UNIT 4
E Governance and Winding up Company
Q1)Write the importance of the e governance?
A1) IMPORTANCE
Q2) Short note on MCA portal and its services
A2) MCA PORTAL
The Ministry is primarily concerned with administration of the Companies Act 2013, the Companies Act 1956, the Limited Liability Partnership Act, 2008 & other allied Acts and rules & regulations framed there-under mainly for regulating the functioning of the corporate sector in accordance with law.
The Ministry is also responsible for administering the Competition Act, 2002 to prevent practices having adverse effect on competition, to promote and sustain competition in markets, to protect the interests of consumers through the commission set up under the Act.
Besides, it exercises supervision over the three professional bodies, namely, Institute of Chartered Accountants of India(ICAI), Institute of Company Secretaries of India(ICSI) and the Institute of Cost Accountants of India (ICAI) which are constituted under three separate Acts of the Parliament for proper and orderly growth of the professions concerned.
The Ministry also has the responsibility of carrying out the functions of the Central Government relating to administration of Partnership Act, 1932, the Companies (Donations to National Funds) Act, 1951 and Societies Registration Act, 1980.
MCA SERVICES
1. Obtain Digital Signature Certificate
About Digital Signature Certificate (DSC)
The Information Technology Act, 2000 has provisions for use of Digital Signatures on the documents submitted in electronic form in order to ensure the security and authenticity of the documents filed electronically. This is secure and authentic way to submit a document electronically. As such, all filings done by the companies/LLPs under MCA21 e-Governance Programme are required to be filed using Digital Signatures by the person authorized to sign the documents.
Related Links and Artefacts
1 Legal Warning: You can use only the valid Digital Signatures issued to you. It is illegal to use Digital Signatures of anybody other than the one to whom it is issued.
2. Certification Agencies:
Certification Agencies are appointed by the office of the Controller of Certification Agencies (CCA) under the provisions of IT Act, 2000. There are a total of eight Certification Agencies authorized by the CCA to issue Digital Signature Certificates (DSCs). The details of these Certification Agencies are available on the portal of the Ministry Certifying Authorities External link image
3. Class of DSCs:
The Ministry of Corporate Affairs has stipulated a Class-II or above category signing certificate for e-Filings under MCA21. A person who already has the specified DSC for any other application can use the same for filings under MCA21 and is not required to obtain a fresh DSC.
4. Validity of Digital Signatures:
The DSCs are typically issued with one year validity and two year validity. These are renewable on expiry of the period of initial issue.
5. Costing/ Pricing of Digital Signatures:
It includes the cost of medium (a UBS token which is a one time cost), the cost of issuance of DSC and the renewal cost after the period of validity. The company representatives and professionals required to obtain DSCs are free to procure the same from any one of the approved Certification Agencies as per the MCA portal. The issuance costs in respect of each Agency vary and are market driven.
However, for the guidance of stakeholders, the Ministry has obtained the costs of issuance of DSCs at the consumer end from the Certification Agencies. The costs as intimated by them are as under:
6. Obtain Digital Signature Certificate
Q3) Briefly explain the directors identification number
A3) DIN- DIRECTIONS IDENTIDICATION NUMBER
Director identification number is a prerequisite for appointment as director during a company in India. Same time Register of Directors and Key Managerial personnel serve the aim of Record of interests of those persons in company and otherwise.
Directors’ Identification Number (SECTIONS 153 – 159)
(Section 153)
Every individual intending to be appointed as director of a company shall make an application for allotment for Director Identification number (DIN) to the Central government.
(Section 154)
The Central government shall within one month from the receipt of the appliance allot a Director number to the applicant.
(Section 155)
No person who already has a Director Identification number shall apply for another Director Identification number.
(Section 156)
Every existing director, within one month of the receipt of Director Number from Central Government, shall intimate the number to all or any the companies where he/she may be a director.
(Section 157)
Every company, within fifteen days of the receipt of intimation from the director, shall furnish the Director Identification number to the registrar. If a company fail to furnish Director identification within a period specified under Section 403, the company shall be punishable with fine which shall not be but twenty-five thousand rupees but which can reach one lakh rupees and each officer of the company who is in default shall be punishable with fine which shall not be but twenty-five thousand rupees but which can reach one lakh rupees.
(Section 158)
Every person or company, while furnishing any return, information or particulars as are required to be furnished under this Act, shall mention the Director identification number in such return, information or particulars just in case such return, information or particulars relate to the director or contain any reference of any director. Where a replica of such resolution is to be furnished somewhere, DIN should be mentioned. Simply, this is often prudent to say DIN in all resolutions.
(Section 159)
If any individual or director of a company, contravenes any of the provisions of section 152, section 155 and section 156, such individual or director of the company shall be punishable with imprisonment for a term which can reach six months or with fine which may extend to fifty thousand rupees and where the contravention may be a continuing one, with an extra fine which may reach five hundred rupees for each day after the first during which the contravention continues.
Q4) What do you mean by e- filing and its process?
A4) E- FILING (SECTION 397 TO 402)
As a part of Annual e-Filing, Companies incorporated under the businesses Act, 1956 are required to e-file the following documents with the Registrar of Companies (RoC)
Balance-Sheet: Form 23AC to be filed by all Companies
Profit & Loss Account: Form 23ACA to be filed by all Companies
Annual Return: Form 20B to be filed by Companies having share capital
Annual Return: Form 21A to be filed by companies without share capital
Compliance Certificate: Form 66 to be filed by Companies having paid up capital of Rs.10 lakh to Rs. 5 crore
Step by Step Process for additional Attachments to form 23AC :
1 If the dimensions of Form 23AC exceed 2.5 MB, remove some attachments or split and attach only a small a part of the attachment to limit the shape size to 2.5 MB. you'll upload the remaining/ other parts of attachments separately using ‘Additional Attachment Sheet’ as below.
2 Download the ‘Additional Attachment Sheet’ from ‘Annual Filing Corner’ link on the homepage of MCA portal.
3 Enter the CIN and click on ‘Pre-fill’ button to automatically fill the name and address of the company within the e-Form.
4 Fill the date of relevant balance sheet.
5 Select the type of document from the dropdown list and click ‘Attach’ button to ‘browse and select’ the file to be attached. You have the option to connect maximum 5 documents.
6 Fill the signatory details i.e. Designation and DIN/ Membership No.
7 Affix the Digital Signature Certificate of the signatory
8 Click ‘Verify’ button. just in case of any error, rectify the same and repeat this step.
9 Close the form and save it again on prompting by the system. Please ensure that size of ‘Additional Attachment Sheet’ doesn't exceed 2.5 MB.
10 If you wish to attach more attachments, please download a fresh Form and repeat the above steps. you have the option to upload maximum two ‘Additional Attachment Sheet’ against one Form 23AC.
11 After uploading of Form 23AC on MCA portal, system will prompt for following options:
12 Select the second option and upload saved ‘Additional Attachment Sheet’.
13 After uploading of 1 ‘Additional Attachment Sheet’, system will again prompt for making a selection. If you have the second ‘Additional Attachment Sheet’ for uploading, select the second option again and upload an equivalent . Otherwise select the first option and upload Form 23ACA to finish the filing and proceed to ‘payment option’ screen.
14 If you have uploaded two ‘Additional Attachment Sheets’ system will prompt you to file Form 23ACA to complete the filing and proceed to ‘payment option’ screen.
How to do the Filing Companies can do e-Filing in three different ways:
1)The company representative can upload the e-Forms on the MCA portal through the ‘Annual Filing Corner’ link (after registering oneself as a user of the portal) at his convenience from his office/ home. this is often the most convenient way of e-Filing.
2)The company representative can prepare the e-Forms as per guidelines, get them digitally signed by the authorized signatory, copy them during a CD or a pen drive and visit the closest “Registrar’s Front Office” (RFO). RFO staff will assist in uploading of e-Forms on MCA portal. For addresses/ phone numbers of RFOs, please ask the “Facilitation Centre” link on the homepage of MCA portal.
3)The company representative also can contact any of the Certified Filing Centers (CFCs) for the Annual Filing of e-Forms by paying the service charges to the CFCs. the details about the CFCs are available under the ‘Certified Filing Centre’ tab on the homepage of MCA Portal.
Q5) Define e governance and also give brief knowledge on it.
A5) In the arena of advanced technology, e-government has distinct place and it facilitates to huge number of customers to perform their task speedily. because the Internet supported digital communities grow, they present the national governments with numerous challenges and opportunities.
E-Governance which also referred to as electronic governance is essentially the application of information and communications technology to the processes of state functioning so as to cause ‘Simple, Moral, Accountable, Responsive and Transparent’ governance (Governance for The Tenth Five Year Plan (2002-2007), planning commission, November, 2001).
E-governance involve the use of ICTs by government organizations for exchange of information with citizens, businesses or other government departments, faster and more efficient delivery of public services, improving internal efficiency, reducing costs / increasing revenue, re-structuring of administrative processes and improving quality of services.
Concept of e-Governance
E governance has gained more popularity in convoluted business world. Many management scholars have described the concept of e governance which is emerging as a crucial activity within the business field.
It is established that E-governance is that the application of information and communication technologies to transform the efficiency, effectiveness, transparency and accountability of informational and transactional exchanges with in government, between government & govt. agencies of National, State, Municipal and native levels, citizen & businesses, and to empower citizens through access & use of information (Mahapatra, 2006).
Use by government agencies of information technologies (such as Wide Area Networks, the internet, and mobile computing) that have the power to transform relations with citizens, businesses, and other arms of state .
These technologies can serve a spread of various ends: better delivery of state services to citizens, improved interactions with business and industry, citizen empowerment through access to information, or more efficient government management. The resulting benefits are often less corruption, increased transparency, greater convenience, revenue growth, and or cost reductions.
-World Bank, on E-governance
A transparent smart e-Governance with seamless access, secure and authentic flow of information crossing the interdepartmental barrier and providing a fair and unbiased service to the citizen.
– Dr. APJ Abdul Kalam
Q6) Write a note on historical review and current position of E Governance.
A6) Historical review and current position of e-governance
It has been documented that within the decade of nineties, there was major Global shifts towards increased deployment of IT by governments due to emergence of the world Wide Web. The technology also as e-governance enterprises have come a long way since then. With the upsurge in Internet and mobile connections, people are learning to utilize their new mode of access in various ways. they need started expecting more and more information and services online from governments and company organizations to advance their public, professional and personal lives.
Q7) What do you mean by winding up of a company?
A7) A private limited company is an artificial judicial person and requires various compliances like appointment of Auditor, regular filing of tax return, annual return filing and more. Failing to take care of compliance for a company could end in fines and/or disqualification of the directors from incorporating another Company. Therefore, if a private Ltd. has become inactive and there are not any transactions within the company, then it's best to finish up the company.
Voluntary winding up of a company are often initiated at anytime by the shareholders of the company. just in case there are any secured or unsecured creditors or employees on-roll, the outstanding dues must be settled. Once all the dues are settled, the bank accounts of the company must be closed. Finally, the company must regularise any overdue compliance like tax return or annual filing and surrender the GST registration. Once, all activities are stopped and therefore the registrations are surrendered, the winding up application petition can be filed with the Ministry of Corporate Affairs.
India Filings can help you wind up your Company, quickly and simply. India Filings can assist you initiate the completing process within 10 to 14 business days. the whole process for winding up of a company are often completed within 3 to six months, subject to government processing times. The timeline for winding up of a company could also differ from case to case, based on unique circumstances. to discuss more about winding up a company, get in-tuned with an India Filings Advisor.
Q8) Explain Winding up of a company by tribunal.
A8) Winding up of a company by tribunal
Winding up of a company may be required due to a number of reasons including closure of business, loss, bankruptcy, passing away of promoters, etc., The procedure for winding up of a company are often initiated voluntarily by the shareholders or creditors or by a Tribunal.
As per Companies Act 2013, a company are often wound up by a Tribunal, if:
1. the company is unable to pay its debts.
2. the company has by special resolution resolved that the company be aroused by the Tribunal.
3. the company has acted against the interest of the sovereignty and integrity of India, the safety of the State, friendly relations with foreign states, public order, decency or morality.
4. The Tribunal has ordered the winding up of the company under Chapter XIX.
5. If the company has not filed financial statements or annual returns for the preceding five consecutive financial years.
6. If the Tribunal is of the opinion that it's just and equitable that be company should be wound up.
7. If the affairs of the company are conducted during a fraudulent manner or the company was formed for fraudulent and unlawful purposes or the persons concerned within the formation or management of its affairs are guilty of fraud, misfeasance or misconduct in connection therewith and it's proper that the company be wound up.
Q9) What is compulsory winding up?
A9) In compulsory completing , a creditor asks the high court to wind up the affairs of an insolvent limited company. This legal process ends with the company's removal from the companies House register - effectively ceasing to exist.
Once the order has been made the high court appoints the Official Receiver (OR) as liquidator. The Official Receiver works for the Insolvency Service and finds out how and why a private became bankrupt or a corporation went into compulsory liquidation.
The OR interviews the directors and informs the creditors of the liquidation. If the OR believes the company has enough assets for something to be paid to its creditors the OR will seek the appointment of an insolvency practitioner as liquidator - either by calling a creditors' meeting for the creditors to vote for the liquidator or by asking the Department for the Economy (DfE) to appoint one. If there are no assets the OR will remain liquidator.
COMPULSORY WINDING UP INVOLVES THE FOLLOWING:
Sources of advice
If you are a creditor, it can be expensive to request a compulsory winding-up order, so you ought to get specialist legal and financial advice before petitioning the Court. Other sources of advice include:
You will need to instruct a solicitor to handle the winding-up petition. A winding-up petition is heard within the high court. The high court may award costs against you if it considers that you simply have brought the petition inappropriately - eg the company disputes the debt between you.
