Governance & Compliance-India FAQs
- What are the mandatory annual compliance requirements for an Indian company?
Every Indian company must file Form AOC-4 (financial statements) and Form MGT-7 (annual return) with the Registrar of Companies, hold a minimum of four board meetings, complete a statutory audit, and file Director KYC annually. Foreign-invested companies must also file the annual FLA return with the RBI by 15 July. Failure attracts penalties and, for repeat defaults, director disqualification.
- What happens if a company misses its annual return or financial statement filings?
Failure to file annual returns or financial statements for three consecutive years disqualifies all directors under Section 164 of the Companies Act 2013 — preventing them from holding any Indian directorship for five years. The company may also be struck off the register. Late filings attract escalating fees. ATB Legal manages filing calendars with advance deadline notices to prevent this.
- What FEMA filings are required for a foreign-invested Indian company?
A foreign-invested company must file FC-GPR within 60 days of share allotment, FC-TRS within 60 days of any resident-to-non-resident transfer, and the annual FLA return with the RBI by 15 July through the FLAIR portal. Bonus shares to foreign shareholders require an FCGPR-B filing. Missed filings are regularised through compounding applications. ATB Legal manages the complete FEMA compliance calendar.
- What are the governance obligations for independent directors?
Listed companies and certain prescribed unlisted public companies must appoint independent directors under Section 149 of the Companies Act 2013. Independent directors must satisfy the independence criteria, attend at least one separate meeting of independent directors per year, provide an annual independence declaration, and comply with Schedule IV of the Act.
- Does SEBI compliance apply to private limited companies?
No. SEBI’s LODR Regulations 2015 apply only to listed companies. Private limited companies are subject to the Companies Act 2013 governance framework, FEMA compliance if foreign-invested, and any sector-specific regulatory requirements applicable to their industry — but not SEBI LODR.
- What is a compliance audit, and when should a company commission one?
A compliance audit is a structured review of a company’s adherence to its statutory obligations under the Companies Act 2013, FEMA, and applicable sectoral regulations — identifying gaps, pending filings, and areas of regulatory risk. It is particularly valuable for newly acquired companies, entities that have been dormant or lightly managed, businesses preparing for investment or M&A, and companies where prior compliance management has been inconsistent. ATB Legal conducts compliance audits and produces prioritised remediation plans.