MCA Update: Compulsory Demat rules not applicable to Nidhi Co, Govt Co and WOS

Ministry of Corporate Affairs (MCA) has exempted such unlisted public companies, which are Nidhi Companies, Government Companies and Wholly Owned Subsidiary Companies, from complying with compulsory dematerialisation rules

Ministry of Corporate Affairs (MCA) issued a notification dated 22nd January, 2019 to alter Companies (Prospectus and Allotment of Securities) Rules, 2014 by adding a sub-rule to Rule 9 which states that all unlisted public companies are required to demat all its shares before 01st April, 2019.

This new sub-rule is giving an exemption to all unlisted public companies which are Nidhi Companies, Government Companies and Wholly Owned Subsidiary Companies from compliance of Rule 9 of such rules. This means that physical shares of such companies can still be transferred without dematerialisation even after the deadline of 01st April, 2019. Such companies are not required to do compliance of Rule 9.

Copy of Notification can be accessed below:

Plastic Products Business

Main Object Clause of an entity having business of Plastic, Polymeric products and materials (Avon Moldplast Limited)

1. To  carry  on  the  business  of  buying,  selling  reselling  and trading  of  all  kinds  of  goods  finished,  semi-finished, raw material items, articles, merchandise, products such as agricultural, industrial, chemical or marine, stones, pieces of arts antiques, handicrafts, machinery, equipments, capital goods and any other  items  capable  of  purchasing  selling,  importing,  exporting  and  trading  and  to  be  appointed  as agents and/or distributors or commission, allowance, retainer ship, incentive basis.

2. To  carry  on  the  business  of  exporters  and  importers,  selling  agents,  stockist,  merchants  and manufactures representatives, dealers of all kinds of consumer durable, consumer or industrial goods, garments engineering goods of any description and nature.

3. To  carry  on  the  business  of  Manufactures,  producers,  buyers,  sellers,  importers,  exporters,  dealers, Agents, and distributors of local and foreign Companies in the following areas:

a. Plastic and polymeric materials of all kinds including molded articles like furniture, brief/suitcases etc. Monomers, Processed Semi Finished plastic of all kind, polymeric foams, PET granules of all grades  and  master  Batches  for  plastic,  PVC  Materials  and  other  allied  products  including  the manufacture of bottles and other containers of our of PET, PVC and other materials belonging to the same family, including the processing of secondary grade plastic.

b. RESINS AND COMPONDS, Anti fibrillant Master Batch, Colour Master Batches, Reinforced Plastics, Engineering  Plastics,  Reprocessing  of  Plastics,  Additives  Pigments,  Fillers  and  Chemicals,  of Plastics, Polymeric Materials, Processed Semi Finished Plastic of all kind of allied products.

4. To carry in India or elsewhere the business to manufacture, process, produce formulate, mix, disinfect, clean, wash, dilute, dye, concentrate, compound, segregate, pack, repack, add, remove, heat, grade, design,  develop,  distribute,  display,  melt,  improve  mould  blow,  extrude,  draw,  derive,  discover, fabricate,  treat,  work,  manipulate,  prepare,  promote,  supervise,  supply,  import,  export,  acquire, barter, store, forward, buy, sell, turn, to account market, and to act as agent, broker, representative, concessionaries, consultant, collaborator, franchiser, job worker or otherwise to deal in all varieties, characteristics,  descriptions,  strength,  applications,  colour  and  users  of  plastic  goods  and  materials including lumps, powders, pipes, films, tubes, fibers, laminates granules, sheets, blocks, chips, flakes, bars or other allied goods, articles and things their compounds, by-products, co-products, formulations, intermediaries,  ingredients,  residues,  mixtures  and  blends  made  of  PVC,  nylon,  HDPE, LDPE,  LLPDE, polystyrene, polymers, monomers, elastomers, resins, polysters and other allied chemicals.

5. To  carry  or  in  India  or  elsewhere  the  business  to  manufacture,  produce,  process,  convert, commercialize,  design, develop, display, discover, mould, remould, blow extrude, draw, dye, equip, fitting up,  fabricate,  manipulate,  prepare,  promote,  remodel,  service,  supervise,  supply,  import, export, buy, sell turn to account and to act as agent, broker, concessionaries, consultant, collaborator, consignor,  job-worker,  export  house  or  otherwise  to  deal  in all  shapes,  sizes,    varieties,  colour, capacities,  modalities,  specification,  descriptions  &  applications  of  systems,  novelties,  substitutes, households, kitchenware, sanitary ware, toys, ropes, gift articles, building materials, monofilaments, pipes,  furniture,  baggage’s,  hardware’s,  sheets,  films,  laminations  etc.  used  in  industries,  trade, commerce,  utilities,  hospitals,  transports,  aviation,  defence,  entertainments,  hotels,  house  stores, agriculture, packing, electrical & electronics and other allied fields whether made of plastics, plastics scraps, HDPE, PVC, LDPE, LLPDE, Polymers, co-polymers, monomer, elastomers, resins, polyesters and other allied materials with or without combinations of other ferrous or non-ferrous materials

Appointment of First Auditor in General Meeting by Members - OR

Ordinary Resolution passed at a General Meeting appointing the First Auditor(S) where board fails to appoint within thirty days of Incorporation date

“RESOLVED THAT pursuant to provisos to Sub-section (6) of Section 139 of the Companies Act, 2013, Shri _________, Chartered Accountant, _________, be and is hereby appointed as the auditor of the company to hold office until the conclusion of the first Annual General Meeting on a remuneration of `________ plus reimbursement of out-of-pocket expenses that may be incurred by the auditor in the performance of his duties as auditor of the company."

Explanatory Statement;

The company was registered on ________. The Board of directors of the company failed to exercise its power under Sub-section (6) of Section 139 of the Companies Act, 2013 within thirty days of the date of registration of the company and did not appoint the first auditor of the company.

Therefore, in exercise of its power under the proviso to Sub-section (6) of Section 139 of the Act, the company may appoint the first auditor of the company by passing the proposed ordinary resolution as set out in the notice of the meeting.

None of the directors of the company is concerned or interested in the proposed resolution.

Appointment of Auditor to fill casual vacancy caused by resignation - OR

Ordinary Resolution for appointment of an Auditor of the Company to fill casual vacancy caused by resignation

“RESOLVED THAT, pursuant to proviso to Sub-section (8) of Section 139 of the Companies Act, 2013, M/s________________ Chartered Accountants ____________, New Delhi, be and are hereby appointed as the auditors of the company to fill the vacancy caused by the resignation of M/s___________ Chartered Accountants, ____________ New Delhi, present auditors of the company, to hold the office from the date of this meeting until the conclusion of the next annual general meeting of the company on a remuneration of _________ plus reimbursement of out-of-pocket expenses that may be incurred by the auditors in the performance of their duties as auditors of the company.”

Explanatory Statement

M/s. ______________, the existing auditors have submitted their letter of resignation, citing personal reasons.

Proviso to Section 139 (8) of the Companies Act, 2013, lays down that where vacancy in the office of an auditor is caused by the resignation of the existing auditor, the vacancy shall be filled by the Board of Directors and the appointment made by the Board shall be approved in a general meeting within 3 months of the recommendation of the Board.

The letter of resignation of M/s._____________ may be inspected at the registered office of the company at_____________ during the business hours on any working day.

None of the directors is interested or concerned in the proposed resolution.

Authorising Board of Directors to appoint Branch Auditor - OR

Ordinary Resolution to be passed at an Annual General Meeting to authorise Board Of Directors to appoint Branch Auditor

“RESOLVED THAT pursuant to section 143(8) of the Companies Act, 2013, the accounts for the year ending 31^st  March, _____ of the Company’s branch office/s at _______ be audited by such person/s, other than the Company’s Auditor, as is/are qualified for appointment as Auditor of the Company under section 139 of the Companies Act, 2013, and the Board of Directors be and is hereby authorised to appoint such Branch Auditor/s in consultation with the Company’s Auditor and on such terms and conditions and on such remuneration as may be fixed by the Board.

Approval for preparing Annual Report in Form AOC-3 - BR

Board Resolution for approval for preparing Annual Report in Form AOC-3 for sending to the members

“RESOLVED THAT pursuant to the provisions of First proviso of sub – section (1) of Section 136 of the Companies Act, 2013 and Rule 10 of the Companies (Accounts) Rules 2014, the Annual Reports comprising of the Balance Sheet, Profit and Loss Account etc. of the company for the financial year ended 31st March _____ be also prepared, finalised and audited in the prescribed Form No AOC – 3 for sending to the members of the company.

RESOLVED FURTHER THAT the draft audited statement containing salient features of financial statements for the year ended 31st March 20__, prepared in the prescribed Form No. AOC – 3 in accordance with First proviso of sub – section (1) of Section 136 of the Companies Act, 2013 and Rule 10 of the Companies (Accounts) Rules, 2014 as submitted to the meeting, be and are hereby approved and the same be authenticated by the directors of the company as required under Section 136 of the Act and be sent to the statutory auditors of the company for their report thereon and thereafter be sent to the members of the company for adoption at the ensuing annual general meeting of the company.”

Keeping Books of accounts at a place other than Registered office - BR

Board Resolution for keeping and maintaining books of Accounts at a place other than the Registered Office

“RESOLVED THAT pursuant to the proviso to Section 128(1) of the Companies Act, 2013, the books of accounts of the company be kept and maintained at the company’s head office at __________ with effect from ____________ and that Mr. ____________, secretary of the company, be and is hereby authorised to file electronically E-Form No AOC-5 with the Registrar of Companies __________ at ______________ by affixing his digital signature thereon and with the requisite filing fees within the prescribed time of seven days hereof and to take all necessary actions in this respect.”