Look forward to heydays of CS professionals: Certification requirements under the new Act

Considering that there are only around 5,800 Practising Company Secretaries or PCS in the country, each one will get to sign a reasonable number of annual returns, even if all such companies were to be distributed evenly. So all the practising professionals surely have a reason to cheer!

There is enough buzz in the corporate world regarding the role of Practising Company Secretaries (PCS) under the Companies Act, 2013 (the Act, 2013). Professionals were worried inasmuch as the scope and position of a Company Secretary in employment seemed to have increased, the role of PCS was a matter of concern when the corresponding section of 383A under the Companies Act, 1956 (the Act, 1956) was missing in the Act 2013. However, it seems that Act, 2013 has widened the scope of services that a PCS can offer. One of such area is annual return to be filed by a company under Section 92 of the Act, 2013.

 

Based on the provisions of Section 92, 203 and 204 of the Act, 2013 read with relevant draft rules, relevant compliance requirements with respect to PCS can be enumerated as under:

Categories

Particulars

Requirement

Category I

Private companies with paid up capital of up to Rs5o lakh

May or May not appoint Company Secretary. However, if appointed, whether on a whole time basis or on a part time basis, will qualify as a KMP. So annual return will be signed by the Company Secretary

 

Where there is no company secretary appointed, the annual return shall be signed by the director of the company

Category II

  1. Private companies with paid up capital of above Rs50 lakh and up to Rs5 crore

 

  1. Public companies with paid up capital up to  Rs5 crore

May or may not appoint Company Secretary. However, if appointed, whether on a whole time basis or on a part time basis, will qualify as a KMP.  So annual return may be signed either by the Company Secretary where there is one or by PCS in the absence of a Company Secretary

Category III

  1. Companies with paid up capital of Rs5 crore and above;

Mandatory to appoint full time Company Secretary (Sec 203). So annual return will be signed by Company Secretary

 

  1. Companies with paid up capital of Rs5 crore or more and turnover of Rs25 crore or more;

Mandatory to appoint full time Company Secretary (Sec 203). So annual return will be signed by Company Secretary

 

Further, the annual return will be certified by PCS

Category IV

Public companies with paid up capital of Rs100 crore or more;

Mandatory to appoint full time Company Secretary (Sec 203). So annual return will be signed by Company Secretary

 

Secretarial Audit by PCS and, the Annual Return will be certified by PCS (as a company with paid up capital of Rs100 crore will surely have a turnover of Rs25 crore)

 

So such companies will need both Secretarial Audit and Annual Return certification from PCS

Category V

Listed company

Mandatory to appoint full time Company Secretary, so annual return will be signed by Company Secretary

 

Secretarial audit by PCS and, the annual return will be certified by PCS

 

So listed companies will need both secretarial audit and annual return certification from PCS

 

Further, in case of a PCS being a co-signatory to the annual return, the PCS will only be verifying the information stated in the annual return. However, where the annual return requires certification of PCS, the PCS shall not only verify the contents of annual return but also certify compliance with provisions of the Act (as specified in Form 7.8).

 

It is important to note that once the CS is appointed as a full time employee or a part-time employee immediately become a key managerial personnel (KMP) as per the definition of a KMP. Therefore, all the obligations of a KMP get attracted.

 

As per the information gathered from professional colleagues at present there are about nine lakh active companies. Out of these, about seven lakh companies have a paid up capital of up to Rs50 lakh, which comprises of about only 35,000 public companies and the rest are private companies (i.e. a ‘small company’ as defined u/s 2(85) of the Act, 2013)

 

So, if small companies are excluded from the abovementioned statistics, we will still have a reasonable figure of companies which will require its annual return to be signed by PCS. The reason behind this is that companies with paid up capital of below Rs5 crore were neither required to appoint a Company Secretary under the Act, 1956 nor is it mandatory to appoint under the Act, 2013. Therefore, we presume that these companies will not appoint a Company Secretary in employment. Further considering that there are only around 5,800 PCS in the country, each PCS will get to sign a reasonable number of annual returns, even if all such companies were to be distributed evenly. So all the practising professionals surely have a reason to cheer!

 

The content of annual return is very exhaustive as opposed to Schedule V under Act, 1956. Further, the certification is not limited to contents of Annual Return but also covers compliance with all the provisions of the Act. The format of certificate to be given under the Act (Form 7.8) is very similar to a compliance certificate under the Act, 1956. 1956. Apart from this, other particulars such as remunerations, details of KMP, number of board and committee meetings held etc. also has to be certified. Therefore, this certification in itself is wholesome.

 

However, it is to be kept in mind that with more responsibility comes more accountability. Keeping in mind that the certification requirements are by and large very exhaustive and complex, practising company secretaries have to exercise due caution.

 

(CS Vinita Nair and CS Aditi Jhunjhunwala are senior associates at Vinod Kothari & Co, and look after corporate law division)

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Passport Seva mobile app now on Windows, Apple phones

mPassport Seva mobile apps that provides a variety of services such as status tracking, locating a passport office and other general information is now available for Windows phones and Apple iPhones

Encouraged by the public response to its Passport Seva mobile app for Android phones, the Ministry of External Affairs (MEA) has now launched the application for Windows and Apple iOS platforms. Earlier in March, the MEA had released Android version of the app, which provides passport-related information on smart phones.

 

This is an extended service of the Passport Seva Project, executed in the public-private-partnership mode with IT services major Tata Consultancy Services (TCS).

 

In a release, TCS said mPassport Seva provides a variety of services such as status tracking, locating a passport office and other general information.

 

The application provides information on the various steps involved in obtaining a passport-related service and related phone numbers in case of queries or concerns, it added.

 

Users will also be able to search for a Passport Seva Kendra (PSK) or District Passport Cell (DPC) in a district where a passport application can be submitted. This can also be searched based on a PIN code. For certain States and districts, users can search for police stations as well.

 

Citizens residing overseas, who apply for a passport service in Indian Missions/Posts abroad, can also utilise this facility for searching addresses and other relevant information.

 

The fee calculator feature of the app enables users to find out the applicable fee based on the service and mode of submission.

 

Users can track the status of their passport applications by providing the file number and date of birth. In case the passport has been dispatched, delivery status can also be tracked.

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India launches first-ever mission to Mars

The Orbiter is expected to arrive on Mars on 14 September 2014 and the spacecraft will enter a highly elliptical orbit of 372km x80,000 km around Mars

India on Tuesday embarked on its maiden Mars odyssey, with its polar rocket carrying Mars Orbiter Mission, successfully lifting off from the Satish Dhawan Space Centre at Sriharikota. This is India's first-ever inter-planetary expedition to join a select band of nations.

 

The textbook lift-off of ISRO’s workhorse launch vehicle PSLV C25 at 2.38pm from the spaceport was witnessed among others by Minister of State in PMO, V Narayanasamy, US Ambassador to India Nancy Powell, Indian Space Research Organisation Chairman, K Radhakrishnan, and a host of other officials.

 

The XL version of PSLV C 25 had carried Chandrayaan 1, the country’s maiden moon mission, in 2008.

 

After going around Earth for 20-25 days in an elliptical orbit (perigee of 250 km and apogee of 23,500 km), the Rs450-crore Orbiter would begin a nine-month long voyage to Mars around 12.42am on 1st December.

 

It is expected to reach the red planet’s orbit by 24 September 2014 and go around in an elliptical orbit (periapsis of 366 km and apo-apsis of 80,000 km).

 

The Mars mission of the ISRO is aimed at establishing the country’s capability to reach the red planet and focus on looking for the presence of methane, an indicator of life in Mars.

 

The Mars Orbiter has five scientific instruments — Lyman Alpha Photometer (LAP), Methane Sensor for Mars (MSM), Mars Exospheric Neutral Composition Analyser (MENCA), Mars Colour Camera (MCC) and Thermal Infrared Imaging Spectrometer (TIS).

 

European Space Agency (ESA) of the European consortium, National Aeronautics and Space Administration (NASA) of the US and Roscosmos of Russia are the three agencies which have successfully sent their missions to the red planet.

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