“Compliance is not a cost. It is an investment in trust, integrity, and long-term value.”, said Christine Lagarde, Economist & President, European Central Bank.

In order to ensure that your business remains sound and in compliance with the law, you must be aware of the different mandatory compliance requirements for a private limited company as listed by the corporate laws, such as the Companies Act, 2013.

List of Compliances for Private limited companies

Annual Compliance

1. Board Meetings: You must conduct a minimum of four board meetings in a financial year. Do not exceed 120 days between two board meetings.

2. Annual General Meeting (AGM): Conduct your AGM within six months of the end of the financial year.

3. Financial Statement Filing (AOC-4): File this within 30 days after your AGM.

4. Annual Return Filing (MGT-7): Ensure that you file your annual return within 60 days after the AGM.

5. Income Tax Return (ITR-6): File your ITR every year before the due date.

6. Auditor Appointment (ADT-1): Appoint your auditor within 30 days of incorporation or AGM.

7. Director KYC (DIR-3 KYC): Every director must undergo the annual KYC.

Event-Based Compliance

Whenever there is a change in your company, you have more work to do. Here’s what you should  look out for:

·       Change in Director (DIR-12)

·       Change in Registered Office (INC-22)

·       Increase in Authorized Capital (SH-7)

·       Share Allotment (PAS-3)

·       Transfer of Shares

·       Change in Company Name (INC-24)

·       Change in Object Clause

Other Mandatory Compliance

·       Statutory Registers: Maintain updated registers for your members, directors, and charges.

·       Accounting: Maintain proper books of accounts and get your statutory audit done.

·       Tax: If applicable to you, file GST returns (monthly/quarterly and annual), TDS returns (quarterly), and professional tax as per your state rules.

·       Other: File MSME forms, DPT-3 (return of deposits), and DIR-3 KYC if applicable to your company.

Post-Incorporation Compliance

After incorporating, here is what you need to do in the first year:

·       Open a bank account.

·       Issue share certificates within 60 days.

·       Appoint your first auditor.

·       File the commencement of business (INC-20A)

Key Advantages of Private Limited Company Compliance 

They are some Advantages of PLC compliance

1. Legal Protection: Timely compliance protects directors and companies from severe fines, notices, and disqualification as per the Companies Act of 2013.

Unfiled ROC documents may result in daily fines (₹100 per document) or even striking off the company as per Section 248.

2. Investor Confidence: Financial transparency and ROC document compliance instill confidence in investors, venture capitalists, and banks.

Compliance-friendly companies raise funds quickly and at better valuations.

3. Operational Efficiency: Timely compliance helps maintain accurate records, organized reporting, and efficient decision-making.

A compliant company avoids the last-minute rush during audits or due diligence.

4. Financial Health: Regular compliance enhances creditworthiness, enabling easy access to loans and credit facilities.

Banks and investors consider compliance an indicator of sound financial discipline.

5. Reputation Management: An “Active” status on the MCA website is an assurance of reliability.

Public display of compliance enhances long-term business reputation.

Compliances required for a Private Limited Company (Pvt. Ltd.) in India can be classified into two main types: Registrar-Related (ROC) Compliances and Non-Registrar Compliances. Knowing the difference between the two will help in making sure that all the legal, tax, and labor compliances are fulfilled correctly and on time.

1. Registrar-Related (ROC) Compliances

These are filings that are done directly with the Registrar of Companies (ROC) under the Companies Act, 2013, which is overseen by the Ministry of Corporate Affairs (MCA).

Annual Compliances:

Annual filings such as financial statements and annual returns.

Forms: AOC-4, MGT-7/MGT-7A, DIR-3 KYC, ADT-1.

Event-Based Compliances:

These are triggered by certain events in the company such as allotment of shares, change of directors, or change in the registered office.

Forms: PAS-3, DIR-12, INC-22, SH-7.

Purpose: To ensure that there is transparency, the company is in compliance with the Companies Act, 2013, and that the MCA status of the company is “Active.”

2. Non-Registrar Compliances

These are operational and legal compliances that are subject to other laws than the Companies Act. These compliances are aimed at ensuring that the company complies with tax, labor, and industry-related requirements.

Tax Compliances: Income Tax Return (ITR-6), TDS/TCS, Advance Tax.

Indirect Tax: Monthly or quarterly GST Returns (GSTR-1, GSTR-3B).

Labor Laws: Provident Fund (PF), Employees’ State Insurance (ESIC).

Professional Tax (PT): State-wise monthly or annual returns.

Industry-Specific Compliances: FSSAI, MSME, SEBI, or Environmental licenses based on the nature of the business

Step by Step Procedure PLC Compliance

 Step 1: First Board Meeting 

The first board meeting should take place within 30 days of the incorporation of the company. Each director should be informed about the meeting at least seven days in advance.

Step 2: Further Board Meetings 

There should be at least four board meetings in a year. No two board meetings should be held more than 120 days apart.

Step 3: Filing Directors’ Disclosure of Interest 

Each director has to file their disclosure of interest in Form MBP-1 at three critical stages: at the first board meeting as a director, at the first board meeting of each financial year, and whenever there is a change in their disclosure of interest. This includes relatives, their association with the company (as per RPT rules), and their association with other companies, firms, or bodies. The company maintains these documents.

Step 4: First Auditor

The board has to appoint the first auditor of the company within 30 days of its incorporation. This auditor holds the position until the end of the first annual general meeting (AGM). You don’t have to file Form ADT-1 for this purpose.

Step 5: Subsequent Auditor 

The first AGM sees the appointment of the auditor, who will hold the position till the end of the sixth AGM. The company is required to inform the Registrar of Companies (ROC) about the appointment through the submission of Form ADT-1 within 15 days of the appointment. Only the company can submit this form, and not the auditor.

Step 6: Annual General Meeting 

Conduct an annual general meeting (AGM) by September 30 every year. The meeting must take place during working hours (9 am to 6 pm) on a day that is not a public holiday. The meeting should take place at the company’s registered office or in the same area. A 21-day notice should be sent before the meeting.

Step 7: Filing Annual Return (Form MGT-7) 

Each private limited company is required to submit its annual return within 60 days of the AGM. The annual return will be for the period from April 1 to March 31.

Step 9: Filing Financial Statements (Form AOC-4) 

You need to file your balance sheet, profit and loss account, and director’s report in Form AOC-4 within 30 days of holding the AGM.

Step 9: Statutory Audit of Accounts 

At the end of every financial year, the company is required to have its accounts audited by a professional or chartered accountant. The auditor will provide an audit report and the audited financial statements, which will then be filed with the Registrar.

Required Documents of PLP Compliance 

1.     Directors Identity and Address Proof: Passport or PAN Card copy for Indian Nationals and apostille/notarized Passport copy for Foreign Nationals

2.     Directors DIN (Director Identification Number)

3.     PAN Card of the Company

4.     Subscription Details and Share Allotment Proof

5.     Memorandum of Association (MOA)

6.     Articles of Association (AOA)

7.     Digital Signature Certificate (DSC) of Directors

8.     Proof of Registered Office Address (Rent Agreement, No Objection Certificate from Landlord)

9.     Form MGT-7 (Annual Return) (within 60 days of holding the AGM)

10.  Form AOC-4 (Financial Statements) (within 30 days of holding the AGM) – includes Balance Sheet, Profit & Loss Account, and Director’s Report

11.  Changes in shareholding or capital structure

12.  Appointment or removal of directors or auditors

13.  Loans or advances given to other companies or directors

14.  Opening or closing of bank accounts or changes in signatories

15.  Income Tax Return Documents

16.  TDS/TCS Return filing documents

Private Limited Company Compliance is not only mandatory under the Companies Act, 2013, but it is also the foundation of a strong and disciplined business. By ensuring timely filings, maintaining accurate records, and adhering to regulatory requirements, you can ensure that your company is active, genuine, and investment-worthy.

At Tax Esquire, we understand that company compliance is not merely a formality but a way to safeguard your company’s reputation, avoid penalties, and create long-term business value. With our expertise, compliance management, and support, we can ensure that your business is stress-free and compliant.