It is worth noting that the status of a small company may change from year to year depending upon the range of paid-up share capital and turnover. This means that if a company crosses any of the thresholds provided (either for paid-up capital or turnover), the benefits that are available during a given year may be removed in the following year and may be made available again in the subsequent year (or years).
Following are the characteristics of a small company:
With gradual growth of business, if a company cross any of the thresholds provided, either for paid-up capital or turnover, the company must give up the status of the small company and the benefits granted for such companies.
|4.||July||Filing of FLA with RBI, if having foreign liability or assets|
* Small companies must have a maximum of two meetings in a financial year- at least one meeting of the Board of Directors in each half of a calendar year and the gap between the two Board meetings must not be less than ninety days.
The concept of small companies was introduced by the companies act, 2013 for the first time. According to the Act some companies are termed as small companies based on their capital and turnover for the purpose of providing certain relief/exemptions to these companies.
A small company is a private limited company that satisfies both the following conditions:
The above definition of a small company is not applicable to the following (i.e., a small company cannot be the below ones):
According to the definition given above, the companies which fulfill the following provisions can be featured as the small company:
A small company is a private company whose capital does not exceed 2 crores or such higher amount as prescribed which shall not be more than 10 crores and turnover does not exceed 20 crores or such higher amount as may be prescribed which shall not be more than 100 crores while a Private company includes a Small Company.
If the capital of a Small Company or turnover exceeds the threshold limit, it is no more considered as a Small Company and it can no more enjoy the privileges granted to a Small Company under the Act.
Companies are required to file their Annual Accounts and Returns disclosing details of its shareholders, directors, etc to the Registrar of Companies. Such compliances are required to be made once a year.As a part of the Annual Filing, the following forms are to be filed with the ROC
The Annual Return of every Small Company shall be signed by the company secretary or where there is no company secretary by the director of the company.
There are different kinds of methods that can be opted for closing down the Small Company. Here are some of the ways by which you can close down your Small Company legally.
To register a small company following are the minimum requirements which are same as Private Limited Company:
Yes, Registration for a small Company is necessary as, without registration, there can be no existence of a company and no privileges and exemptions are offered by law to companies holding the status of a ‘small company’ can be availed.
Here is mandatory ROC compliance for a small Company:
The above forms need to be certified by CA/CS/CWA. The annual return filing of a small company can be signed by either a Company Secretary (CS) or a company director. The annual return filing of a private limited company other than a small company must be signed by both a director and a CS.
It is mandatory for all the companies which are registered under MCA to file their annual reports with the concerned ROC every year. However, for Private Limited Companies (including small Companies) , it is not mandatory to publish or release their annual report for Public access.
No, Annual filings are not required for the Fast Track Exit (FTE) closure of a small Company which failed to commence business.
There are only two criteria which are as follows:
The Company desirous to get its name struck off from the Register shall file an application in the prescribed Form STK-2 online with the Registrar. The form shall be accompanied by an affidavit, an indemnity bond, a statement of account duly certified by a Chartered Accountant in practice or auditor of the company, and a copy of board resolution showing authorization for filing the form.
As per Indian law, The Indian companies Act, 2013 states that a small Company in India can have a minimum of 2 directors and a maximum of 15 directors.
However, The Company may appoint more than 15 directors, only after passing a special resolution.
If you have failed to hold an AGM (Annual General Meeting) within the due date due to a natural disaster, You may seek the remedy from the Registrar of Companies, as ROC may extend the timeline for holding of AGM for a maximum of three months if there is a genuine and special reason for not holding the AGM within the specified time.
As in your case you have a genuine reason for not holding AGM due to natural disaster, the ROC may extend the timeline.
For this, you need to file e-form: GNL-1 with concerned ROC with a certified true copy of board resolution citing reason & period of extension required along with prescribed fees.
To add a director to a Small company, all you need is three things:
Be it a Startup or an established Private Limited company or a Small company, It is mandatory compliance to have the company’s account audited.
Even the appointment of an auditor within 30 days of the incorporation is mandatory compliance for a Private limited company.
To register a Small Company, the following are the minimum requirements:
Yes, a small firm can register with the Indian government as a private limited company. It gives them credibility and a positive image of their company in the eyes of suppliers, future customers, and financial institutions. It assists the organization in obtaining loans with minimal compliance from banks or potential clients when going into contracts.
Blending means transfer of one’s individual property in the common hotchpot and make it a part of the common property of the HUF. There must be an intention to throw the separate property into the common stock and it is necessary to waive all separate rights in respect of the property, which must be clearly established through a declaration. Only the coparcener is entitled to throw in HUF’s common property.
This is for achieving distribution of immovable property among members because giving it in any other manner will require registration for effective transfer.Each division is entitled to claim exemption under Sec 5 (vi) of the Wealth Tax Act.
HUF is a creation of law and cannot be created by the act of parties, therefore, HUF cannot be created for the first time by a gift from the stranger. If HUF already exists, gift can be made by a stranger to such HUF.The gifted property will be HUF property if the gift is made to HUF. Intention of donor & the character of the gifted property will depend on the construction of the gift deed. Precautions to be taken by family while accepting gifts
Property acquired in the course of some business carried on by the persons constituting a joint Hindu family, takes the characteristic of joint family property. As per Hindu law, in case of properties not acquired with the aid of joint family property, it is presumed that property acquired by coparceners by working together is joint family property unless the persons concerned desire to hold it as co-owners. This is valid if the coparceners are carrying on work together and belong to the same line of ancestors. The income from such property is out of the purview of section 64(2) of the Income Tax Act, 1961 and section 4(1 A) of the Wealth Tax Act, 1957. In the cases of properties acquired with the aid of joint family property is also the joint family property.
A HUF can also be created by will of a person provided the will is valid and there is a specific request in favor of the HUF. Moreover, HUF need not be in existence at the time of execution of will. Even a stranger can bring a HUF into existence by making a will in the favor of HUF of a person. HUF is created if there exist a valid will.
Partition of an existing HUF can also result in creation of many smaller HUFs. As per Hindu Law, the property does not change its character on partition. Property received by a coparcener having a family, continues to have characteristic of HUF. An unmarried coparcener receiving any property will own the property in the status of HUF until he acquires the status of HUF. In case of married coparceners who have no child, the property will continue with the status of HUF. However, the partition has to be total partition because the law does not recognize partial partition as per section 171(9) of the Income Tax Act, 1961.
Even after partition of HUF, members may re-unite to form a new HUF. However, there are certain conditions to make such reunion valid in the eyes of law. Reunion can take place only when there was in existence a HUF and there was total partition of such HUF. It can take place only between persons who were parties to the original partition and to support such reunion, there must be an agreement between the parties. To constitute a reunion there must be an intention of the parties to reunite in estate & interest and such intention is evident. As per Mitkarsha, Dayabhaga and SmritiChandrika, a member of a joint family once separated can reunite only with his
The minor cannot be a part of reunion neither by self nor by someone on behalf of such minor.