Tuesday 31 May 2016

Penalty for late filing or failure to file Company’s annual return – Form MGT-7

Penalty for late filing or failure to file Company’s annual return – Form MGT-7

Company’s annual return is to be filed with registrar of companies within 60 days from the date of annual general meeting. Where annual general meeting has not been held for the year then within 60 days from the date on which AGM should have been held.

In this article, we will discuss normal fees that every company is required to pay while filing annual return in form MGT7 with registrar of companies and penalty that gets attracted in case of delay in filing or failure to file company’s annual return. From financial year 2014-2015 onwards, form MGT7 has to be filed in place of form 20B.

Additional fees to be paid for filing of company’s annual return

Additional fee gets attracted when company has crossed the due date of filingi.e. 60 days from the date of AGM and when AGM not held then 60 days from the date when AGM should have been held.
Additional fee is to be paid in addition to normal fee and gets calculated based on the days of delay and normal fees applicable.

Period of delay Additional fee or penalty for late filing annual return or form MGT-7

Delay up to 30 days
2 times of normal fee
More than 30 days and up to 60 days
4 times of normal fee
More than 60 days and up to 90 days
6 times of normal fees
More than 90 days and up to 180 days
10 times of normal fees
More than 180 days
12 times of normal fees

Penalty in addition to additional and normal fee for filing annual return

 Like any other penalty provision, not filing or late filing of company’s annual return also attracts additional penalty and late payment fee. Such penalty provision is specified in section 92(5) of Companies Act, 2013.

As per section 92(5) of Companies Act 2013, if a company fails to file its annual return under sub-section (4), before the expiry of the period (270 days from the date by which it should have been filed) specified under section 403 with additional fee then the company shall be punishable with fine which shall not be less than 50,000 rupees but which may extend to 5 lakh rupees and every officer of the company who is in default shall be punishable with imprisonment for a term which may extend to 6 months or with fine which shall not be less than 50,000 rupees but which may extend to 5,00,000 rupees or with both.

CS Khusboo
8790418875


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