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It is the first question in the mind of Startup founders, i.e. which legal structure should they select? Most of the Startup founders are in dilemma whether they should choose LLP or Private Limited Company. However, it is important to note here that both are eligible for recognition as Startup as per  “Startup India campaign”  of government of India. After the announcements made in the Finance bill 2017 it is important to discuss the comparison between an LLP and Private limited company from a taxation point of view. In this article I am discussing the key differences between an LLP and Private Limited Company from taxation aspects and which structure seems to be more tax efficient after the proposed amendments by the finance bill 2017. 1. Rate of Tax ♥ LLP:  The Rate of tax applicable to LLP is flat 30%. For income tax purpose, LLP is treated at par with partnership firms. If the total Income of LLP has exceeded Rs 1 Crore, amount of Income Tax shall be increased

On 09/02/2016 MCA has issued draft In comparison to CARO, (2015), CARO (2016) and proposes additional reporting on the following:- Auditor should report (i) Whether title deeds of immovable properties are held in the name of the company. If not, provide details thereof. (ii) Whether the company has granted any loans, secured or unsecured to companies, firms or other parties covered by clause (76) of Section 2 of the Companies Act, 2013. If so, Whether the terms and conditions of the grant of such loans are not prejudicial to the company’s interest.

A.   Time period for Issue of Certificate: • The capital instruments should be issued within 180 days from the date of receipt of the inward remittance received through normal banking channels including escrow account opened and maintained for the purpose or by debit to the NRE/FCNR (B) account of the non-resident investor.

1. Auditor should report whether title deeds of immovable properties are held in the name of the company. If not, provide details thereof. [Clause 3 (i) (c) of CARO, 2016]   2. Auditor should report whether the company has granted any loans, secured or unsecured to companies, firms or other parties covered by clause (76) of Section 2 of the Companies Act, 2013. If so     -  Whether the terms and conditions of the grant of such loans are not prejudicial to the company's interest.[Clause 3 (ii)(a) of CARO, 2016]   3. Auditor should report in respect of loans, investment and guarantees, whether provisions of section 185 and 186 of the Companies Act, 2013 have been complied with. If not, details should be provided. [Clause 3(iv) of CARO, 2016]   4. Auditor should report whether managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act? If not, state the amount invol

Companies Act 2013, paved way for many new reporting requirements.Section 143(3)(i) is one of those sections which has caused many professionals to contribute their thoughts in form of talks and articles. Much is spoken and written about the “Internal Financial Controls (IFC), Audit of IFC, IFC from perspective of Internal Control as contained in SA31……

Analysis of Notifications dated 01.06.2016 related to Companies Act, 2013 in respect of National Company Law Tribunal (NCLT) and National Company Law Appellate  Tribunal (NCLAT) Which Come Into Force w.e.f. 01 st  June, 2016 Ministry of Corporate affairs wide  Notification 01 June, 2016  constitutes National Company Law Tribunal and National Company Law Appellate Tribunal, and S.J Mukhopadhaya, retd. Judge of Supreme Court joins as the Chairperson of NCLAT while M.M Kumar, Judge (Retd.) joins as the President of NCLT. With the constitution of the NCLT, the  Company Law Board constituted under the Companies Act, 1956 stands dissolved.

SI Notified Section Related Matters in short

Introduction The Central Government introduced the  Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Central Registry) Amendment Rules, 2016  (hereinafter referred as ‘Amendment Rules, 2016’) on January 22, 2016 (being the date of publication in the Official Gazette) requiring the particulars of transactions to be registered with Central Registry of Securitisation Asset Reconstruction and Security Interest of India (‘CERSAI’) by banks and financial institutions as the Central

In the Present era, the market is booming up so every Company want to take opportunity to earn more from the same market and want to get maximum benefits out of that, so what are the ways available for Company to avail such benefits. So for that, Private Company has to change its  Mission  as well as the  Vision  and going for getting those benefits by Converting into Limited Company and after that by listing in SME platform. So for that I will provide you the basics of SME IPO. What is SME ? SME means Small and medium-sized enterprises or small and medium-sized businesses (SMBs) are businesses whose personnel numbers fall below certain limits. What is SME Exchange ? “SME exchange” means a trading platform of a recognised stock exchange having nationwide trading terminals permitted by the Board to list the specified securities issued in accordance with this Chapter and includes a stock exchange granted recognition for this purpose but does not include the Main

A company is an association formed by people, whether living or artificial, with a motive to earn profit. It is a legal entity which has the power to ask money from outsiders in the form of shares, may it be privately owned or public. An existing company which is privately owned or unlisted company can be converted into a LLP after following a proper procedure, which is as follows:  i. Apply for the application of allotment of LLP in form 7.  ii. In case if some of the shareholders of the company already acquire a DIN, then they are new designated partners of LLP and they must have DSC for the LLP.  iii. Decide the name of the LLP and register it for the incorporation of LLP.  iv. The approval of the registrar is necessary keeping in mind the name does not resemble with the name of any existing body corporate, company or firm registered. v. Application has to be made in the Form 1 for the availability of the proposed name and application fee is paid with a credit card. 

COMPLETE AND CLEAR UNDERSTANDING OF  SECTION 62 & 42 OF THE COMPANIES ACT 2013 FURTHER ISSUE OF SHARE CAPITAL Section 62 of the Companies Act 2013 1) Where at any time, a company having a share capital proposes to increase its subscribed capital by the issue of further shares; such shares shall be offered-- a. ON RIGHT BASIS: To the existing shareholders in proportion to the paid up share capital of the Company held by them by way of a  letter of offer. PROCEDURE FOR ALLOTMENT OF SHARES ON RIGHT ISSUE BASIS : Issue notice in writing to every Director at least seven days’ before convening the Board meeting. [Sec 173 (3)]

Summary of 27 Chapters on Board of Directors’ in 27 Pages covering about 30% Examination Paper Company To Have Board Of Directors (Section 149) (1) Minimum Number of Directors • For public company, minimum number of directors is 3 • For private company, minimum number of directors is 2 • For One person company, one director is the minimum director. (2) Maximum Number of directors • Maximum number of directors is 15 for each kind of company • After passing special resolution company may appoint more than 15 directors. (3) Woman Director (Sub sec. 1) Woman Director on the Board (Rule 3) Companies (Appointment of Directors)Rules 2014 Class of companies shall appoint minimum one woman director – (a) Listed company (b) Other public company - With paid up capital of 100 crore of rupees or more or - Turnover of 300 crore of rupees or more (4) Resident Director:  Every company to have at least one director having stayed in India for total period of not less than 182 d

BACKGROUND The Board of Directors { Board} of a company is its highest decision making organ whose actions are however subject to shareholders jurisdictions as per the scheme of the Company jurisprudence. The directors constituting the Board act collectively, as well as individually, depending upon the position they hold and the authorities granted to them by the Board/ shareholders and the statute. To ensure smooth functioning of the corporate sector it is imperative that the past actions of the directors are protected in case it is noticed later that their appointments have become invalid. Provision to this effect was already present in the section 290 of the erstwhile Companies Act 1956 , and, in the new Companies Act 2013  this has again be provided in section 176.     SECTION  176  COMPANIES ACT  2013 “176. No act done by a person as a director shall be deemed to be invalid, notwithstanding that it was subsequently noticed that his appointment was invalid by reason of

First of all we have to understand what is non profit making Company: A Non Profit making Company is a Company which: Has in its objects, the promotion of Commerce, art, science, sports, education, research, social welfare, religion, charity, and protection of environment or any other such objects. Intends to apply its profits or any other income in promoting its objects. Intends to prohibit the payment of any dividend to its members.

INTRODUCTION Recently the Company Law Board, Delhi Bench while dealing with a matter involving resignation of a director under the Companies Act, 1956, has passed an order in the case of  Manav Kumar Agarwal V. Discovery Enterprises Pvt. Ltd & Others [1]   that, the resignation given by any Director from the post of Director shall not be construed as the resignation until the Board of Directors approve such resignation by passing a resolution in this regard. In this article we will analyze the aspects of

Comparison of CARO reporting as per Companies Act, 2013 and Proposed Caro (2016) The Ministry had set-up a Committee on 16th September, 2015 to examine and recommend matter for inclusion in the statement to be attached with Auditor’s Report under Section 143(11) of the Companies Act, 2013 for the financial year 2015-16 onwards. The said Committee has since made

A Comparative Analysis of Section 185 of Companies Act 2013 & proposed amendment in  Companies Amendment Bill 2016 As we are all aware that the Central government on 16th of March, 2016 introduced in the Lok Sabha a bill to further amend the Companies Act, 2013 as part of efforts to address difficulties faced by stakeholders and improve the ease of doing business in the country, which is yet to get approval

Common resolutions F or MCA21 related queries including Annual filings, Linked filings, Cancel SRN service, Resubmission, and Additional Fee waiver 1. Which eforms can I file as attachments with GNL-2? Annual filing eforms under the Companies Act, 1956 viz. 23AC/ACA, 23AC/ACA-XBRL, 20-B, 21-A, Form 66, I-XBRL, A-XBRL, 23B, 23C and 23D would be made available shortly for filing purposes. Users are requested not to file these forms as attachments with GNL-2 eforms. 2. How can I file CRA-4 and Refund eforms as they are not available on www.mca.gov.in? The CRA-4 (Companies Act, 2013) and Refund eforms would also be made available shortly for

The Companies Act 2013 was enacted to improve corporate governance and to further strengthen regulations for the companies, keeping in view the changing economic environment as well as the growth of our economy. The Ministry of Corporate Affairs has notified 284 Sections of the Act. However, there were difficulties in smooth implementation of the Companies Act 2013. The Ministry of Corporate Affairs has issued various notifications, circulars, Removal of difficulty orders and amendment in Rules for resolving the issues and to help in smooth implementation. Further, certain amendments were also brought through the  Companies (Amendment) Act 2015 .

The Ministry of Corporate Affairs has notified the Companies (Auditor's Report) Order, 2016 (CARO 2016) vide its Notification no. S.O. 1228(E) dated 29th March, 2016. This Order supersedes the Companies (Auditor's Report) Order, 2015 dated 10th April, 2015 and shall be applicable for the financial year commencing on or after 1st April, 2015. CARO 2016 has introduced a number of new reporting requirements by Statutory Auditors and has cast much more responsibility on them as compared to the CARO 2015. In this Article, an attempt has been made to compare the provisions of CARO 2015 and CARO 2016 with the aim of highlighting the changes put forth by CARO, 2016 and the revised requirements to be complied going forward. This is not an analysis of the CARO 2016 but a comparison with its previous order to throw light on the changes introduced in order to facilitate an understanding of the new requirements and to prepare ahead. While making the comparison, CARO 2015 has been take