A Company Secretary (CS) is a vital managerial professional responsible for ensuring a company's compliance with statutory and regulatory requirements. In India, CS consultation services are essential for corporate governance, legal advisory, and compliance management. As defined under the Companies Act, 2013, a Company Secretary is entrusted with overseeing regulatory and secretarial compliances within the organization.
Who is a Company Secretary (CS)?
A Company Secretary (CS) is a key executive within a company, responsible for ensuring compliance with legal and regulatory standards. As an expert in corporate governance, the Company Secretary plays a vital role in guiding the company’s leadership to operate within legal frameworks, thereby protecting the company’s integrity and reputation.
He is also defined as Key managerial person in a company as per the companies act 2013.
Their core responsibilities include:
Advising the Board of Directors: The Company Secretary provides critical advice to board members, ensuring they understand and adhere to their legal responsibilities and regulatory requirements.
Maintaining Corporate Compliance: This includes ensuring that the company’s constitution, by laws, and other corporate documents are updated and aligned with current laws and regulations.
Organizing Meetings: The Company Secretary arranges and facilitates board meetings and general shareholder meetings, ensuring proper documentation and adherence to protocols.
Filing Statutory Documents: They oversee the timely submission of annual returns and other mandatory filings with the Registrar of Companies, ensuring compliance.
Keeping Corporate Records: This role involves managing and updating essential company records, such as registers of directors, shareholders, and other critical documents.
By fulfilling these responsibilities, the Company Secretary supports the company’s accountability, legal standing, and operational efficiency.
How CorpZo's CS Helps?
A Company Secretary plays a crucial role in helping clients by offering specialized guidance and solutions tailored to their business needs. Here’s how a Corpzo’s CS assists clients:
- Ensuring Compliance: Keeps the company updated with the latest regulatory changes and ensures compliance to avoid penalties.
- Advisory & Strategy: Offers expert advice on corporate restructuring, governance policies, and business expansion.
- Documentation & Filings: Drafts and reviews corporate documents, such as the company's constitution, shareholder agreements, and board resolutions.
- Regulatory Filings: Files the company's annual returns and other statutory documents with the Registrar of Companies.
When do you need a Company Secretary?
As per Section 203, read with Rules 8 and 8A of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014,
- Every listed company,
- Every public company with a paid-up share capital of ₹10 crore or more must appoint whole-time key managerial personnel.
- Additionally, as per Rule 8A, every private company with a paid-up share capital of ₹10 crore or more is required to appoint a whole-time Company Secretary.
Here are some key situations where appointing a Company Secretary can be beneficial:
- When establishing a new business
- When restructuring the company, such as through mergers or demergers
- When seeking investment from external investors
- When expanding into new markets
- When undergoing regulatory scrutiny
Key Requirement of Company secretary: -
Secretarial Audit: -
As per Section 204, read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Secretarial Audit is mandatory for:
a) Every listed company;
b) Every public company with a paid-up share capital of ₹50 crore or more;
c) Every public company with a turnover of ₹250 crore or more;
d) Every company with outstanding loans or borrowings of ₹100 crore or more from banks or public financial institutions.
The Secretarial Audit report must be filed in Form No. MR-3, as prescribed under the Act.
- Annual Return: -
The annual return, filed by a listed company or a company having paid-up share capital of ten crore rupees or more or turnover of fifty crore rupees or more, shall be certified by a Company Secretary in practice and the certificate shall be in Form No. MGT.8.
Every company shall file its annual return in Form No.MGT-7 except One Person Company (OPC) and Small Company.
- FEMA – CS Certificate as per format given in the RBI user manual stating that all requirements have been complied with.
Consequences for not appointing CS
- Non-Appointment of a Whole-Time Company Secretary
If a company required to appoint a whole-time Company Secretary fails to do so within the stipulated time, it will be subject to penalties under the Companies Act, 2013. The company shall be liable to a fine of not less than ₹1 lakh, which may extend up to ₹5 lakh.
- Fails to File Secretarial Audit Report:
If company fails to filed the requirement as prescribed under section 204, it will be subject to penalties under the Companies Act, 2013. The company shall be liable to a fine of not less than ₹1 lakh, which may extend up to ₹5 lakh.
- Non-Complied filing of annual returns:
If a company fails to file its annual return under sub-section (4), before the expiry of the period specified, the company shall be punishable with fine which shall not be less than fifty thousand rupees but which may extend to five lakhs rupees.
Importance of Company Secretarial Consultation
Company secretarial consultation is essential for ensuring a company’s smooth operation and compliance with legal and regulatory requireme7nts. Here’s why it is important:
- Legal Compliance: Company secretarial services help businesses adhere to all relevant laws, regulations, and statutory requirements. They ensure accurate record-keeping, timely filing of documents with government authorities, and compliance with legal obligations.
- Corporate Governance: A company secretary plays a key role in upholding corporate governance by facilitating communication between the board of directors, shareholders, and other stakeholders. This promotes transparency, accountability, and ethical decision-making.
- Shareholder Relations: Managing shareholder interactions is another critical function. Company secretaries organize shareholder meetings, prepare agendas and minutes, and ensure shareholders' rights are upheld.
- Board Support: They assist the board of directors by coordinating meetings, distributing relevant materials, and ensuring that board decisions are properly recorded and implemented.
- Records Maintenance: Accurate and well-maintained company records, such as financial statements and shareholder registers, enhance transparency and simplify audits and regulatory inspections.
Company Secretary consultation services in India play a vital role in ensuring corporate compliance, governance, and regulatory adherence. Businesses seeking to operate smoothly and legally must leverage the expertise of CS professionals to navigate the complex legal environment effectively. By choosing the right CS consultation service, businesses can mitigate risks, improve efficiency, and maintain corporate integrity.
