CAN MCA ISSUE A CIRCULAR CLARIFYING THAT WITHOUT THE APPOINTMENT OF A COMPANY SECRETARY & KMPs , ELIGIBLE COMPANIES MAY NOT BE ABLE TO PROCEED WITH FURTHER STATUTORY FILINGS AND COMPLIANCE SUBMISSIONS WITH ROC AS IT IS PRACTICED IN NEPAL

CAN MCA ISSUE A CIRCULAR CLARIFYING THAT WITHOUT THE APPOINTMENT OF A COMPANY SECRETARY & KMPs , ELIGIBLE COMPANIES  MAY NOT BE ABLE TO PROCEED WITH FURTHER STATUTORY FILINGS AND COMPLIANCE SUBMISSIONS WITH ROC AS IT IS PRACTICED IN NEPAL

WHAT IS IN PRACTICE IN NEPAL?

The Office of the Company Registrar (OCR) has mandated the appointment of a Company Secretary for companies having committed or paid-up capital exceeding NPR 1 crore during the critical period of the fiscal year.

Without the appointment of a Company Secretary, companies will not be able to proceed with further statutory filings and compliance submissions before the OCR.

Companies falling within this threshold should ensure timely appointment to avoid delays in annual compliance and regulatory filings.

NEPAL MODEL

In Nepal, the Office of Company Registrar follows a stricter compliance regime where companies required to appoint a Company Secretary may face difficulties in processing certain filings if the position remains vacant. This approach encourages continuous compliance rather than merely imposing penalties.

WHAT IS IN PRACTICE IN INDIA

In India, the mandatory appointment of a whole-time Company Secretary (CS) is governed by Section 203 of the Companies Act, 2013 and Rules 8 and 8A of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

In India, the Ministry of Corporate Affairs (MCA) does not bar companies from making statutory filings with the Registrar of Companies (RoC) simply because they have not appointed a Company Secretary. 

The Companies Act, 2013 mandates appointment of a Company Secretary only for certain classes of companies (e.g., listed companies and public companies with paid-up share capital of ₹10 crore or more), 

but filings can still be made by directors or other authorized professionals. This is different from Nepal, where stricter practice requires a Company Secretary for filings.

BAN ON FILING STATUTORY FORMS

FOR THE STRICTER COMPLIANCE, WILL THE MCA COME FORWARD TO ISSUE A CIRCULAR IF KEY MANAGERIAL PERSON IS not appointed ( Company Secretary, independent director , CFO or women independent director) these companies LIKE listed companies and public companies with paid-up share capital of ₹10 crore or more with ROC concerned. are  NOT allowed to  File statutory forms .

This will make the companies to see that KMPs are appointed regularly and if any failure on the part of Indian companies may not able file statutory forms with MCA. 

POTENTIAL CHALLENGES

• Companies may become unable to file annual returns or financial statements, leading to cascading defaults.

• Genuine cases involving resignation, death, incapacity, or delays in recruitment may be adversely affected.

• Such restrictions could conflict with the objective of facilitating compliance.

• validity may be questioned unless supported by amendments to the Companies Act or Rules.

KEY TAKEAWAYS

MCA can strengthen enforcement of Section 203 through MCA21 portal controls and rule amendments. 

However, a complete prohibition on statutory filings solely through a circular would likely exceed the scope of a clarificatory circular and may require amendments to the Companies Act, 2013 or the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. A balanced approach that encourages compliance without creating additional defaults would be more sustainable and legally robust.

# Your Compliance expert R V SECKAR , FCS ,  LLB 79047  19295