Form MGT-8 Applicability

Annual returns are a basic compliance obligation under the Companies Act, 2013, for every registered Indian business. The official documents reflecting the financial situation and business activities of the company for a given financial year are the annual accounts, corporate governance report, and compliance reports. The Annual Return reveals crucial information to the Registrar of Companies (ROC), therefore guaranteeing corporate governance openness and accountability. Prompt and correct filing helps the company maintain its Legal standing and prevents penalties or lawsuits resulting from not fulfilling the requirements of legislative reporting obligations.

What is Form MGT-8?

Form MGT-8 is a compliance certificate under Section 92(2) of the Companies Act, 2013 and Rule 11(2). According to Rule 11(2) and the Companies (Management and Administration) Rules, 2014, it is duly signed by a Practising Company Secretary (PCS). This certification assures compliance and is correct, complete, and conforms to all legal requirements of a company’s Annual Return (Form MGT-7 or MGT-7A). MGT-8 is required of all public and unlisted companies with a paid-up share capital of ₹10 crore or more or a turnover of ₹50 crore.

Before this certificate is issued, the PCS considers several factors, including director meetings, stock ownership, and statutory filings. It supports openness and accountability in company operations by offering an independent professional perspective on compliance. MGT-8 should include the Annual Return, which must be sent to the Registrar of Companies (ROC) within 60 days of the Annual General Meeting (AGM).

Applicability of Form MGT-8

Form MGT-8 is a professional warranty seal of a company’s compliance and is essential for all listed as well as unlisted companies that cross the given financial thresholds to ensure transparency, accountability, and good corporate governance in accordance with the Act.

Form MGT-8 has to be certified and filed by the following parties:

• Listed Companies: All listed companies, regardless of their paid-up share capital or turnover, must obtain MGT-8 certification from a professional Company Secretary.
• Other companies: Form MGT-8 also applies to unlisted companies that have any of the following:
• Paid-up share capital of ₹10 crore or more.
• Turnover of ₹50 crore.

As such, any private company or public unlisted company which crosses either of these thresholds will be required to have its Annual Return (MGT-7 or MGT-7A) attested by a PCS through Form MGT-8.

Exemptions

MGT-8 is not needed for:

1. small companies [as specified in Section 2(85)]
2. One-Person Companies (OPCs).
3. Unlisted companies with paid-up capital not exceeding ₹10 crore and turnover not exceeding ₹50 crore.
4. Private limited companies falling below the above thresholds.

Section 92(1) requires that the annual returns of the said companies be authorised by a Director or Company Secretary.

Documentation

The proper maintenance and availability of documents make easy certification possible and show a company’s best-in-class governance and legal compliance position according to the Act.

1. Statutory Registers & Records

The PCS shall evaluate and validate the following statutory registers and books required under the Act:

• Register of Members (MGT-1) comprises verification information with respect to shareholders, their holdings, transfers, and folio numbers.
• Register of Directors and Key Managerial Personnel (KMP) is used to authenticate appointments, resignations, and the present directorship.
• Register of Charges (CHG-7) provides assurance that all charges created, altered, or discharged are properly recorded and reported to the ROC.
• Register of Debenture Holders (if applicable) for debt issue and holder verification.
• Minute Book (Board and General Meetings) to ensure accurate recording of meetings and resolutions made.
• Registers of attendance to confirm quorum and attendance at Board and General Meetings.
• Register of Contracts and Arrangements (MBP-4): Validates related party transactions in Sections 184 and 188.
• Register of Loans, Guarantees, Investments (MBP-2) to validate compliance with Section 186.
• Renewed and Duplicate Share Certificates Register (SH-2) is used to validate any reissuance or replacement of share certificates.

2. Corporate Governance Documents

The PCS has to assess critical corporate governance and constitutional documents, such as:

• Memorandum and Articles of Association (MOA & AOA) to confirm authorised capital, object clauses, and internal governance requirements.
• The Certificate of Incorporation and Commencement of Business (INC-20A) is meant to authenticate the status of the company.
• Board Resolutions: Appointing directors, auditors, Key Managerial Personnel (KMPs), borrowing, and transactions with relatives.
• Use Share Certificates and Allotment Documents to verify issuance, transfers, and buybacks.
• Verify the last year’s annual returns (MGT-7, MGT-7A, and MGT-8) by complete cross-verification.
• Auditor’s Report and Financial Statements (AOC-4)
• Evidence of submission of ROC forms (AOC-4, ADT-1, DIR-12, PAS-3, etc.)

The PCS needs to be furnished with a list of shareholders and beneficial owners and any relevant SBO disclosures required under Section 90.

3. Financial and Compliance Filings

In order to ensure the authenticity of MGT-8 certification, the PCS is to verify the compliance of financial records and documents –

• A balance sheet, profit and loss account, and cash flow statement for the respective financial year should be submitted.
• Audited accounts adopted at the Annual General Meeting (AGM).
• Statutory and Secretarial Auditors’ Audit Reports (where applicable under Section 204).
• Statement of declared and paid dividends, as well as registers of unpaid/unclaimed amounts.
• Details relating to loans, guarantees, and investments granted in terms of Section 186.
• Section 188 regarding related party transactions (RPTs) compliance.

4. Records of Meetings and Resolutions

Verification is a must to confirm if meetings were properly convened, held, and minuted as per the Companies Act, 2013 and Secretarial Standards (SS-1 & SS-2).

5. ROC and MCA filings

The PCS has to carefully cross-check all the statutory filings with the Registrar of Companies (ROC) to guarantee that the company is in compliance and is updated.

6. Directors’ Details and Shareholding

• List of Directors and their DINs
• Change in Directorship during the year (appointments, resignations, disqualifications)
• Details of KMPs and remuneration
• Shareholding pattern as on year-end
• Transfers, transmissions, and allotments of shares
• Change in share capital, if any (bonus issue, buy-back, right issue)

7. Other Documents

Depending on the nature of the company’s organization, the following documents might be needed:

• Regulatory Body Approvals (RBI, SEBI, FEMA, etc.) – if applicable.
• FEMA filings for foreign investments or remittances.
• Reports of CSR Committee and spending (if Section 135 applicable).
• Registers of Employee Stock Options (ESOPs) or debentures – if any.
• Penalty or compounding cases under the Act or other legislation – details thereof.
• Section 164(2) Declaration by Directors (non-disqualification).

8. PCS Verification and Certification Process

Following verification of all the above documents, the PCS has to provide a certification after independent verification of all filings and records, compliance with all relevant laws, with their COP number and membership number.

Process of Filing Form MGT-8

1. Evaluate Applicability: Check if the company is listed or unlisted and has a paid-up share capital of ₹10 crore or a turnover of ₹50 crore.
2. Arrange for a Practising Company Secretary (PCS) to examine statutory records and authenticate the Annual Return.
3. Prepare Annual Return (MGT-7/MGT-7A): The company’s Annual Return includes information on shareholdings, directors, and meetings.
4. Provide the PCS with the documents required, like statutory registers, ROC filings, minutes, and balance sheets, for verification.
5. PCS Verification: Each document is thoroughly vetted to comply with the Companies Act, 2013 and relevant regulations.
6. PCS Certification: The PCS imposes a digital signature on Form MGT-8, along with its membership and COP number, to establish its correctness.
7. Stamp the certified MGT-8 to Form MGT-7/MGT-7A before submission on the MCA portal.
8. Submission to ROC: The firm submits the Annual Return (MGT-7/MGT-7A) along with the attested MGT-8 on the MCA portal within 60 days from the AGM.
9. Acknowledgement: Successful submission generates an SRN (Service Request Number) as well as an acknowledgement receipt as evidence of submission.

Due Date of Form MGT-8

The Annual Return’s (Form MGT-7 or MGT-7A) filing date matches that of Form MGT-8. It must be signed by a practising company secretary and is to be submitted together with the Annual Return before the Registrar of Companies (ROC). According to the Companies Act of 2013, the Annual Return is to be submitted within 60 days from the Annual General Meeting (AGM) date, which also corrects the MGT-8’s effective due date.

Consequences of Non-Compliance

Non-compliance with the provisions of Form MGT-8 results in penalties as mandated under Section 92(5) of the Companies Act, 2013. If a company that is required to obtain MGT-8 fails to do so or files an uncertified Annual Return, the penalty will be imposed on both the firm and its defaulting officers. The firm can be charged a fine of ₹10,000, with a further ₹100 for every day that default persists (up to ₹2 lakh for the firm and ₹50,000 per officer). This default also destroys the reputation of business governance and can instigate an inspection by the ROC or legal action.

Conclusion

Form MGT-8 has a crucial role to play in infusing transparency, accuracy, and compliance with law into an organisation’s annual reporting format. It functions as an impartial certification by a Practising Company Secretary, asserting that the company has complied with the provisions of the Companies Act, 2013 and related regulations. By requiring professional affirmation, the form encourages corporate accountability and good governance. Early preparation and filing of MGT-8 not only boosts a company’s image but also helps avoid fines, thus guaranteeing law and regulation compliance in business operations.