Change object/activity

Changing Company Name & Objectives - A Smooth Transition with Fincto

As your company expands, it’s crucial to align new opportunities with your vision. To make changes, amend your Memorandum of Association and complete necessary formalities. Fincto offers a seamless service to simplify the process, allowing you to transition smoothly into a new phase

Reasons to Change Business Objectives

A thorough checklist is crucial for a smooth and efficient winding up of a company.Here are the key steps to take:

Undertaking New Ventures

As your company expands into new areas and markets, it's crucial to adjust your objectives to align with the evolving business scope

Company Takeover

When a new company takes over, it can lead to significant changes, altering the company's direction and vision, necessitating updates to its objectives

Eliminating Abandoned Activities

Over time, some company activities may become obsolete, making it crucial to update company objectives to reflect these changes

Banned or Prohibited Activities

Changes in government policies may render certain activities illegal or restricted. To comply with regulations and avoid legal consequences, updating the company objectives is necessary

Government fees and stamp duty depend on the authorised capital of the company.

Process for Changing the Company Objectives

The process for changing the company objectives involves five key steps:

Step 1: Board Resolution

The company's name and objectives will be altered through a board meeting, with a director or secretary appointed to sign and certify the necessary documents

Step 3: File Form MGT-14 with RoC

File Form MGT-14 with the RoC, along with the necessary documents, to process the changes

Step 5: Incorporation of the MoA Object Clauses

After receiving the new incorporation certificate, update the object clause in all copies of the MoA

Step 2: Special Resolution in EGM

The committee is planning to hold an Extraordinary General Meeting (EGM) to approve changes, ensuring all members are given proper notice and their responses are collected

Step 4: Issuance of Fresh Certificate of Incorporation

If the Company Identification Number (CIN) changes due to a change in the industry code, the RoC will issue a new certificate of incorporation to the company

Documents Required for Changing Main Objectives of Business

To initiate the company liquidation process in India, you will need the following documents:

Notice regarding EGM
Attested true copy of the special resolution
Minutes of the board meeting and EGM
Altered MoA
Certified true copy of the board resolution (optional)
ID proof of all company directors
Address proof of all company directors
Attendance sheet or register of board meetings and general meetings

Benefits of Company Liquidation

To increase the authorised share capital, the following documents must be filed with the MCA within 30 days of obtaining consent from shareholders:

Freedom from Debts

Liquidation grants directors and company personnel relief from creditor obligations and pressures once the process is complete.

Legal Protection

By voluntarily approving the resolution, directors can avoid legal actions initiated against the company, allowing them to focus on new commercial opportunities.

Cost-Effectiveness

Liquidation expenses are relatively lower as they are primarily associated with the sale of assets.

Lease Cancellation

All lease agreements signed by the company will be terminated during liquidation, along with their terms and conditions.

Advantages for Creditors

Creditors benefit from the liquidation process as they are eligible for payment related to the proposed credits provided by all creditors.

In India, a private limited company can be wound up through two modes:

Directors must submit KYC information to MCA if they meet recent updates.

Voluntary Winding Up

Initiated by a special resolution or a resolution passed in a general body meeting, voluntary winding up can be prompted by violating the provisions and conditions of the Memorandum of Association (MOA).

Compulsory Winding Up

This mode involves winding up the company at the court's command, following a specific resolution passed by the directors or through a petition filed by an official, or if the company engages in illegal or fraudulent activities.

Liquidation Regulations and Relevant Acts

The process of liquidation is governed by several regulations and acts, including:

Companies Act, 2013

The act outlines the circumstances under which a company can be shut down, including special resolutions, acts against the country's sovereignty, court findings, failure to file yearly returns, and more.

Insolvency and Bankruptcy Code, 2016

This code deals with the voluntary liquidation of companies through special resolutions passed by board members.

Benefits of LLP Annual Filing Compliances with Fincto

Director's Resignation:

If a director voluntarily tenders their resignation, the following steps are taken:

A board meeting is held after providing seven days of clear notice.
The board takes note of the resignation and passes a resolution in the specified format.
The resigning director files Form DIR-11 individually.
The company files Form DIR-12 with the Registrar of Companies (RoC), along with the registration letter and board resolution.
After completing all formalities, the director's name is removed from the Ministry of Corporate Affairs (MCA) website.

Absence from Board Meetings:

If a director is absent from all board meetings for 12 consecutive months without seeking leave, they are considered to have vacated their office as per Section 167. The process involves filing Form DIR-12, and the director's name is removed from the MCA database.

Removal by Shareholders:

The steps for removal of a director by shareholders are as follows:

A notice is sent to all shareholders for a board meeting within seven days.
A resolution is passed in the general meeting for the director's removal, subject to shareholder approval.
After providing a 21-day notice, a second shareholders' meeting is held to vote on the removal resolution.
The shareholders file Form DIR-12, along with board resolution attachments and an ordinary resolution.
Once all formalities are completed, the director's name is removed from the MCA database.
Consequences of Not Filing Form DIR-12:
Filing Form DIR-12 within 30 days from the date of resignation is crucial to avoid penalties. Failure to do so may result in increasing penalties, starting from twice the government fees and escalating further for each delay.

Top Reasons for Compulsory Winding Up of a Company

A private limited company must adhere to regular compliance requirements throughout its lifecycle. Some reasons for compulsory winding up of a company include:

Special Resolution

The company adopts a special resolution directing the tribunal to wind up the business.

Non-compliance

Failure to file required reports with the registrar's office.

Inactivity

Failure to commence business within a year of incorporation.

Employee Count

The number of employees falls below the required threshold for a public or private company.

Financial Distress

Inability to pay debts and liabilities.

Just and Equitable

The court's decision deems the dissolution of the company as just and equitable.

Closing a Company in India - Options and Procedures

Directors must submit KYC information to MCA if they meet recent updates.

Winding Up

The Ministry of Corporate Affairs offers the 'Strike Off' mechanism for inactive businesses, which can be initiated voluntarily through specific resolutions or court orders.

Fast Track Exit

This method, available under Section 248 of the Companies Act of 2013, is a quick and straightforward way to dissolve a defunct company.

Consequences of Winding up a Company - Important Considerations

Loss of Control

Once a liquidator is appointed, the company's owners lose control over the business and its assets.

Directors' Authority

Although still holding their titles, directors no longer have control over the company's decisions during liquidation.

Asset Liquidation

All assets are sold off to repay creditors as much of the company's debt as possible.

Personal Guarantees

Directors may still be personally liable for debts guaranteed by them, even after the company's bankruptcy.

Occupation Restrictions:

Depending on the industry, directors may be prohibited from working in the same field for a certain period after the company's bankruptcy.

Documents Required for Director Removal:

Businesses must fulfill various compliances, in addition to company compliances.These include:

Notice of Board Meeting
Special Notice to Director
Resignation Letter (if applicable)
Form DIR-12
Board Resolution
Declaration by Director stating no objection to removal.

Importance of Online Accounting Services & Company Compliance Services

Private limited companies must prioritize annual compliances, ensuring filings meet due dates and adhering to prescribed guidelines

Budgeting

Manage company income, expenditure, and monitor managerial policies effectively.

Evaluating Business Performance

Assess business performance using key metrics like net profit.

Managing Cash Flow

Monitor business finances for effective project planning and financial management.

Providing Financial Information to Investors and Stakeholders

Assess a business's financial health and credibility for investors.

Mandatory by Law

Registrar of Companies mandates income tax compliance, avoiding fines.

Navigating CSR-1 Registration

CSR-1 registration is crucial for NGOs seeking corporate social responsibility (CSR) funding from companies with specific net worth, turnover, or net profit. To initiate the process, NGOs must file Form CSR-1 with the Ministry of Corporate Affairs (MCA), which may require additional documentation or clarifications. Approval grants NGOs the CSR-1 registration certificate, paving the way for securing CSR funding from companies. This one-week process is essential for NGOs in the CSR funding realm.

Form DIR-3 KYC: Empowering Directors with fincto

The Director Identification Number (DIN) is a crucial identifier for aspiring and current directors in corporate governance. Obtaining a DIN requires a one-time application through eForm DIR-3. An annual requirement has been introduced, requiring directors with DINs to submit KYC details annually through fincto’s expertise.

Customizable Founders Agreement Template: A Framework for Success

THIS FOUNDERS’ AGREEMENT (hereinafter referred to as the ‘Agreement’) is executed on [DD/MM/YYYY] by and among [XXXX] (the ‘Company’), and the following founders (the ‘Founders’):

[Insert Founder Name]

NOW, WITH DUE CONSIDERATION to the foregoing and the mutual covenants and agreements hereinafter detailed, the parties hereto concur as follows:

[Continuation of the founders agreement template, incorporating company information, initial capital, ownership structure, vesting schedule, intellectual property rights, amendment protocols, resignation procedures, confidentiality commitments, dispute resolution, and more.]

Advantage for NDA Crafting

Tech-Infused Expertise

Fincto combines technology and legal expertise for thousands of legal tasks.

Seamless Government Interaction

Government processes simplified for convenience.

Dual Iteration Rounds

Package includes two iterations for satisfaction.

Effortless Legal Processes

Fincto simplifies legal processes, making them accessible and accessible.

For comprehensive guidance, expert consultation is recommended.

Key Elements of a Founders Agreement: Navigating Clauses

A founders agreement encompasses several pivotal sections, including:

Founder Identification

Identifying co-founders and their roles within the company.

Ownership Structure

Defining equity ownership distribution and percentage among co-founders.

Vesting Schedule

Potential inclusion of a vesting timetable for equity shares.

Intellectual Property Rights

Managing intellectual property rights in business ventures.

Decision-Making Protocols

Outlining decision-making mechanisms, roles, and responsibilities of co-founders.

Termination and Exit Clauses

Describing scenarios leading to termination and exit procedures for co-founders.

Dispute Resolution

Establishing protocols for dispute resolution, including mediation and arbitration.

Product Returns

Customer may receive a refund for product dislike, damaged, incorrect item, or predefined issues upon return.

Order Cancellations

Refund policy governs online order cancellation process, details, and procedures for refunds.

GST Tax Rates

Website Disclaimer: Shielding Your Online Presence

A Website Disclaimer communicates liabilities to visitors, safeguards intellectual property, discourages unauthorized usage, and prevents misuse accusations. It can be standalone or integrated into legal documents, demonstrating responsible online conduct and promoting responsible behavior.

Cookie Policy Landscape

A Cookie Policy is essential for online transparency and legal compliance, educating visitors about active cookies, their purpose, and user data processing. It is often a legal requirement in many jurisdictions.

Shipping and Delivery Policies: Streamlining E-Commerce

E-commerce relies on efficient shipping and delivery; a Shipping Policy provides clear information on fees, timelines, and procedures, improving customer experience.

Overview of GST Filing Returns - Types and Due Dates

GSTR1

GSTR1 is the form used for tax returns on outward supplies, encompassing both interstate and intrastate B2B and B2C sales. It also includes details of purchases under reverse charge and inter-state stock transfers made during the tax period. Late filing of GSTR1 can result in a late fee, which is collected in the subsequent open return, Form GSTR-3B. Since January 1, 2022, taxpayers cannot file Form GSTR-1 if they haven't filed Form GSTR-3B in the preceding month.

GSTR1A

This amendment form corrects any discrepancies between the GSTR-1 of a taxpayer and the GSTR-2 of their customers. The filing window for GSTR1A is between the 15th and 17th of the following month.

GSTR2

Monthly GST returns for inward supplies are filed using this form. It contains taxpayer information, return period, and detailed invoice-level purchase information related to goods and services separately.

GSTR2A

This auto-generated tax return compiles purchases and inward supplies made by a taxpayer based on the information from their suppliers GSTR-1.

GSTR2B

An auto-generated document that acts as an Input Tax Credit (ITC) statement for taxpayers, facilitating faster return filing, minimizing errors, easing reconciliation, and simplifying compliance.

GSTR3

This form is used to file consolidated monthly tax returns. It contains the taxpayers basic information, turnover details, final aggregate-level inward and outward supply details, tax liability under CGST, SGST, IGST, additional tax (+1% tax), ITC, cash, liability ledgers, and details of other payments like interests, penalties, and fees.

GSTR3A

This is a tax notice issued by the tax authority to a defaulter who has failed to file monthly GST returns on time.

GSTR3B

It is a temporary consolidated summary GST return for inward and outward supplies, introduced as a relaxation for recently registered businesses.

GSTR4

This quarterly GST return is filed by compounding vendors. It includes the total value of supplies made during the covered period and details of tax paid at the compounding rate (not exceeding 1% of aggregate turnover) along with invoice details for inward supplies.

GSTR4A

The Quarterly purchase-related tax return filed by composition dealers, automatically generated by the GSTN portal based on information from the suppliers GSTR-1, GSTR-5, and GSTR-7.

GSTR5

Variable return for Non-resident foreign taxpayers, containing details of the taxpayer, return period, and invoice details of all goods and services sold and purchased. It also includes imports on Indian soil for the registered period/month.

GSTR6

This monthly GST return is for ISDs (Input Service Distributors), containing details of invoice-level supply from the GSTR-1 of counterparties, credit for ITC services received, debit for ITC reversed or distributed, and closing balance.

GSTR7

It is a monthly return for TDS (Tax Deducted at Source) transactions, containing the taxpayers basic information, return period, supplier's GSTIN, and invoices against which the tax has been deducted, categorized under SGST, CGST, and IGST. It also includes details of other payments like interests and penalties.

GSTR8

This is the monthly return for e-commerce operators. It contains the taxpayers basic information, return period, details of supplies made to customers through the e-commerce portal, tax collected at source, tax payable, and tax paid.

GSTR9

The annual consolidated tax return, comprising detailed income and expenditure, regrouped according to the monthly GST returns filed by the taxpayer.

GSTR9A

The annual composition return form to be filed by every taxpayer enrolled in the composition scheme.

GSTR9C

This Audit form is filed by taxpayers liable to get their annual reports audited when their aggregate turnover exceeds ₹2 crores in a financial year.

GSTR10

Filed before cancelling GST registration, this final GST return contains the details of all supplies, liabilities, tax collected, and tax payable.

GSTR11

Variable tax return for taxpayers with UIN (Unique Identification Number), containing details of purchases made by foreign embassies and diplomatic missions for self-consumption during a particular month.

Using Bonds or LUT: A Deep Dive

Entrust your Form DIR-3 KYC submission to fincto for a stress-free, seamless process, allowing you to focus on core responsibilities as a director. Fincto embodies excellence in compliance, ensuring compliant and confident directorship.

Due Dates for GST Returns

Staying compliant with GST due dates is vital to avoid late payment charges and interests. Fincto provides updated information on due dates for the financial years 2021-2022 and 2022-2023. Keeping clients informed of these updates can help taxpayers stay on top of their compliance requirements and ensure timely filing of GST returns.

GST Return Filing under the Composition Scheme

Taxpayers registered under the Composition Scheme must file taxes using CMP-08 every quarter and file GSTR-4 annually. The due date for the GST return for Composition Scheme registrants is the 18th of the month following each quarter.

Choose Fincto for a Seamless GST Return Filing Experience

Fincto provides a hassle-free GST return filing experience with the support of a team of dedicated experts. Fincto offers a seamless GST compliance journey. It's commendable to see such dedication to assisting taxpayers in their GST return filing processes.

What is a GST Certificate?

A GST Certificate is an important document issued by the Indian government which proves that a business is registered under GST. The certificate contains crucial information like the GST identification number, name, and address of the business. With a GST Certificate on hand, businesses can easily charge and collect GST, apply for loans, and participate in tenders.

With Fincto.io's expert guidance, you can navigate the GST registration process with confidence and focus on your business's growth and success.

Why Fincto?

Fincto offers a simple, speedy process for changing company objectives, including expert guidance, assistance in adding main and ancillary objectives, draft and fill resolutions, timely amendments to MoA, and excellent support for queries.

Trust Fincto to simplify your business formation process, enabling a seamless transition from idea to a legally recognized entity. Get ready for a well-informed, growth-oriented entrepreneurial journey with Fincto.

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