Event-Based Compliance Made Simple

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What Are Event-Based Compliances?

Event-based compliances are statutory requirements that activate when specific corporate actions occur, demanding immediate filing with the Registrar of Companies. These differ from regular periodic compliances as they respond to particular business events like director changes, share capital modifications, or registered office shifts. The Companies Act 2013 requires incorporated entities to notify authorities within designated timeframes following such events.

Companies and LLPs must maintain transparency by promptly disclosing material changes including leadership appointments, constitutional amendments, or operational relocations. Non-compliance can result in penalties and legal complications. These obligations ensure regulatory oversight and protect stakeholder interests while maintaining corporate governance standards. Directors hold primary responsibility for identifying triggering events and ensuring timely submissions to relevant authorities.

Major Event-Based Compliance Categories

Board and Management Changes

Companies must report any changes in their leadership structure within specified timeframes. Key requirements include:

  • Director appointments, resignations, or modifications
  • Managing Director appointments and partner designation changes
  • Acquisition of Director Identification Numbers (DIN) or Digital Signature Certificates (DSC)
  • Updates to corporate records and statutory registers

These changes affect corporate governance structure and decision-making authority, making timely reporting essential for maintaining regulatory compliance.

Constitutional and Structural Changes

Fundamental changes to corporate structure require comprehensive documentation and regulatory approval. Major areas include:

  • Amendments to Memorandum or Articles of Association
  • Statutory auditor appointments or changes
  • Share transfers, new issuances, and transaction processing
  • Authorized capital modifications or increases
  • Corporate name changes or registered office address modifications

These structural changes often require shareholder approval and board resolutions before regulatory filing can occur.

Governance and Documentation Requirements

Proper governance practices require systematic documentation and reporting. Essential requirements include:

  • Board meeting, general meeting, and committee meeting minutes
  • Charge registration, modification, or satisfaction processes
  • Bank signatory updates and auditor appointments or removals
  • Maintenance of statutory registers and corporate records

The governance framework ensures transparency and accountability in corporate decision-making processes.

Statutory Reporting Obligations

Core statutory obligations require coordination between management, auditors, and compliance teams. Key areas include:

  • Annual account audits and financial statement filings
  • Annual return submissions and Directors’ report preparation
  • Board meeting conduct and Annual General Meeting organization
  • Income tax return and audit compliance

These obligations often have interconnected deadlines that require careful coordination to avoid compliance gaps.

Corporate Restructuring Activities

Complex business changes trigger specialized compliance requirements. Major categories include:

  • Share subdivision or consolidation activities
  • Business transformation and organizational restructuring initiatives
  • Business expansion or division activities
  • Private placement transactions and credit monitoring compliance

These activities often require advance regulatory approval and comprehensive documentation of business rationale and financial impact.

Forms For Event-Based Compliance

Private limited companies must file various forms with the Registrar of Companies (ROC) to notify about organizational changes and maintain regulatory compliance. These event-based compliance forms must be submitted within specified timeframes following corporate events or occurrences. The following table outlines the key forms, their associated events, and compliance timelines that private limited companies must adhere to for proper regulatory reporting:

Occurrence/Event

Details of the Compliance

Form

Declaration of Commencement of Business

Companies must file this form within 180 days from the commencement of business or incorporation to confirm operational status.

INC-20A

Change in Registered Office

Any change in the company’s registered office address must be reported within 15 days of such change.

INC-22

Change in the name of the company

Name changes must be notified within 60 days from the application filing in the INC-1 form.

INC-24

Conversion of the company

This form is required when a company undergoes conversion from one type to another.

INC-27

Application for KYC of the directors

Directors must complete their KYC compliance on or before 30th April of each financial year.

DIR-3

Change in Directors or KMP

Any appointment, resignation, or change in directors or Key Managerial Personnel must be filed within 30 days.

DIR-12

Removal of Director

Special resolution for director removal must be filed within 30 days from the date of passing the resolution.

ADT-2

Increase in the authorised share capital

Ordinary resolution for capital increase must be filed within 30 days from the date of passing.

SH-7

Filing of resolutions or agreements

All resolutions and agreements must be filed within 30 days from the date of passing the resolution.

MGT-14

Increase in paid-up share capital

Share allotment details must be filed within 15 days from the date of allotment of share capital.

PAS-3

Creation, modification and satisfaction of charge

Any creation or modification of charges on company assets must be reported within 30 days.

CHG-1

Condonation of delay

This application is filed when companies need extension of time limits with detailed information and required documents.

CG-1

Deposits taken

Companies accepting deposits must file by 30th June annually with audited information by 31st March.

DPT-3

The Significant beneficial owner reported

Companies must report significant beneficial ownership within 30 days from receipt of the BEN-1 form.

BEN-2

Critical Compliance Framework

Companies must maintain comprehensive documentation and board resolutions when reporting changes to the ROC. The regulatory framework demands accurate and timely disclosure of all material business events and structural modifications. This documentation requirement ensures transparency and provides evidence of proper internal governance processes.

Legal Consequences: Non-compliance can result in serious enforcement actions against both the company and its leadership team. Companies and key management personnel face substantial financial penalties and potential legal consequences for compliance failures. The enforcement framework extends personal liability to directors and key managerial personnel, creating individual accountability for corporate compliance obligations.

Compliance Timing and Penalty Framework

The submission timeline varies based on the specific transaction type or triggering event. Current corporate legislation includes stringent penalty provisions for non-compliance scenarios, with financial penalties that escalate based on the severity and duration of violations.

Companies must establish robust tracking systems to monitor triggering events and ensure the timely submission of required filings. The regulatory framework requires organizations to maintain legal protection and operational continuity through proper compliance management.

Frequently Asked Questions

Missing deadlines results in penalties and potential legal consequences for both the company and its directors. Companies can file for condonation of delay using Form CG-1, but this involves additional fees and explanations. Repeated non-compliance can lead to prosecution and the disqualification of directors.

The filing timeline varies depending on the specific event and form required. Most event-based compliances must be filed within 15 to 30 days from the date of the triggering event. Some forms like PAS-3, require filing within 15 days, while others like DIR-12 allow up to 30 days.

Filing deadlines vary depending on the specific event type, ranging from 15 days for registered office changes to 180 days for commencement of business declarations. Most common events like director changes or capital increases, require filing within 30 days.

Yes, if multiple events occur around the same time, companies can file different forms simultaneously. However, each form has its own deadline and requirements. It’s important to track each compliance separately to avoid missing any deadlines.

Yes, while both private and public companies face event-based compliance requirements, public companies typically have additional obligations, more stringent timelines, and enhanced disclosure requirements. Private companies benefit from certain relaxations but must still meet all mandatory filing requirements when triggering events occur.

While some annual compliance requirements have exemptions for small companies, most event-based compliances apply to all private limited companies regardless of size. However, certain procedural simplifications may be available for small companies in specific situations.

Penalties vary based on the specific compliance requirement and delay duration, typically ranging from ₹10,000 to ₹5,00,000 or more. Directors can face additional penalties, disqualification proceedings, and in severe cases, criminal prosecution. Repeated non-compliance can result in the company’s strike-off and the director’s disqualification.