Incorporation of a company requires lots of effort and initial capital. But to run the business in a uniform and stable manner is a much bigger and difficult task to do. Every promoter or director of a newly incorporated private limited company should be aware of the compliance that is to be done, post the incorporation of private limited company.

Further, there are lot of rules and regulations that a company has to comply to carry on its business smoothly. In this article, we are going to discuss only those mandatory posts incorporation compliance that the promoters may not miss out post the incorporation of the company.

Here below are the Post Incorporation Compliance that each and every Private Limited Company should follow post incorporation:-

1. Application of PAN (Permanent Account Number) and TAN (Tax Deduction Number)

As a company is a separate legal entity, it is mandatory for the company to apply for both PAN and TAN of the company. It simply states, that the company has registered itself under Income Tax Act.

2. Opening of A Bank Account in the name of Company

Post the allotment of PAN, the company should open a bank account number in the name of the company with the help of the documents such as, MOA (Memorandum of Association), AOA (Article of Association) and COI (Certificate of Incorporation). The subscriber needs to deposit the requisite amount in company’s bank account.

3. Appointment of First Auditor of the Company

This is the most important compliance which new start-ups are failing to comply with, due to unawareness or lack of knowledge.

The company registered in India is required to appoint an individual or a audit firm as its first auditor post its incorporation. The company accounts of the company are required to be audited by the First Auditor of the Company.

As per Section 139(3) of the Companies Act, 2013, ‘company (other than Government Company) has to appoint its first auditor within 30 days from the date of incorporation in a Board Meeting. If the Board is unable to appoint, then he has to be appointed within 90 days at an Extraordinary General Meeting of the members of the company.’

In simpler terms, an auditor should be Qualified Chartered Accountant, who shall hold the Certificate of Practice. A Form named ‘ADT- 1’ needs to be filed to the Ministry so as to intimate them about the company’s first auditor.

As per Section 147 of Companies Act, 2013, if the above mentioned provision is contravened then the company shall be punishable with fine which shall not be less than twenty-five thousand but may extend to five lakhs rupees and every officer of the company who is in default shall be punishable with imprisonment for a term which may extend to one year or with fine which shall not be less than ten thousand rupees which may extend to one lakhs or both.

4. Issue of Share Certificate to subscribers of Memorandum of Association (MOA)

Every new start-ups fails issue share certificate to the subscribers of the company. It so, happens as they are unaware about the same.

As per Section 56 (4) (a) of Companies Act, 2013 every company is required to allot and deliver share certificate to all the subscribers to the Memorandum of Association within 2 months from the date of Incorporation. To comply with the above provisions, a private limited company post the incorporation has to first open a bank account in the name of the company. The subscriber to the MOA are required to deposit subscription money of shares as agreed in company’s bank account either through cheque or net banking.

If the above mentioned provision is contravened then the company shall be punishable with fine of Rs. 5,000 which may extend to maximum limit to Rs. 25,000 and every officer of the company is punishable with fine which shall not be less than Rs. 10,000 but which may extend to Rs. 1,00,000.

5. Maintenance of Statutory Register of a company

Every company should maintain a defined Statutory Register of the Company from the time of Incorporation. It is not only a significant part of compliance but it also assists to keep all the statutory records enacted.

 

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