My company in Kannur has not filed its annual return for the last two years; what penalties apply and how can I regularise the filing?

Detailed Legal Analysis

If your company in Kannur has not filed its annual return for the last two years, it may face penalties as per the provisions of the Companies Act, 2013. To regularize the filing, you will need to take specific steps outlined below.

Under Section 92 and Section 137 of the Companies Act, 2013, every company is required to file its annual return and financial statements respectively. Failure to comply with these requirements can result in penalties.

• Penalties for Non-filing:
  • As per Section 92(5), a company that fails to file its annual return is liable to pay a penalty of ₹100 per day during which the failure continues, subject to a maximum of ₹5 lakh.
  • Under Section 137(3), if the financial statements are not filed, the company may incur a penalty of ₹100 per day, with a cap of ₹10 lakh.
  • Additionally, the company’s officers in default may also be held liable, facing fines that may extend to ₹1 lakh, plus ₹5,000 for every day of continuing default.
• Steps to Regularize Filing:
  • Assess Default: Determine the exact duration of the non-filing and gather necessary documents like the financial statements and annual returns for the two years.
  • Prepare Documents: Ensure that the financial statements are prepared and signed by the directors and audited if applicable.
  • File with Registrar: Use the Ministry of Corporate Affairs (MCA) portal to file the overdue annual return and financial statements. You may need to fill out Form MGT-7 for the annual return and Form AOC-4 for financial statements.
  • Pay Penalties: Be prepared to pay the applicable penalties while filing the returns. The MCA system will calculate the penalties automatically based on the delay.
  • Seek Professional Help: It is advisable to consult with a Chartered Accountant or Company Secretary to ensure compliance and to understand any legal repercussions better.
• Additional Considerations:
  • If the delay is substantial, consider applying for condonation of delay under Section 460 of the Companies Act, 2013, which allows for relief in certain circumstances.

Regularizing your filings is crucial to maintaining good standing and avoiding further legal complications. Take immediate action to ensure compliance with the Companies Act, 2013.