Exemptions to Private Companies

Ministry of Corporate Affairs (MCA) vide Notification dated 13^th June, 2017 hereby amends its Notification no. G.S.R 464 (E) dated 5^th June, 2015 (Principal Notification).

The private companies will not be eligible to claim the following exemptions alongwith those specified in Principal Notification, if they have defaulted in filing of financial statements or annual returns under section 137 and section 92 respectively with Registrar.

Section	Earlier	Amended
2(40)	Cash Flow statement is not mandatory for: ·         One person Company ·         Small Company ·         Dormant Company	Cash flow statement is not mandatory for: ·         One person Company ·         Small Company ·         Dormant Company ·         Start-up Company (Private company)
Clause  (a) to (e) of Section 73(2)	Shall not apply to a Private company which accepts from its members monies not exceeding 100% of aggregate of paid up share capital and free reserves	Shall not apply to a Private company- (A)    which accepts from its members monies not exceeding 100% of aggregate of paid up share capital, free reserves and securities premium account’, or   (B)    which is a start up for 5 years from the date of its Incorporation or (C)    which fulfils all of the following conditions: (a)      which is not an associate or subsidiary company of any other company   (b)      If the borrowings of such a company from Banks or Financial institutions or any Body corporate is less than twice of its paid up share capital or 50 Crore rupees, whichever is lower; and (c)      Such a company has not defaulted in the repayment of such borrowings subsisting at the time of accepting deposits under this section Provided that the company referred to in clauses (A), (B) or (C) shall file the details of monies accepted to the Registrar in such manner as may be specified.".
92(1)(g)	Every company including small company requires to provide details of Remuneration of directors and Key Managerial Personnel in its Annual return.	Now, small companies are required to disclose the details of remuneration of directors only.
92(1)	In relation to One Person Company, small company, the annual return shall be signed by the Company Secretary and if there is no Company Secretary, by the Director of the company	Now in addition to One Person Company and  Small company, Private Company which is a start up , the annual return shall be signed by the Company Secretary and if there is no Company Secretary, by the Director of the company
143(3)(i)	The Auditors report shall also state: (i) whether the company has adequate Internal Financial Controls system in place and the operating effectiveness of such control	Clause (i) shall not be applicable to private companies which is: ·         One Person Company; or ·         Small Company; or ·         Having turnover less than 50 Crores as per latest audited financial statements; or ·         Having aggregate borrowings less than 25 crores from banks or financial institutions or any body corporate at any point of time during the financial year
173(5)	One Person Company (OPC) or Dormant Company or small company shall conduct at least one meeting of board of Directors in each half of the calendar year and the gap between the two meeting is not less than 90 days	Alongwith OPC, dormant and small company, this section shall also apply to Private company which is a start up
174(3)	Earlier the same provision is inserted in section 184(2)	Now the same has been inserted in Section 174(3) Interested director may also be counted towards quorum in such meeting after disclosure of his interest pursuant to section 184