Blog

2019

Voluntary Liquidation of a Private Limited Company

Introduction:

Company is a form of business which comes with many compliance requirements. Unlike other forms of business like Proprietorship or Partnership Firm which have very less compliance burden, companies have to comply with lot more regulations. Introduction of Companies Act, 2013 has also increase this compliance burden.

This entails an increasing cost in the form of Government fees, late payment interest & penalty etc. The businessmen have to hire consultants to manage these requirements which in turn further increase their cost.

In the face of global economic slowdown, if the business is not performing well, this additional compliance would only increase losses of the business instead of adding any value. Hence, many small companies prefer to switch to other forms of business like Partnership Firm. In this article we will discuss the process of closing down a Pvt. Ltd. company.

Archive


2019

Compliance Related to Records Keeping under the Companies Act 2013

  • The Companies Act, 2013 (the Act) and the rules made there under lays down that every Company incorporated under the Act has to maintain Statutory Registers (the Registers) and Records.
  • The Registers need to maintained and updated eventually and should be kept at the Registered Office of the Company.
  • Some of the Registers are required to be kept open for inspection by Directors, Members, Creditors and by other persons.
  • A Company is required to provide the extracts from the Registers, if demanded by Directors, Members, and Creditors and by other persons on payment of specified fees.

2018

Financial Reporting Requirementsfor Companies 1

Every company registered under Companies Act, 2013 has to comply with all the provisions of the Companies Act. The act provides detailed instructions related to preparation of financial statement prepared by companies.

2016

6 changes you must know for registration of company’s name under new Rules [MCA Notification dated 22/01/2016]

  • The Govt. has notified the Companies (Incorporation) Amendment Rules, 2016 (‘Amended Incorporation Rules’). Now the process of reservation of name of companies has been simplified. Following changes have been made for ease of doing business in India:
    1. Name of company need not to be in consonance with principal object : Under extant norms, the company’s name was necessarily required to be in consonance with principal object, if such name resembled any object of company. Now as per the amended Rules the name of company will not be considered undesirable even if it is not in consonance with the principal objects of the company as set out in Memorandum of association. Let us understand this condition with the help of an example. Suppose if a company wants to opt its name as ‘ABC Builders Pvt. Ltd.’ then it is not necessary that its principal object should be related to construction and development only. Thus, now company is free to choose such name which is not in consonance with principal object.

2015

Here is a list of important points to remember while calculating Depreciation as per Companies Act, 2013:

  1. Schedule II of the Companies Act, 2013 for calculating depreciation is applicable only on tangible assets. For calculating amortisation on intangible assets, the companies have to follow the applicable accounting standard, AS 26.
  2. Depreciation as per Companies Act, 2013 depends on the useful life of various assets as defined in the Schedule II to the Companies Act, 2013.
  3. Rates of depreciation are derived from the useful life of assets. No separate rates of depreciation are defined in the Act.
  4. 5% is the residual value of assets prescribed as per schedule II of the Companies Act, 2013. Accordingly, 95% of the original cost of the asset only has to be depreciated.
2014

Analysis of Definition of Dormant Company:

Dormant Company means a company –
  • If a company is formed and registered under the Act for a future project and has no significant accounting transaction, or
  • If a company is formed and registered under the Act to hold assets and has no significant accounting transaction, or
  • If a company is formed and registered under the Act for Intellectual property and has no significant accounting transaction such a company, or
  • An Inactive company may make an application in such manner as may be prescribed for obtaining the status of dormant company.

Financial Management