 1 KMP or 2 Directors in case KMP provisions are not applicable.

Professional Certification:

This form needs to be certified by a Practicing CS/CA/CMA. Professional need to certify about the correctness of Email Id, Registered office photos, Directors DIN status, CS and KMP appointment provisions etc.

Fees:

Upto April 25, 2019 – Nil, After April 25, 2019 – Rs. 10,000/-

Which Company will be unable to file this form?

  • Companies which has not filed its financial statements i.e AOC-4 or annual returns i.e MGT-7
  • Companies which has not appointed CS, KMP or appointed but not filled the form with ROC.

Exemption from the filing:

Companies which have been struck off or are under the process of striking off or under liquidation or amalgamated or dissolved as recorded in the register, shall not be required to file e-Form ACTIVE.

Effect of Non-Compliance:

In case a company does not file this form, the Company shall be marked as “ACTIVE-non-compliant” on or after April 26, 2019, and shall be liable for action under section 12(9) i.e Registrar may without prejudice to the provisions of section 12(8), initiate action for the removal of the name of the company from the register of companies under Chapter XVIII.

The following event-based information or changes shall be not be accepted by the Registrar from such non-compliant companies –

  • SH-07 (Change in Authorized Capital);
  • PAS-03 (Change in Paid-up Capital);
  • DIR-12 (Changes in Director except for cessation);
  • INC-22 (Change in Registered Office); and
  • INC-28 (Amalgamation, de-merger).
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