MCA Form No. MGT-7 and Form No. MGT-7A – 2021
MCA Form No. MGT-7 and Form No. MGT-7A – 2021
The Ministry of Corporate Affairs (MCA) has come up with various crucial amendments by introducing the Companies (Management and Administration) Amendment Rules, 2021 vide a notification dated 5th March 2021. With this notification, MCA has amended a few provisions of the Companies (Management and Administration) Rules, 2014. The notification sought to substitute the rule in respect of Filing of Annual Return with the Registrar and notifies the new Form No. MGT-7 and Form No. MGT-7A. The new rule shall come into force on the date of their publication in the Official Gazette. This present article briefly covers all the amendments.
Synopsis of Companies (Management and Administration) Amendment Rules, 2021
The Synopsis of Companies (Management and Administration) Amendment Rules, 2021 is as follows. As mentioned above, the new rule sought to substitute the rule in respect of Filing of Annual Return with Registrar:
- As per Companies (Management and Administration) Amendment Rules, 2021, MCA Substituted sub-rule (1) of Rule 11 and Rule 12 of the Companies (Management and Administration) Rules, 2014.
- MCA also Notified Form No. MGT-7 for Annual Return for companies other than One Person Company (OPC) and Small Companies
- Notified Form No. MGT-7A for Abridged Annual Return for OPCs and Small Companies.
Amendment in Rule 11 – Annual Return
As per the earlier rule, every company needs to prepare its annual return in Form No. MGT.7
New Form No.MGT-7 – Annual Return (other than OPCs and Small Companies
- As per the Companies (Management and Administration) Amendment Rules, 2021, every company need to file its annual return in Form No.MGT-7 except for One Person Company (OPC) and Small Company.
The new Form No.MGT-7 is reproduced below for your reference:CompaniesMgmtAdminAmndtRules_05032021-4-18
New Form No.MGT-7A – Abridged Annual Return for OPCs and Small Companies
- One Person Company and Small Company need to file an annual return in Form No.MGT-7A from the financial year 2020-2021 onwards
The new Form No.MGT-7A is reproduced below for your reference:CompaniesMgmtAdminAmndtRules_05032021-18-30
The annual return, filed by a listed company or a company having paid-up share capital of Rs.10 crore rupees or more or turnover of Rs.50 crore rupees or more, need to be certified by a Company Secretary in practice and the certificate should be in Form No. MGT.8.
Amendment in Rule 12 – Filing of Annual Return with Registrar
In the Companies (Management and Administration) Rules, 2014 for rule 12, the following rule will be substituted:
A copy of the annual return will be filed with the Registrar with the fees prescribed.
Amendment in Rule 20 – Voting through electronic means
The provisions of this rule shall apply in respect of the general meetings for which notices are issued on or after the date of commencement of this rule. Every company which has listed its equity shares on a recognized stock exchange and every company having not less than one thousand members shall provide to its member’s facility to exercise their right to vote on resolutions proposed to be considered at a general meeting by electronic means
Companies (Management and Administration) Rules, 2014, in rule 20, after sub-rule (2), the following explanations shall be numbered.
Explanation-I – Nidhi Company
Companies (Management and Administration) Amendment Rules, 2021 defines that,
Nidhi is a company that has been incorporated as a Nidhi with the following objectives:
- Cultivating the habit of thrift and savings amongst its members
- Receiving deposits from and lending to its members
- for the mutual benefit of the company and its members
The Nidhi complies with the rules made by the Central Government for the regulation of the Nidhi class of companies.
Companies (Management and Administration) Amendment Rules, 2021 specifies that agency means the following organizations:
- National Securities Depository Limited, the Central Depository Services (India) Limited or any other entity approved by the Ministry of Corporate Affairs subject to the condition that the National Securities Depository Limited
- The Central Depository Services (India) Limited or such other entity has obtained a certificate from the Standardization
- Testing and Quality Certification Directorate, Department of Information Technology, Ministry of Communications and Information Technology, Government of India
The new rule defines Cut-off Date as, a date not earlier than one week before the date of the general meeting for determining the eligibility to vote by electronic means or in the general meeting
The Companies (Management and Administration) Amendment Rules, 2021 defines Cyber Security as protecting information, equipment, devices, computer, computer resource, communication device and information stored from unauthorized access, use, disclosures, disruption, modification or destruction.
Electronic voting System
Electronic voting System means a secured system based process of display of electronic ballots, recording of votes of the members and the number of votes polled in favour or against, in such a manner that the entire voting exercised by way of electronic means gets registered and counted in an electronic registry in a centralized server with adequate cybersecurity
As per the amendment rules, remote e-voting means the facility of casting votes by a member using an electronic voting system from a place other than the venue of the general meeting
- The secured system means computer hardware, software, and procedure that are reasonably secure from unauthorized access and misuse
- The secured system means the procedure provides a reasonable level of reliability and correct operation
- The secured system means procedure provides a reasonably suited to performing the intended functions
- Secured system adhere to generally accepted security procedures
Voting by electronic includes “remote e-voting” and voting at the general meeting through an electronic voting system which may be the same as used for remote e-voting
Purpose of the e-Form MGT-7/MGT-7A
Every company needs to prepare an annual return in the form of MGT-7 containing the particulars as they stood at the close of the financial year. The trader needs to furnish the following details in the New Form No.MGT-7 and MGT-7A:
- Company Registration details
- Principal business activities of the company
- Details of holding subsidiary and associate companies (including a joint venture)
- Share Capital, Debentures and other Securities of the Company
- Turnover and net worth of the company
- Shareholding Pattern – Promoters, Public/Other than Promoters
- Number of promoters, members and debentures holders
- Details of directors and key managerial personnel
- Details of members of the company
- Remuneration of directors and key managerial personnel
- Material related to certification of compliances and disclosures
- Details of Penalty and punishment
This e-form can be filled by attaching the scanned copy of documents under the attachments head.
- List of shareholders, debenture holders
- Approval letter for extension of AGM;
- Copy of MGT-8;
- Optional Attachment(s), if any
Due date of filing Form MGT-7/MGT-7A
Form MGT-7 is to be filed within 60 days from the date of the Annual General Meeting of the company.
- The due date for regulating the annual general meeting is on or before the 30th day of September following the close of every financial year. Therefore, the last date for filing form MGT-7/MGT-7A is generally the 29th of November every year.
Procedure for Filing of Form MGT-7/MGT-7A
The following steps can be used for filing the Form MGT-7 on the MCA portal.
- The applicant needs to access the official website of the Ministry of Corporate Affairs to file Form MGT-7. By login into the portal, the applicant can upload the Form MGT-7/MGT-7A.
- After login to the portal, enter a valid ‘Corporate identity number’ (CIN) for cancellation of unused issued Share of one class and increase in share capital.
- Select the purpose of the eForm from the drop-down menu and in case of others selected, specify the entity in the description box
Declaration and Designation
Select any one of the options from the drop-down values for declaration and digitally sign the Form MGT-7/7A.
- In case the person digitally signing the Form MGT-7 is a Director, approved DIN need to be provided.
- In case the person digitally signing the Form MGT-7 is Manager, enter approved DIN or valid income-tax PAN.
- Membership number need to be filed, in case the person digitally signing the Form MGT-7 is Company Secretary
- By clicking on the attach button, the required document can be uploaded and click on the pay the payment button for making the fee.
- On successful submission of the Form MGT-7, the eForm will be processed by the office of the Registrar of Companies.
SRN will be generated and displayed to the applicant on successful submission of the Form MGT-7. This SRN will be used for future correspondence with MCA.
On successful submission, a challan will be generated depicting the details of the fees paid by the user to the Ministry. It is the acknowledgement to the applicant that the Form MGT-7 has been filed.
When the Form MGT-7 is completely processed by the authority, an acknowledgement will be sent to the official mail of the company.