Requirement – MGT – 9 BIG QUESTION (?)
Requirement – MGT – 9
BIG QUESTION (?)
Since
previous some days many professionals are confused in respect of one question i.e.
“Whether
MGT-9 is required to be preparing for F.y. 2017-18 or not”.
As per CA, 2013 section 134, Companies was required
to prepare MGT-9 extract of Annual Return and such MGT-9 was required to file
with Directors Report.
However, this provision has been
amended by CAA, 2017 w.e.f. 31.7.2018 i.e. as per notification dated 31st
July, 2017 provision in relation to MGT-9 has been removed from Section 134 and
a new provision I added i.e. “the web address, if any, where [1]Annual Return referred to in
sub-section (3) of section 92 has been placed”.
Therefore, According to Section 134 one can opine that MGT-9
is not required to prepare by any Company if Directors Report approved in Board
Meeting on or after 31st July, 2018.
Confusion: Section 134 is clear that extract of Annual Return has been
removed from this section However; Section 92 is the reason behind confusions.
Because, Section 92 read with rule 12 states that “The extract of the annual return to be attached with the Board’s Report
shall be in Form No. MGT.9”
Now the actual
question arise that Section 134 states that if Company having web address, it
shall publish Annual Return on its website. Other side Section 92 rules 12
states about Extract of Annual Return.
Now Following Questions Arise:
1) Whether Companies required preparing MGT-9 after 31st July,
2018?
2)
Whether
Companies are required to comply both Section 92 and Section 134?
3)
While
complying Section 134, MGT-9 required being published on website of Company or
Annual Return i.e. MGT-7 required publishing on website of Company?
4)
If
Company doesn’t having website in such case whether MGT-9 required or not?
5)
If
section 92 notified as suggested by Companies Amendment Act, 2017. Whether
MGT-9 shall be part of Companies Act, 2013 or not?
A. Whether Companies are required to prepare MGT-9?
As per CA, 2013
section 134, Companies was required to prepare MGT-9 extract of Annual Return
and such MGT-9 was required to file with Directors Report.
However, this
provision has been amended by CAA, 2017 w.e.f. 31.7.2018 i.e. as per
notification dated 31st July, 2017 provision in relation to MGT-9 has been
removed from Section 134 and a new provision I added i.e. “the web address, if
any, where annual return referred to in sub-section (3) of section 92 has been
placed”.
First
School of Thought:
Therefore, one can
opine that MGT-9 is not required to prepare by any Company if Directors Report
approved in Board Meeting on or after 31st July, 2018.
Second
School of Thought:
Second view is that amendment
proposed in Section 92 still not notified and section 92 Rule 12 states about
Extract of Annual Return i.e. MGT-9 therefore, still preparation of MGT-9 is
required.
B. Whether Companies are required to comply both Section 92 and Section 134?
As per second School of thought, Company is
required to prepare MGT-9 because this is requirement under Section 92 read
with rule 12.
|
Section 134
(notified w.e.f. 31.07.2018)
|
Section 92
Notified w.e.f. 01st April, 2014
|
|
the web address, if any, where annual return referred to in sub-section
(3) of section 92 has been placed.
|
The extract of the
annual return to be attached with the Board’s Report shall be in Form No. MGT.9
|
However, above
mentioned both the sections are in force as on date. Therefore, one can opine
that after 31st July, 2018 till the date of notification of amended
section 92. Company has to comply
with provisions of both Sections 92
and 134. Company
have to prepare MGT9 and required to publish annual return i.e. MGT-7 on
website of Company, if any.
C. While complying Section 134, MGT-9 required being published on website of
Company or Annual Return i.e. MGT-7 required publishing on website of Company?
As per requirement of
Section 134, if Company having website in such case it is required to publish
ANNUAL RETURN i.e. (MGT-7) on its website.
Therefore, it is very
clear that while complying with the provision of Section 134 (Board Report) company
have to publish the ANNUAL RETURN i.e. (MGT-7) on its website.
Practically, MGT-7
annual return prepared after Annual General Meeting and Board Reports prepare
before General Meeting in such Case Companies can give link on its Directors’
Report that annual return of Company once prepare shall be publish on the given
web address.
D.
If Company doesn’t having website in
such case whether MGT-9 required or not?
First thing as per
Section 134 MGT-9 has been substitute by deletion of MGT-9 from Section.
Therefore, one can
opine that in the case where a company doesn’t having website “it can mention
in Directors Report that Company is not having website therefore no need
publish annual return”.
E. If section 92 notified as suggested by Companies Amendment Act, 2017.
Whether MGT-9 shall be part of Companies Act, 2013 or not?
Once section 92 as amended
by Companies Amendment Act, 2017 notified then MGT-9 shall be fully removed
from the Companies Act, 2013.
Link for
Draft Directors Report:
FAQ’s
Annual Filing:
http://www.csdiveshgoyal.info/2018/08/faqs-annual-filing-company-law-series-1.html
(Author – CS Divesh
Goyal, GOYAL DIVESH & ASSOCIATES Company Secretary in Practice from Delhi
and can be contacted at csdiveshgoyal@gmail.com). Disclaimer: The entire
contents of this document have been prepared on the basis of relevant
provisions and as per the information existing at the time of the preparation.
Although care has been taken to ensure the accuracy, completeness and
reliability of the information provided, I assume no responsibility therefore.
Users of this information are expected to refer to the relevant existing
provisions of applicable Laws. The user of the information agrees that the
information is not a professional advice and is subject to change without
notice. I assume no responsibility for the consequences of use of such
information. IN NO EVENT SHALL I SHALL BE LIABLE FOR ANY DIRECT, INDIRECT,
SPECIAL OR INCIDENTAL DAMAGE RESULTING FROM, ARISING OUT OF OR IN CONNECTION
WITH THE USE OF THE INFORMATION
[1] First thing we should focus that word “Extract of Annual
Return” has been replaced by “Annual Return”, therefore, MGT-9 has been
replaced by MGT-7.
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