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Secretarial, Compliances & Legal Services

Secretarial, Compliances & Legal Services

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From Startup Specialist

    Secretarial & Compliances

    Secretarial Audit is a process by which the Secretarial Auditor provides an opinion as whether there are an appropriate systems and processes in the company commensurate with the size and operations of the company to monitor and check compliance with applicable laws, rules, regulations, and guidelines. The Key features of Secretarial Audit are as follows:-

    • recognizing the event of non-compliance and facilitating initiatives for corrective measures.
    • It audits the compliance of good corporate practices by the company.
    • It is an independent process intended to add value and improve the operations of the Company.
    • It helps in accomplishing the company’s objectives by bringing a systematic, productive approach to examine and potential effectiveness of risk management, control, and governance processes.
    • It provides necessary comfort to the management, regulators and stakeholders that there exists a proper system which ensures statutory compliance, good governance, and the existence of proper and adequate systems and processes.

    Secretarial Audit is compulsory for the following class of companies-

    • Every Listed Company.
    • Every public company having a paid-up share capital of 50 crore rupees or more.
    • A public company having a turnover of more than Rs. 250 crore or more.
    • Every company having a borrowing of 100 crores or more.

    Note- If anyone of the above criteria meets, a secretarial audit is mandatory.

    Following are the advantages of Secretarial Audit:-

    • It can be an effectual due diligence performance for the prospective acquirer of a company or possessing interest or a partner of a Joint venture.
    • It indemnifies the owners that the management and affairs of the company are being conducted following the requirements of law and that the owner’s stake is not being exposed to undue risk.
    • It administers professional discipline and self-regulation.
    • Reduces the work pressure of the regulators due to better and timely compliances.
    • It shows the right path to investors by showcasing your legal records.

    While conducting Secretarial Audit, the Secretarial Auditor needs to examine and report compliance under the following specific laws-
    The Companies Act, 2013 (the Act) and the rules made thereunder,
    The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made thereunder,
    The Depositories Act, 1996 and the Regulations and Byelaws framed thereunder,
    Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings.

    The detailed Secretarial Audit process is given below:-

    • Appointment of Secretarial Auditor.
    • Communication to earlier Incumbent.
    • Acceptance of Appointment by the Secretarial Auditor.
    • Preliminary Discussions about the company with the Secretarial Auditor.
    • Preliminary Meeting with the Auditor.
    • Finalization of Audit plan and briefing the staff.
    • Testing, Interview and Analysis.
    • Preparing the working papers.
    • Audit Summary for Discussions.
    • Submission of Secretarial Audit Report.

    Below-mentioned documents are required for Secretarial Audit-

    • Charter Documents and Statutory Registers.
    • Board and General Meeting Minutes & Notices.
    • Audited financial statements and Last year Secretarial Audit Report.
    • If the company is listed, Filings & Intimations with ROC, Stock Exchanges, Newspaper Advertisements.
    • Annual Performance Reports, Lease Deed, Bonds and returns.
    • Filings with RBI (If there is a foreign investment) and other statutory departments.
    • Registers maintained under Labour Laws.
    • Admission and Statement for code of conduct received from the directors.
    • Remuneration and Sitting fees details paid to directors.
    • Particulars of CSR amount.
    • SAST Disclosures.
    • Bank account details for dividend.
    • Details of ECB Returns, in case of foreign borrowings in the company.

    Why Legal Corner

    for Secretarial Audit?

    Legal Cornercomprises of dynamic team of experts and experienced business advisors and professionals who assist and execute the entire Secretarial Audit. Legal Corner helps its clients in conducting the Secretarial Audit by providing all the services like-

    Stock Exchange Listing Compliances

    All Companies listed with the recoginized stock exchanges in India are required to ensure perodical compliances as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

    The compliances are of different nature, viz. Quarterly, Half yearly, annually and event based. Some of the major periodical compliances are as listed hereunder-

    [wptb id=1858]


    The listed entity shall submit quarterly and year-to-date standalone financial results to the stock exchange within forty-five days of end of each quarter, (other than last quarter) along with Limited Review Report or Audit Report as applicable.
    The listed entity shall submit Annual Audited standalone Financial results for the financial year, within sixty days from the end of the financial year along with the audit report and either with Statement on Impact of Audit Qualifications (applicable for audit report with modified opinion(s) or declaration (applicable for audit reports with unmodified opinion(s).

    SEBI (Prohibition of Insider Trading) Regulations, 2015

    [wptb id=1863]


    As per Schedule B of the PIT Regulations Trading restriction period shall be made from the end of every quarter till 48 hours after the declaration of financial results.

    Half Yearly Compliance

    [wptb id=1864]


    In addition to the Financial portion Half Yearly Financial Result Includes

    1. Statement of Assets and liabilities and
    2. Cash Flow Statement.

    Annual Compliance

    [wptb id=1866]

    Director DIN e KYC Update

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    From Startup Specialist

      About Director

      KYC 2021 (DIN-3 KYC)

      KYC Filing for the Directors is an annual activity and applicable to every person who has obtained a DIN (Director Identification Number). The purpose of DIR-3 KYC filing is to keep the records of the ROC Updated with the correct address, mobile and email address of the directors. It is a mandatory filing, and if filed within the due date of 30th September 2021, there is no government fee. The DIN Numbers for which the KYC is not filed within its due date gets deactivated, and the same can be activated after the DIR-3 KYC is filed with late filing fees of Rs. 5000 for each such DIN Numbers.

      Document required for Director’s KYC Filing


      Front facing latest passport size Color photograph of the director of Partner of LLP in JPEG Format.

      Pan Card

      PAN is mandatory for Indian Citizens, Please submit a copy of your pan card. Ensure that the particulars are updated.

      Mobile Number for OTP

      Mobile number is required for OTP verification. Foreign citizens must give their overseas mobile No.

      Address Proof

      Passport,Voter Card, Driving License, Electricity Bill, Telephone Bill or Aadhaar (Not Older Than 2 Month)


      Passport is mandatory for Foreign Citizens, However if the indian applicant has a passport then it is mandatory to file.

      Email ID for OTP

      Furnish your email id on which government can sent communication and OTP for verification.

      Charge Creations /Modification /Satisfaction

      “Charge” means an interest or lien created on the property or assets of a company or any of its undertakings or both as security and includes a mortgage. [Section 2(16) of the Companies Act]

      Mandatory Requirements
      1. It shall be the duty of every Company creating a charge within or outside India, on its property or assets or any of its undertakings, whether tangible or otherwise, and situated in or outside India, to register the particulars of the charge signed by the Company and the charge-holder together with the instruments, if any, creating such charge in such form, on payment of such fees with the Registrar within thirty days of its creation.
      2. Where any charge on any property or assets of a company or any of its undertakings is registered, any person acquiring such property, assets, undertakings or part thereof or any share or interest therein shall be deemed to have notice of the charge from the date of such registration.
      Procedure to be followed

      A. Creation/Registration of Charge

        1. File Particulars of the Charge with ROC

          a. Company shall file the particulars of the Charge with ROC within 30 days of execution of the instrument creating or modifying charge in Form CHG-1 (for other than Debentures) or Form CHG-9 (For Debentures), duly signed by the Company and the charge holder along with the copy of the instrument creating and modifying charge and attach the following documents with Form CHG-1-

      • A Certified copy of the instrument or deed by which the charge is created or evidenced.
      • Instrument evidencing creation of charge in case of acquisition of property which is already subject to charge together with the instrument evidencing such acquisitions.
      • In case of Joint charge, particulars of all joint charge holders.
      • In case of filing of form beyond 30 days of creation of charge, declaration from the company signed by its secretary or director that such belated filing shall not adversely affect rights of any other intervening creditors of the company.
      • Detailed application (if form is filed after the expiry of 60 days).
      • Any other document, as applicable.

      Form CHG-9

      • Certified true copy of resolution authorizing the issue of the debenture series is a mandatory in case of creation of charge.
      • Instrument containing details of the charge created or modified is mandatory in all cases.
      • Order of the Central Government is mandatory in case eForm is being filed for rectification of charges.
      • In case of filing of form beyond 30 days of creation of charge, declaration from the company signed by its secretary or director that such belated filing shall not adversely affect rights of any other intervening creditors of the company.
      • Detailed application (if form is filed after the expiry of 60 days).
      • Any other document, as applicable.

          b. These forms can be filed after the expiry of 30 days but within additional period of 30 days on payment of additional fees.

          c. Where the instrument for creating or modification of charge is not filed within a period of 60 days from the date of its creation or modification, Company shall make an application for extension of time-limit for filing the relevant forms and ROC may allow such registration to be made within a period of further 60 days after payment of advalorem fees.

      B. Registration of Charge Beyond 120 Days

       1. Convene a Meeting of Board of Director

          a. Issue Notice of Board Meeting to all the Directors of Company at their addresses registered with the Company, at least 7 days before the date of Board Meeting. A shorter notice can be issued in case of urgent business.

          b. Attach Agenda, Notes to Agenda and Draft Resolution with the Notice.

          c. Hold a meeting of Board of Directors of the Company and pass the necessary Board Resolution

      • to authorize the Director or Company Secretary or CFO to file the application for condonation of delay of creation or modification of charge with Central Government.
      • to authorize any practicing professional or officer of the company for appearing before the Ministry of Corporate Affairs and execute an authorization in favour of such representative.

          d. Prepare and Circulate Draft Minutes within 15 days from the conclusion of the Board Meeting, by Hand/Speed Post/Registered Post/Courier/E-mail to all the Directors for their comments.

        2. File Application for Condonation of Delay

      Company shall file an application for condonation of delay to Central Government in Form CG-1 along with fees and following documents

      • Certified true copy of Board Resolution for authorizing the filing of the application and appointing the authorized representative.
      • Detailed application for the Condonation of delay.
      • Latest audited Balance sheet with profit and loss account.
      • MOA and AOA of the Company.
      • Any other document, as applicable.

      Central Government will scrutinize the application and issue the final order for either approving or rejecting the application.



      File Order of Central Government with ROC

      Company shall file the copy of final order passed by the Central Government with ROC in Form INC-28 along with requisite documents and fees as per the directions issued by the Central Government.

      File Particulars of the Charge with ROC

      Company shall file the particulars of the Charge with ROC after getting approval on the application for condonation of delay, in Form CHG-1 (for other than Debentures) or Form CHG-9 (For Debentures), duly signed by the Company and the charge holder along with the copy of the instrument creating and modifying charge and attach the following documents with Form CHG-1

      • A Certified copy of the instrument or deed by which the charge is created or evidenced.
      • Instrument evidencing creation of charge in case of acquisition of property which is already subject to charge together with the instrument evidencing such acquisitions.
      • In case of Joint charge, particulars of all joint charge holders.
      • Any other document, as applicable.

      Form CHG-9

      • Certified true copy of resolution authorizing the issue of the debenture series is a mandatory in case of creation of charge.
      • Instrument containing details of the charge created or modified is mandatory in all cases.
      • Any other document, as applicable.

      Certificate of Registration of Charge

      ROC will register the charge and issue Certificate of Registration of Charge in Form CHG-2 or modification of charge in Form CHG-3.

      Entries in Register of Charges

      Company shall make necessary entries in the Register of Charges in Form CHG-7 maintained by the Company. Director or CS or any other person authorized by the Board shall authenticate these entries.

      Registration of Charge Created before the commencement of the Companies (Amendment) Ordinance, 2019

      Company shall make an application to the Registrar to allow such registration to be made within a period of three hundred days of such creation.

      If the registration is not made within the period specified, the registration of the charge shall be made within six months from the date of commencement of the Companies (Amendment) Ordinance, 2019, on payment of additional fees and different fees may be prescribed for different classes of companies.

      Due Diligence

      Due diligence is conducted for an inspection and risk assessment for any upcoming business transactions. Ideally; it is a background check to ensure that the parties involved in the transaction have all the necessary information they need to proceed with the transaction. A due diligence is required to reveal misrepresentation and fraudulent dealings in a major business transaction.
      Due Diligence is the process by which confidential, legal, or financial and other material information are exchanged, reviewed and appraised by the interested parties who are going to enter into a Business transaction. Due diligence often refers to the in-depth research and study being done before signing an agreement or a business with a party.

      Business due diligence
      It looks into the quality and business prospects of an investment and the parties involved therein.

      Legal due diligence
      It looks into the legal issues/aspects and regulatory aspects involved in intra-corporate and inter-corporate transactions.

      Financial due diligence
      It validates financial, operational, and commercial assumptions taken by the company. This process also involves a complete review of audit practices, accounting policies, internal controls, and tax compliances of the target company.
      The findings obtained from the process of due diligence are summarized in a report termed as the due diligence report.

      Certain important aspects of a due diligence report are as follows-

      • Monetary Aspect: The report should rely on certain important financial data and precise ratio analysis to understand the entire picture related to the target company.
      • Viability: The business and financial plans of the target company should be studied thoroughly to assess the viability.
      • Personnel aspects: The report should make a thorough assessment of the credibility and capability of the people operating the company.
      • Environmental aspects: No business can separate itself from the environment around it. Therefore, it is important to study the environment and its overall impact on the company concerned.
      • Technological aspects: Assessing the technology available to the company at a given point of time is another important part of the due diligence process. Such an assessment would help a great deal to decide the future course of action.
      • Liabilities: The report should take into account any existing and potential liabilities (including regulatory issues, pending litigations, and so on) the company may come across.

      Mergers And Acquisitions:
      Due diligence is done from the perspective of the seller, as well as the buyer. While the consumer looks into the financials, litigation, patents, and a whole range of relevant information, the seller concentrates on the experience of the buyer, the financial abilities to complete the transaction, and the ability to fulfil responsibilities taken.

      Due diligence is done for necessary alliances, necessary connections, business combinations, and such other alliances.

      Joint Enterprise And Collaborations:
      When one company joins hands with another, the reliability of the company is a subject of concern. Assuming the other company’s stand includes the adequacy of supplies at their end.

      Apart from the above, there are various other transactions that requires Proper Due Diligence-

      • Strategic Alliance
      • Business Coalitions
      • Outsourcing Agreement
      • Technology or Product Licensing
      • Joint venture through technical or financial Collaboration
      • Venture Capital investment
      • Public Issue

      Due diligence is required for a business organization to ensure and have conscious of all the essential items like:-

      • Administration and Ownership:
        Analysis of Management and Control of the Company
      • Capitalization:
        Examining how large and volatile is the Company and market. A contrastive analysis of both of them is needed.
      • Business Competitors and Industries:
        Research and compare the boundaries of competitors for a better comprehension of the target Company.
      • Balance Sheet Review:
        This helps in interpreting the debt-to-equity ratio.
      • Revenue, Profit and Margin Bearings:
        To examine if there are any recent trends in the figures which may be rising, falling or stable?
      • Risks:
        It enables to learn industry-wide and Company-specific dangers, and all the checking if there are any on-going risks and trying to predict any futuristic unforeseeable threats in the future.

      • Capital History/Options and Probabilities:
        How long has the Company been dealing? For a short- term or long-term? Has there been a steady stock price?
      • Expectations:
        To maximize the profit for the future.

      During Due-Diligence Process, the following types of documents are required to be checked-

      • Basic information of the company
      • Financial Data
      • Important Business Agreements
      • Intellectual Property Right details
      • Litigation Aspects
      • Marketing Information
      • Internal Control check system
      • Taxation aspects
      • Insurance Coverage
      • Environmental Aspects
      • Human Resource Aspects
      • Cultural Aspects

      Appointment and Resignation of Directors

      Directors of the Board are the brain of the company. Directors are the Managerial Executives who control and administer the company’s activities. In the Company, revolution of directors takes place either by the selection of new director or resignation of the existing. A Company has to comply with certain procedures as per Companies Act, 2013 for change in directors. Authority to approve resignation of the director lies with the Board of Directors, whereas the appointment must be made through the consent of shareholders subject to recommendation by the Board of Directors. Whether it is an appointment, removal, or resignation, the change does not take effect continuously; the intimation is made to ‘Ministry of corporate affairs.’

      Documents needed for Appointment

      and Resignation of Director

      Photograph: Passport size photo of the Director

      PAN Card: Self-attested PAN card of the Director

      Proof of Residency: Aadhar Card/ Voter ID/ Passport/ Driving License of the proposed director

      Digital Signature Certificate: DSC of the ongoing Director and Director to be eliminated/removed

      Identity proof before-mentioned as Passport/Election card/Driving License/Aadhar card

      Mobile number and Personal & official email id of the Director

      It is mandatory to apostille all the documents apostilled if the Director is a non-resident of India

      Notice of resignation

      Proof of dispatch

      Acknowledgment of form, if received

      Filing requirement – Form DIR-12 to be filed with the concerned Registrar of Companies

      Strike off / Winding up

      Closing of Inactive or Defunct Company and Company Winding-UP has become easier
      The Company being a separate legal entity created by law; can be closed by the Rules prescribed under the Companies Act. An inactive or defunct Company can be struck off U/s 148(1) by filing STK-2 Form to the ROC with CA Certificate, affidavits and indemnity bonds.

      Closure of a Private Limited Company

      The Companies Act, 2013 prescribes an easy way out to close a company without going to NCLT in case that company is inactive or defunct. An inactive or dormant company with no assets or liabilities can file Form STK-2 Form to ROC for easy and fast closure. However, if the company is active, or where there are assets or liabilities, then for winding up, an application needs to be made to NCLT.

      This form needs to be filed to close a company that has not started its operations or if started, has become defunct and has been inactive for over two years. The application of such companies are filed in the prescribed form STK-2, the government fee payable on the STK-2 Form is Rs. 10,000/-

      Various Methods to Close a

      Private Limited Company

      When a Company is inactive for over two years or could not commence its business operations within one year of its incorporation, the easiest method is to make an application for striking off the name of the company by filing an application in Form STK-2 U/s 248 of the Companies Act.

      With the approval of 3/4 shareholders, the company can make an application to NCLT for its voluntary winding up. Under this process, an Insolvency Professional is engaged in dissolving the company’s assets and paying the lawful claims. On the recommendations of the IRP, the NCLT passes the order for the winding up.

      On an application by the creditors, ROC or the Central Government, the NCLT may start the compulsory winding-up of the company. An Insolvency Professional is appointed to dispose of the assets and pay the liabilities of the company. After the dissolution by RP is complete, the NCLT makes an order of winding up.

      1. The process of winding-up is carried before the NCLT.
      2. The insolvency professional sells all the assets and settles the liabilities. After winding up, the company comes to an end and cannot be revived in due course of time.
      3. The winding-up is final and brings a definite end to the company. No one remains liable for the outstanding liabilities that could not be paid during the liquidation process.
      1. The process of striking off is carried before the ROC and is based on the directors’ declarations.
      2. No insolvency professional is involved during the striking off process.
      3. The effect of the company striking off is that there is no compliance requirement, and for all practical purposes, the company has been closed.
      4. However, if there are any government dues, tax dues, or any liability that comes up after the striking-off, the company’s directors remain personally responsible. Before filing for striking off, we advise you to settle all disputes, accounts and pay all dues.

      Checklist for filing STK-2 Application

      for Company Striking off

      The company must be defunct or inactive under section 248; there are three situations in which a defunct or inactive company can be struck off; check the appropriate section under which the application is to be filed.

      Shareholder Consent:

      The Company can file the STK-2 application only when the shareholders of the company adopt a special resolution. A minimum of 75% shareholders vote is necessary for passing a special resolution.

      Pay all Government Dues:

      Before the decision to close the company is made, ensure that all government dues such as GST, Income Tax, PF, ESIC or any other company's liability towards the government are fully paid.

      Close Bank Accounts:

      The Company’s bank accounts need to be closed, and you should obtain a complete bank statement and the Bank Closure letter from the banker. These documents are filed along with STK-2 Form.

      No Assets or Liabilities:

      Before making the STK-2 application ensure that there is no assets or liabilities in the company; a statement of the assets and liabilities are filed with the STK-2 form after attestation with a Practicing Chartered Accountant.

      No Litigation:

      There should not be any pending litigation for the applicant company with the state government, central government, or agencies. Also, check that no Income Tax or GST Assessment is pending.

      CA Certification:

      A Chartered Accountant must attest to the Statement of Accounts showing NIL assets and liabilities in practice. The date of the statement should be within 30 days on which Form 24 is being filed.

      Check DIN & DSC Status:

      Every year DIR-3(KYC) must be filed to keep the DIN active; check the DIN status; if the KYC has not been filed, Please do file the DIN KYC. As the application for striking off the company is filed using Digital Signature, check if the DSC is valid for the partners; if not, Go for DSC Renewal.

      Change/alteration in ShareCapital of the Company

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      From Startup Specialist

        Overview of Change

        in Share Capital

        The amount of capital to invest in the Company is one of the most critical decisions that have to be made by the supporters when a company is in its incorporation stages. As the business begins to pick up, the Company may look to expand its operations, expand in size, scale, or structure. To make that dream a reality, it may require the driving of more funds into the Company, basically increasing/Changing the share capital of the Company. Sometimes, the amount of necessary capital might surpass the limit of the authorized capital at the time.
        The authorized capital is the greatest amount of Capital for which the Company can issue shares to the shareholders. As per the Section 2(8) of the Companies Act, 2013, the Authorised Capital limit is specified in the Memorandum of Association under the Capital Clause. A company may take the necessary steps required to Increase/Change the authorized capital limit to issue more shares. However, it cannot issue shares exceeding the authorized capital limit in any case.



        This is a staging enviroment