Online Dispute Resolution (ODR): Meaning, Process, Advantages & Legal Framework
18 Apr, 2025
By Online Legal India
Published On 30 Dec 2020
Updated On 14 Apr 2025
Category Private Limited Company
Private Limited Companies are among the most popular business structures in India due to advantages like limited liability, a separate legal identity, and ease of raising funds. However, these benefits also come with responsibilities—especially in terms of statutory compliance. Timely adherence to compliance requirements not only protects your business from penalties but also helps build credibility and trust with government authorities.
In this blog, you will learn about the annual compliance requirements for a Private Limited Company in India.
Annual compliance refers to the set of legal obligations that a company must fulfill every financial year to remain in good standing with regulatory authorities. These obligations are mainly designed to ensure transparency, accountability, and adherence to applicable laws. It includes the Companies Act, 2013, the Income Tax Act, 1961, and various other corporate, taxation, and industry-specific laws.
In India, all registered businesses like private limited companies, public limited companies, one-person companies (OPCs), and other registered entities must follow yearly filing rules. These include submitting documents to the Ministry of Corporate Affairs (MCA) and filing tax-related forms with the Income Tax Department to stay legally compliant and avoid penalties.
Private Limited Companies registered under the Companies Act, 2013 are obligated to follow certain annual compliance requirements to ensure transparency, accountability, and adherence to statutory norms.
Here is a detailed breakdown of the significant annual compliances for Private Limited Companies:
Every Private Limited Company must hold at least four board meetings in a financial year. The gap between any two meetings should not exceed 120 days, as per Section 173 of the Companies Act, 2013. You must prepare a notice, agenda, attendance register, and minutes for each meeting. However, small companies are allowed to conduct just two board meetings per year.
Every company in India, except a One Person Company (OPC), must hold an Annual General Meeting (AGM). The first AGM should take place within 9 months after the end of the first financial year. From the next year onwards, companies must conduct the AGM within 6 months after the financial year ends, as per Section 96.
Every company is required to prepare its financial statements at the end of each financial year. These include the Balance Sheet, Profit & Loss Account, Cash Flow Statement, and Notes to Accounts, as mandated by Section 129 of the Companies Act, 2013.
Every company must appoint or reappoint a Chartered Accountant as its auditor for a 5-year term, as per Sections 139 and 143 of the Companies Act, 2013. The auditor checks the company’s financial records each year, and their report is submitted along with Form AOC-4.
All company should file its audited financial statements with the Registrar of Companies (RoC) by submitting Form AOC-4. This must be done within 30 days of holding the Annual General Meeting (AGM).
Penalties for Non-Filing of AOC-4:
A penalty of ?10,000, plus an additional ?100 per day of default, up to a maximum of ?2 lakhs.
A penalty of ?10,000, plus an additional ?100 per day of default, up to a maximum of ?50,000.
If no Managing Director/CFO or other assigned director is in default, all directors can be penalized with the same amount as the MD/CFO, up to ?50,000.
Every company is required to file its Annual Return with the Registrar of Companies (RoC) using Form MGT-7. This return contains information about the company’s directors and shareholders. This form must be filed within 60 days of the AGM. Small companies will be able to file a simpler version, Form MGT-7A.
The Director’s Report is a summary prepared by the company’s Board of Directors. It highlights the company’s financial performance, major decisions taken during the year, and any CSR activities, if applicable. This report is a mandatory attachment when filing Form AOC-4 with the Registrar of Companies.
Every director who has received a Director Identification Number (DIN) on or before March 31 of a financial year must file Form DIR-3 KYC. This must be done by 30th September of the next financial year. Failing to miss the deadline leads to a Rs. 5,000 penalty and DIN deactivation.
Every company, except government companies, must file Form DPT-3 to report any outstanding loans or money received that are not treated as deposits. This needs to be done by 30th June each year, as per Rule 16 of the Companies (Acceptance of Deposits) Rules, 2014.
If a company has unpaid dues to MSME (Micro, Small, and Medium Enterprises) vendors for more than 45 days, it must file Form MSME-1. For the April to September period, file by 31st October, for October to March, file by 30th April each year.
Every company must file its annual Income Tax Return (ITR) under the Income Tax Act, 1961. If the company is audited, the due date is 31st October. Use Form ITR-6, unless the company claims exemption under Section 11 of the Act.
Every private limited company must maintain certain important records which are known as statutory registers. These include registers of members, directors, charges, and details of loans, investments, and contracts. This is a legal requirement under Sections 88 and 189 of the Companies Act, 2013. It plays a crucial role in ensuring transparency and compliance.
Every director of a private limited company must declare their interest in other businesses or entities. This disclosure is made using Form MBP-1 during the first board meeting of the financial year, as per Section 184(1) of the Companies Act, 2013.
Here is the list of documents required for Private Limited Company Compliance. A Few are mentioned below:
Mandatory Documents for Annual Compliance:
As per Section 129 of the Companies Act, 2013, every company must prepare financial statements that give a true and fair view of the company's state of affairs.
Components:
Under Section 134 of the Companies Act, 2013, the Board of Directors must prepare a report detailing the company's performance and other prescribed matters.
Contents include:
As mandated by Section 143 of the Companies Act, 2013, the statutory auditor must provide a report on the financial statements, expressing an opinion on their accuracy and compliance.
Section 92 of the Companies Act, 2013 requires every company to file an annual return in Form MGT-7, containing particulars as they stood at the close of the financial year.
Key details:
In accordance with Section 137 of the Companies Act, 2013, companies are required to file their financial statements, including consolidated financial statements if any, along with all the documents that are required to be or attached to such financial statements, with the Registrar within 30 days of the date of the annual general meeting.
As per Rule 12A of the Companies (Appointment and Qualification of Directors) Rules, 2014, every individual who has been allotted a Director Identification Number (DIN) must submit Form DIR-3 KYC annually.
Required information:
Under the Income Tax Act, 1961, every company, other than companies claiming exemption under section 11, must file its income tax return in Form ITR-6.
Documents needed:
Here is the step-by-step process for annual compliance filing for a Private Limited Company:
As mandated by Section 129 of the Companies Act, 2013, every company must prepare financial statements that provide a true and fair view of its financial position. These statements should be in accordance with the accounting standards notified under Section 133 of the Act.
Key Components:
Under Section 143 of the Companies Act, 2013, the financial statements must be audited by a qualified Chartered Accountant. An auditor checks the company's accounts. They provide a report sharing their opinion on accuracy and compliance.
According to the Section 173 of the Companies Act, 2013, every company should hold a minimum of four Board Meetings each year, with a maximum gap of 120 days between two meetings. These meetings are essential for approving financial statements, discussing annual returns, and other compliance matters.
In accordance with Section 96 of the Companies Act, 2013, every company, other than a One Person Company, must hold an AGM each year. The AGM should be held within six months from the end of the financial year, but not later than 15 months from the previous AGM.
AGM Agenda Typically Includes:
Under Section 137 of the Companies Act, 2013, companies are required to file their financial statements with the Registrar of Companies (ROC) using Form AOC-4 within 30 days of the AGM. This includes the balance sheet, cash flow statement, notes to accounts, and profit and loss account.
According to Section 92 of the Companies Act, 2013, every company must file its annual return in Form MGT-7 within 60 days from the date of the AGM. The annual return gives a complete summary of the company. It includes the company’s registered office address, main business activities, details of shareholding, and information about directors, key managerial staff, and any related companies.
In accordance with Section 139 of the Companies Act, 2013, the appointment of an auditor must be filed with the ROC using Form ADT-1 within 15 days from the date of the AGM in which the auditor is appointed.
As per Rule 12A of the Companies (Appointment and Qualification of Directors) Rules, 2014, every individual who has been allotted a Director Identification Number (DIN) must submit Form DIR-3 KYC annually. This form includes personal details and contact information of the director.
Under the Income Tax Act, 1961, every company, other than companies claiming exemption under section 11, must file its income tax return in Form ITR-6. The due date for filing is typically September 30th of the assessment year.
Companies are required to maintain various statutory registers and records as per the Companies Act, 2013. These include:
Here are the key penalties for Non-Compliance:
If a company fails to file its Annual Return (Form MGT-7) or Financial Statements (Form AOC-4) on time, it must pay a penalty of Rs. 100 per day for each form. There is no maximum limit, so the fine keeps increasing daily until the company complies. This rule is enforced under Sections 92(5) and 137(3) of the Companies Act, 2013.
If a director doesn’t file their DIR-3 KYC on time, they must pay a penalty of Rs. 5,000. This rule is outlined under Rule 12A of the Companies (Appointment and Qualification of Directors) Rules, 2014.
Every company is required to conduct at least four board meetings in a year, with a maximum gap of 120 days between any two meetings. If this rule is not followed, each director may be fined Rs. 25,000 per missed meeting, as per Section 173 of the Companies Act, 2013.
If a company fails to appoint an auditor and file Form ADT-1 on time, both the company and responsible officers can face a penalty of Rs. 25,000 each.
If a company does not file Form INC-20A to declare the start of its business, it may be fined Rs. 50,000, and directors Rs. 1,000 per day.
Annual compliance is crucial for maintaining a Private Limited Company’s legal standing and credibility in India. Timely filings and accurate documentation under the Companies Act and Income Tax Act are essential. Staying compliant prevents legal issues and fosters business credibility, growth, and operational transparency. If you want to file this compliance for your Private Limited Company, contact Online Legal India to get assistance. They have qualified CA/CS to file all these compliances as per your requirements.
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