• Notification Date: 24-01-2023
• Notification No: N/A

Company Formation, Conversion made Convenient and Swifter on New MCA Portal

Companies will be able to incorporate and convert with greater ease in version-3 of the corporate affairs ministry portal. A notification dated January 20, has amended the Companies’ Incorporation Rules, 2014 and the companies authorised to register rules, 2014. Instead of a physical copy of Memorandum of Association and Article of Association only an e-MOA and e-AOA will have to be filed in all cases of conversion of companies in the version 3. 

The Ministry of Corporate Affairs has made more than 46 forms available on the latest version-3 of its portal on Monday, for easier and faster method of filing. 

When converting a one-person company into a public or private one, a single form, INC, has to be filled along with the e-MOA, e-AOA. The requirement of filing a copy of resolution, list of proposed members and directors, list of creditors and latest audited financial statement have been done away with. 

The registrar of companies would issue a certificate of incorporation for such conversions after examining the latest audited financial statement in MCA records. For the conversion of the existing firm into a section 8 company, the entity shall file an application in Form INC-12. Ankit Singhi, partner, Corporate Professionals said that companies need no longer submit estimates of future annual income and expenditure for three years and two years of financial statements, board’s report among other things. “An intimation along with the application filed with the regional director shall be shared with the Registrar of Companies through the MCA system. Previously, it was required to be filed separately with the RoC.” 

If a limited liability partnership (LLP) or partnership firm, society or trust convert into a company, then they are no longer required to file written consent of members, an undertaking of the proposed directors for the compliance of the Indian Stamp Act and details of the objects along with a declaration from all the members about the compliance of restrictions. 

Applicants are not required to submit a separate copy of the application for shifting of registered office from one state to another with the registrar of companies. Instead, in the version 3, an intimation of the application filed with the regional director shall be shared with the registrar of companies through the MCA system. 

Enhanced disclosures for disqualification 

In another notification the government has enhanced the disclosures in case of disqualification of directors. “Every director shall now inform the concerned company about his disqualification under Section 164(1) & (2) in Form DIR-8 before his appointment or re-appointment,” said MCA.  

Earlier the requirement was only in cases when disqualification happened due to non-filing of financial statements or annual returns for any continuous period of three financial years. However, now the disclosure will have to be made if disqualification occurs because the director was found to be of unsound mind or undischarged insolvent among other criteria. 

MCA has also said that, whenever a company receives the aforementioned intimation, it shall file Form DIR-9 with RoC within 30 days of such receipt. “Any application for removal or disqualification of directors shall be filed before the Regional Director in Form DIR-10,” MCA said.