Compliance Applicability Checklist Under the Companies Act, 2013

Compliance Applicability Checklist Under the Companies Act, 2013 . The Companies Act, 2013 lays down various statutory obligations for meeting compliance for companies doing business in India as per various sections and rules to stay up-to-date and follow the corporate governance mechanism. It is important to note here that type of compliance also depends on the type of companies. The applicability of various MCA statutory compliance requirements depend on the threshold such as Turnover, Networth, Paid-up Capital, Deposits, Borrowings, and Shareholding Structure including but not limited to various corporate actions that take place in the course of the business of a company. 
To understand the threshold or applicability limits better for compliance and its applicability is important for business founders to meet regulatory requirements and avoid fines, penalties and imprisonment as the case may be. In this article, we will explore the key threshold limits and applicability criteria for various provisions under the Companies Act, 2013 for any private limited company in India. 
Threshold limits and applicability criteria for various provisions under the Companies Act, 2013
The following are the key threshold limits and applicability criteria for various provisions under the Companies Act, 2013 for any private limited company in India. 
1. Small Company – Section 2(85) Compliance & Benefits

Legal Provisions

Section 2(85) of the Companies Act, 2013

Applicability

Private Companies

Threshold Limits (Budget 2024-25 Update)

Paid-up Capital (PUC): Up to Rs.4 Crores
Turnover (TO): Up to Rs.40 Crores

Major Exemptions

Reduced compliance for MCA Annual Filings & Board Meetings
No mandatory Cash Flow Statement
Relaxed Audit Requirements
Lower ROC Filing Fees and other form fees
No Mandatory ISIN Applicability or Dematerlisation of Shares under Rule 9B for Private Companies which is small Company

Benefits

Simplified compliance for MSMEs & startups
Reduced financial & operational burden
Faster decision-making due to fewer regulatory restrictions

Impact of Exceeding Threshold

If a company surpasses the threshold, it must comply with standard corporate regulations, including full financial disclosures, statutory audit requirements, and higher compliance costs.

2. Acceptance of Deposits – Section 76 & CG Rules

Aspect

Details

Legal Provisions

Section 76 of the Companies Act, 2013 & Companies (Acceptance of Deposits) Rules, 2014

Applicability

Public Companies

Threshold Limits

Net Worth (NW): Rs.100 Crores or more
Turnover (TO): Rs.500 Crores or more
Approval: Special Resolution in General Meeting (GM) & Filing of MGT-14

Compliance Requirements

Form DPT-1: File before inviting deposits
Deposit Repayment Reserve Account: Maintain at least 20% of maturing deposits for the next financial year
Obtain Credit Rating from a recognized agency
Issue Deposit Receipts within 21 days of acceptance
Repayment on Maturity as per agreed terms
Filing of Return of Deposit with MCA

Penalties for Non-Compliance

Fine up to Rs.1 Crore
 Possible Disqualification of Directors
Additional penalty of Rs.5,000 per day for continuing default

Benefits of Accepting Public Deposits

Alternative funding source instead of loans
Business expansion without equity dilution
Flexible interest rates compared to bank borrowings

Impact of Exceeding Threshold

If a company surpasses the threshold, it can legally accept public deposits but must comply with strict regulatory provisions under the Companies Act, 2013 and deposit rules. 
DPT-3 Filing for non deposit Item under 2(1)(c) and its due date.

3. Annual Return – Section 92(2) & Rule 11

Aspect

Details

Legal Provisions

Section 92(2) of the Companies Act, 2013 & Rule 11 of Companies (Management and Administration) Rules, 2014

Applicability

Listed Companies
Public Companies
Private Companies exceeding a certain threshold

Threshold Limits

Small Companies & OPCs: Must file Form MGT-7A
Other Companies: Must file Form MGT-7 with PCS Certification 
Companies requiring PCS Report in Form MGT-8 when company

PUC: Rs.10 Crores or more
Turnover (TO): Rs.50 Crores or more

Compliance Requirements

Annual Return Filing: Companies must file MGT-7 or MGT-7A within 60 days of the Annual General Meeting (AGM).
Form MGT-8 (PCS Certification), Required for companies exceeding the specified PUC and TO (Turnover) thresholds.
 Details to be disclosed in Annual Return:

Shareholding pattern
Company’s financial status
Board structure & directorship details
Any changes in the company’s share capital, securities, and governance

Penalties for Non-Compliance

Late filing penalty: Rs.100 per day of delay 
And, Failure to file Annual Return: Fine up to Rs.5 Lakh for the company and Rs.50,000 for directors/officers in default 
Click here to read MCA Order for Non compliance.

Benefits of Compliance

To Check transparency in company operations
Mandatory for due diligence by investors and regulatory bodies
Prevents penalties and legal consequences

Impact of Exceeding Threshold

Companies exceeding the prescribed PUC and TO limits must obtain PCS certification (Form MGT-8) for stricter compliance norms to check company compliances and records status.

4. Corporate Social Responsibility (CSR) – Section 135

Aspect

Details

Legal Provisions

Section 135 of the Companies Act, 2013 & Companies (Corporate Social Responsibility Policy) Rules, 2014

Applicability

Every Company that meets the CSR financial threshold

Threshold Limits

Turnover (TO): Rs.1000 Crores or more
Net Worth (NW): Rs.500 Crores or more
Net Profit (NP): Rs.5 Crores or more

Compliance Requirements

Companies exceeding the CSR threshold must spend at least 2% of their average net profits from the past three financial years on CSR activities.
Must constitute a CSR Committee consisting of at least three directors, with one being an Independent Director (for public companies).
CSR Policy: Companies must develop a policy outlining CSR objectives, implementation plans, and budgets.
CSR-2 Form Filing: Mandatory submission of CSR-2 Form as an addendum to AOC-4 to report CSR expenditures and activities.

Permitted CSR Activities

Eradicating hunger, poverty, and malnutrition
Promoting education, healthcare, and gender equality
Environmental sustainability and rural development
Supporting arts, culture, sports, and disaster relief

Penalties for Non-Compliance

Unspent CSR funds must be transferred to a government fund or an eligible NGO
Failure to comply may lead to penalties under the Companies Act, including fines for the company and officers in default

Benefits of CSR Compliance

Improves brand image and corporate goodwill
Enhances stakeholder trust and investor confidence
Helps companies contribute meaningfully to society while gaining tax benefits

Impact of Exceeding Threshold

Once a company crosses the CSR threshold, it must allocate funds for CSR and report detailed spending and impact metrics annually.

5. XBRL Filing Requirement – Section 137 & Rule 3

Aspect

Details

Legal Provisions

Section 137 of the Companies Act, 2013 & Companies (Filing of Documents and Forms in Extensible Business Reporting Language) Rules, 2015

Applicability

XBRL Filing Applicability

Listed Companies & their Indian Subsidiaries
Other Companies meeting financial thresholds

Threshold Limits

Paid-up Capital (PUC): Rs.5 Crores or more
Turnover (TO): Rs.100 Crores or more
Financial Statements: Prepared as per Ind AS Rules

Compliance Requirements

Mandatory Filing in XBRL AOC-4 format for financial statements and other required documents.

Companies must submit their Balance Sheet, Profit & Loss Account, Cash Flow Statements, and Audit Reports in XBRL format.

Filing is done through the MCA XBRL portal, following the prescribed taxonomy and validation rules.

Exemptions from XBRL Filing

Private Companies (unless meeting the threshold)
Companies in Banking, Insurance, and NBFC sectors
Companies using accounting standards other than Ind AS

Penalties for Non-Compliance

Failure to file XBRL reports on time may result in monetary penalties and additional MCA scrutiny 
Companies and responsible officers may be fined up to ?1 Lakh or more based on the period of default

Benefits of XBRL Filing

Enhanced Financial Transparency and comparability
Automated Data Processing improves accuracy
Facilitates Analysis for Regulatory Authorities & Investors

Impact of Exceeding Threshold

Companies meeting the PUC & TO thresholds must transition to XBRL reporting for enhanced digital compliance and financial disclosures.

6. Internal Auditor – Section 138 & Rule 13

Aspect

Details

Legal Provisions

Section 138 of the Companies Act, 2013 & Rule 13 of Companies (Accounts) Rules, 2014

Applicability

Listed Companies
Unlisted Public Companies
Private Companies (Above the Threshold Limit)

Threshold Limits

Unlisted Public Companies:

Paid-up Capital (PUC): Rs.50 Crores or more
Turnover (TO): Rs.200 Crores or more
Outstanding Loans/Borrowings: More than Rs.100 Crores
Outstanding Deposits: More than Rs.25 Crores

Private Companies:

Turnover (TO): Rs.200 Crores or more
Outstanding Loans/Borrowings: More than Rs.100 Crores

Compliance Requirements

Mandatory Appointment of an Internal Auditor for companies meeting the threshold.

Internal Auditor can be a Chartered Accountant (CA), Cost Accountant (CMA), or any other professional as per the company’s requirement.

Internal Audit Reports should be reviewed by the Board of Directors & Audit Committee (where applicable).

The role of an Internal Auditor includes:

Monitoring internal financial controls
Assessing risk management and compliance frameworks
Evaluating operational efficiency

Penalties for Non-Compliance

Failure to appoint an Internal Auditor can lead to regulatory scrutiny, financial penalties, and compliance defaults under the Companies Act, 2013.

Benefits of Internal Audit Compliance

Improved risk management and operational efficiency
Better financial and regulatory compliance
Increases investor and stakeholder confidence

Impact of Exceeding Threshold

Companies exceeding the prescribed limits must appoint an Internal Auditor and maintain regular internal audit reports for compliance.

7. Appointment of Women Director – Section 149 & Rule 3

Aspect

Details

Legal Provisions

Section 149 of the Companies Act, 2013 & Rule 3 of Companies (Appointment and Qualification of Directors) Rules, 2014

Applicability

Listed Companies
Public Companies meeting the prescribed threshold

Threshold Limits

Paid-up Capital (PUC): Rs.100 Crores or more
Turnover (TO): Rs.300 Crores or more

Compliance Requirements

Mandatory Appointment of at least one Woman Director on the Board of Directors.

The appointment must be done within 6 months of meeting the threshold criteria.

If a company ceases to meet the threshold, the requirement to retain a Woman Director remains unless approved by the regulatory authority by filing DIR-12

Penalties for Non-Compliance

Failure to appoint a Woman Director can lead to financial penalties and regulatory scrutiny under the Companies Act.

Benefits of Compliance

Improves corporate governance and board diversity
Enhances decision-making with diverse leadership
Aligns with global standards on gender inclusivity in corporate boards

Impact of Exceeding Threshold

Companies crossing the PUC or Turnover limits must immediately appoint a Woman Director and ensure board compliance under Section 149.

8. Independent Director – Section 149 & Rule 4

Aspect

Details

Legal Reference

Section 149 of the Companies Act, 2013 & Rule 4 of Companies (Appointment and Qualification of Directors) Rules, 2014

Applicability

Listed Companies
Public Companies meeting the prescribed threshold

Threshold Limits

Paid-up Capital (PUC): Rs.10 Crores or more
Turnover (TO): Rs.100 Crores or more
Outstanding Loans/Deposits: More than Rs.50 Crores

Learn How to Change Paid up Capital of the Company ?

Compliance Requirements

Mandatory Appointment of Independent Directors for companies crossing the threshold and Filing of DIR-12 form with MCA

Listed Companies must have at least one-third of their Board as Independent Directors.

Public Companies meeting the threshold must appoint at least two Independent Directors.

Independent Directors must be professionals with relevant expertise, who must be unbiased decision-making power.

Penalties for Non-Compliance

Failure to appoint an Independent Director can lead to penalties under the Companies Act, regulatory scrutiny, and corporate governance risks.

Benefits of Compliance

To increase corporate governance and transparency
Brings an unbiased perspective to Board decisions
Builds investor confidence and credibility

Impact of Exceeding Threshold

Companies crossing the PUC, TO, or Loan/Deposit limits must appoint Independent Directors to comply with corporate governance regulations.

9. Vigil Mechanism – Section 177(9) & Rule 7

Aspect

Details

Legal Provisions

Section 177(9) of the Companies Act, 2013 & Rule 7 of Companies (Meetings of Board and its Powers) Rules, 2014

Applicability

Listed Companies
Public Companies
Private Companies meeting the prescribed conditions

Threshold Limits

Borrowings: More than Rs.50 Crores
Companies accepting Public Deposits

Compliance Requirements

Mandatory Establishment of a Vigil Mechanism to enable whistleblowing by employees, directors, and stakeholders.

Companies must ensure protection for whistleblowers against victimization.

Listed Companies must have an Audit Committee to oversee the Vigil Mechanism.

The Vigil Mechanism policy should be publicly disclosed on the company's website and included in the Board’s Report.

Penalties for Non-Compliance

Failure to establish a Vigil Mechanism may lead to regulatory scrutiny and penalties under corporate governance rules.

Benefits of Compliance

To increase the corporate transparency and accountability
Encourages ethical business practices
Protects employees and stakeholders from fraud and misconduct

Impact of Exceeding Threshold

Companies crossing the Borrowing or Public Deposit limits must implement a structured Vigil Mechanism to comply with corporate governance requirements.

10. Secretarial Audit – Section 204 & Rule 9

Aspect

Details

Legal Provisions

Section 204 of the Companies Act, 2013 & Rule 9 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

Applicability

Listed Companies
Public Companies meeting prescribed thresholds
Private Companies meeting borrowing thresholds

Threshold Limits

Public Companies:

Paid-up Capital (PUC): Rs.50 Crores or more
Turnover (TO): Rs.250 Crores or more

Every Company:

Outstanding Loans/Borrowings: Rs.100 Crores or more

Compliance Requirements

Mandatory Appointment of a Company Secretary (PCS) to conduct a Secretarial Audit.

Companies must file a Secretarial Audit Report (Form MR-3) as part of their Board Report.

The audit covers compliance with company law, SEBI regulations, FEMA, and other corporate governance laws.
The Company Secretary must be an independent practicing professional with no conflicts of interest.

Penalties for Non-Compliance

Failure to conduct a Secretarial Audit may lead to penalties under Section 204(4) of the Companies Act, including fines for the company and responsible officers.

Benefits of Compliance

Ensures corporate governance compliance and transparency
Identifies potential risks in company operations
Prevents regulatory issues and legal liabilities

Impact of Exceeding Threshold

Companies exceeding the PUC, TO, or Borrowing limits must appoint a PCS to conduct an independent Secretarial Audit annually.

11. Appointment of Company Secretary (CS) as Key Managerial Personnel (KMP)-Section 203

Aspect

Details

Legal Provisions

Section 203 of the Companies Act, 2013 & Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

Applicability

Listed Companies
Public Companies meeting the prescribed threshold
Private Companies meeting the paid-up capital threshold

Threshold Limits

Public Companies:

Paid-up Capital (PUC): Rs.10 Crores or more (Mandatory CS)
Private Companies:
Paid-up Capital (PUC): Rs.10 Crores or more (Mandatory CS)

Listed Companies:

Must appoint CEO, CFO, MD, and CS as per KMP provisions

Compliance Requirements

Mandatory Appointment of a Company Secretary (CS) for Companies exceeding ?10 Cr PUC 
Listed Companies must appoint a full-time KMP, including a CEO/MD, CFO, and CS
- KMP appointments must be reported to the ROC via Form DIR-12
- KMPs must ensure compliance with governance, board regulations, and statutory filings with MCA

Penalties for Non-Compliance

Failure to appoint a KMP can lead to penalties under Section 203, including fines for the company and defaulting officers, as one order may read here for MCA Adjudication for non compliance of section 203 of the companies Act 2013.

Benefits of Compliance

Improve the corporate governance and operational transparency
To check the statutory and regulatory compliance
Improves investor confidence and decision-making efficiency

Impact of Exceeding Threshold

Companies exceeding the PUC or listing requirements must appoint KMPs, ensuring compliance with governance and reporting obligations.

Hence, by checking all above the threshold limits applicability prescribed under the Companies Act, 2013 play a very important role in determining the applicability of mandatory statutory compliance obligations for different categories of companies in India. Whether you operate a private limited company, a public company, or a listed entity, understanding these thresholds is important to avoid any MCA RD Adjudication notices for any non compliances and the company should approach a right professional in the company law advisory services. 
As businesses grow and expand, they may surpass certain financial limits, triggering new compliance requirements like Appointment of Company Secretary, Filing of XBRL, MGT-8 Certification by PCS etc. Therefore, companies must periodically review their financial statements and assess whether they have crossed any statutory thresholds that necessitate additional filings with MCA or changes in MOA & AOA of the Company or required any mandatory Filings. Hence, During year-end financial reporting and book closure, companies should thoroughly examine their net worth, turnover, outstanding borrowings, and public deposits to determine whether any new regulatory obligations have become applicable. 
To uphold corporate governance and financial transparency, businesses must adopt a proactive compliance approach through company due diligence service and we are glad to share that we have been serving professional services since 2016 and helping with MCA filings, secretarial compliances, financial disclosures and various other corporate actions as may be required time to time. To learn more how we can help you, reach out to info@ccoffice.in.

The Companies Act, 2013 lays down various statutory obligations for meeting compliance for companies doing business in India as per various sections and rules to stay up-to-date and follow the corporate governance mechanism. It is important to note here that type of compliance also depends on the type of companies. The applicability of various MCA statutory compliance requirements depend on the threshold such as Turnover, Networth, Paid-up Capital, Deposits, Borrowings, and Shareholding Structure including but not limited to various corporate actions that take place in the course of the business of a company.

To understand the threshold or applicability limits better for compliance and its applicability is important for business founders to meet regulatory requirements and avoid fines, penalties and imprisonment as the case may be. In this article, we will explore the key threshold limits and applicability criteria for various provisions under the Companies Act, 2013 for any private limited company in India.

Threshold limits and applicability criteria for various provisions under the Companies Act, 2013

The following are the key threshold limits and applicability criteria for various provisions under the Companies Act, 2013 for any private limited company in India.

1. Small Company – Section 2(85) Compliance & Benefits

Legal Provisions	Section 2(85) of the Companies Act, 2013
Applicability	Private Companies
Threshold Limits (Budget 2024-25 Update)	Paid-up Capital (PUC): Up to Rs.4 Crores Turnover (TO): Up to Rs.40 Crores
Major Exemptions	Reduced compliance for MCA Annual Filings & Board Meetings No mandatory Cash Flow Statement Relaxed Audit Requirements Lower ROC Filing Fees and other form fees No Mandatory ISIN Applicability or Dematerlisation of Shares under Rule 9B for Private Companies which is small Company
Benefits	Simplified compliance for MSMEs & startups Reduced financial & operational burden Faster decision-making due to fewer regulatory restrictions
Impact of Exceeding Threshold	If a company surpasses the threshold, it must comply with standard corporate regulations, including full financial disclosures, statutory audit requirements, and higher compliance costs.

2. Acceptance of Deposits – Section 76 & CG Rules

Aspect	Details
Legal Provisions	Section 76 of the Companies Act, 2013 & Companies (Acceptance of Deposits) Rules, 2014
Applicability	Public Companies
Threshold Limits	Net Worth (NW): Rs.100 Crores or more Turnover (TO): Rs.500 Crores or more Approval: Special Resolution in General Meeting (GM) & Filing of MGT-14
Compliance Requirements	Form DPT-1: File before inviting deposits Deposit Repayment Reserve Account: Maintain at least 20% of maturing deposits for the next financial year Obtain Credit Rating from a recognized agency Issue Deposit Receipts within 21 days of acceptance Repayment on Maturity as per agreed terms Filing of Return of Deposit with MCA
Penalties for Non-Compliance	Fine up to Rs.1 Crore Possible Disqualification of Directors Additional penalty of Rs.5,000 per day for continuing default
Benefits of Accepting Public Deposits	Alternative funding source instead of loans Business expansion without equity dilution Flexible interest rates compared to bank borrowings
Impact of Exceeding Threshold	If a company surpasses the threshold, it can legally accept public deposits but must comply with strict regulatory provisions under the Companies Act, 2013 and deposit rules. DPT-3 Filing for non deposit Item under 2(1)(c) and its due date.

3. Annual Return – Section 92(2) & Rule 11

Aspect	Details
Legal Provisions	Section 92(2) of the Companies Act, 2013 & Rule 11 of Companies (Management and Administration) Rules, 2014
Applicability	Listed Companies Public Companies Private Companies exceeding a certain threshold
Threshold Limits	Small Companies & OPCs: Must file Form MGT-7A Other Companies: Must file Form MGT-7 with PCS Certification Companies requiring PCS Report in Form MGT-8 when company PUC: Rs.10 Crores or more Turnover (TO): Rs.50 Crores or more
Compliance Requirements	Annual Return Filing: Companies must file MGT-7 or MGT-7A within 60 days of the Annual General Meeting (AGM). Form MGT-8 (PCS Certification), Required for companies exceeding the specified PUC and TO (Turnover) thresholds. Details to be disclosed in Annual Return: Shareholding pattern Company’s financial status Board structure & directorship details Any changes in the company’s share capital, securities, and governance
Penalties for Non-Compliance	Late filing penalty: Rs.100 per day of delay And, Failure to file Annual Return: Fine up to Rs.5 Lakh for the company and Rs.50,000 for directors/officers in default Click here to read MCA Order for Non compliance.
Benefits of Compliance	To Check transparency in company operations Mandatory for due diligence by investors and regulatory bodies Prevents penalties and legal consequences
Impact of Exceeding Threshold	Companies exceeding the prescribed PUC and TO limits must obtain PCS certification (Form MGT-8) for stricter compliance norms to check company compliances and records status.

4. Corporate Social Responsibility (CSR) – Section 135

Aspect	Details
Legal Provisions	Section 135 of the Companies Act, 2013 & Companies (Corporate Social Responsibility Policy) Rules, 2014
Applicability	Every Company that meets the CSR financial threshold
Threshold Limits	Turnover (TO): Rs.1000 Crores or more Net Worth (NW): Rs.500 Crores or more Net Profit (NP): Rs.5 Crores or more
Compliance Requirements	Companies exceeding the CSR threshold must spend at least 2% of their average net profits from the past three financial years on CSR activities. Must constitute a CSR Committee consisting of at least three directors, with one being an Independent Director (for public companies). CSR Policy: Companies must develop a policy outlining CSR objectives, implementation plans, and budgets. CSR-2 Form Filing: Mandatory submission of CSR-2 Form as an addendum to AOC-4 to report CSR expenditures and activities.
Permitted CSR Activities	Eradicating hunger, poverty, and malnutrition Promoting education, healthcare, and gender equality Environmental sustainability and rural development Supporting arts, culture, sports, and disaster relief
Penalties for Non-Compliance	Unspent CSR funds must be transferred to a government fund or an eligible NGO Failure to comply may lead to penalties under the Companies Act, including fines for the company and officers in default
Benefits of CSR Compliance	Improves brand image and corporate goodwill Enhances stakeholder trust and investor confidence Helps companies contribute meaningfully to society while gaining tax benefits
Impact of Exceeding Threshold	Once a company crosses the CSR threshold, it must allocate funds for CSR and report detailed spending and impact metrics annually.

5. XBRL Filing Requirement – Section 137 & Rule 3

Aspect	Details
Legal Provisions	Section 137 of the Companies Act, 2013 & Companies (Filing of Documents and Forms in Extensible Business Reporting Language) Rules, 2015
Applicability	XBRL Filing Applicability Listed Companies & their Indian Subsidiaries Other Companies meeting financial thresholds
Threshold Limits	Paid-up Capital (PUC): Rs.5 Crores or more Turnover (TO): Rs.100 Crores or more Financial Statements: Prepared as per Ind AS Rules
Compliance Requirements	Mandatory Filing in XBRL AOC-4 format for financial statements and other required documents. Companies must submit their Balance Sheet, Profit & Loss Account, Cash Flow Statements, and Audit Reports in XBRL format. Filing is done through the MCA XBRL portal, following the prescribed taxonomy and validation rules.
Exemptions from XBRL Filing	Private Companies (unless meeting the threshold) Companies in Banking, Insurance, and NBFC sectors Companies using accounting standards other than Ind AS
Penalties for Non-Compliance	Failure to file XBRL reports on time may result in monetary penalties and additional MCA scrutiny Companies and responsible officers may be fined up to ?1 Lakh or more based on the period of default
Benefits of XBRL Filing	Enhanced Financial Transparency and comparability Automated Data Processing improves accuracy Facilitates Analysis for Regulatory Authorities & Investors
Impact of Exceeding Threshold	Companies meeting the PUC & TO thresholds must transition to XBRL reporting for enhanced digital compliance and financial disclosures.

6. Internal Auditor – Section 138 & Rule 13

Aspect	Details
Legal Provisions	Section 138 of the Companies Act, 2013 & Rule 13 of Companies (Accounts) Rules, 2014
Applicability	Listed Companies Unlisted Public Companies Private Companies (Above the Threshold Limit)
Threshold Limits	Unlisted Public Companies: Paid-up Capital (PUC): Rs.50 Crores or more Turnover (TO): Rs.200 Crores or more Outstanding Loans/Borrowings: More than Rs.100 Crores Outstanding Deposits: More than Rs.25 Crores Private Companies: Turnover (TO): Rs.200 Crores or more Outstanding Loans/Borrowings: More than Rs.100 Crores
Compliance Requirements	Mandatory Appointment of an Internal Auditor for companies meeting the threshold. Internal Auditor can be a Chartered Accountant (CA), Cost Accountant (CMA), or any other professional as per the company’s requirement. Internal Audit Reports should be reviewed by the Board of Directors & Audit Committee (where applicable). The role of an Internal Auditor includes: Monitoring internal financial controls Assessing risk management and compliance frameworks Evaluating operational efficiency
Penalties for Non-Compliance	Failure to appoint an Internal Auditor can lead to regulatory scrutiny, financial penalties, and compliance defaults under the Companies Act, 2013.
Benefits of Internal Audit Compliance	Improved risk management and operational efficiency Better financial and regulatory compliance Increases investor and stakeholder confidence
Impact of Exceeding Threshold	Companies exceeding the prescribed limits must appoint an Internal Auditor and maintain regular internal audit reports for compliance.

7. Appointment of Women Director – Section 149 & Rule 3

Aspect	Details
Legal Provisions	Section 149 of the Companies Act, 2013 & Rule 3 of Companies (Appointment and Qualification of Directors) Rules, 2014
Applicability	Listed Companies Public Companies meeting the prescribed threshold
Threshold Limits	Paid-up Capital (PUC): Rs.100 Crores or more Turnover (TO): Rs.300 Crores or more
Compliance Requirements	Mandatory Appointment of at least one Woman Director on the Board of Directors. The appointment must be done within 6 months of meeting the threshold criteria. If a company ceases to meet the threshold, the requirement to retain a Woman Director remains unless approved by the regulatory authority by filing DIR-12
Penalties for Non-Compliance	Failure to appoint a Woman Director can lead to financial penalties and regulatory scrutiny under the Companies Act.
Benefits of Compliance	Improves corporate governance and board diversity Enhances decision-making with diverse leadership Aligns with global standards on gender inclusivity in corporate boards
Impact of Exceeding Threshold	Companies crossing the PUC or Turnover limits must immediately appoint a Woman Director and ensure board compliance under Section 149.

8. Independent Director – Section 149 & Rule 4

Aspect	Details
Legal Reference	Section 149 of the Companies Act, 2013 & Rule 4 of Companies (Appointment and Qualification of Directors) Rules, 2014
Applicability	Listed Companies Public Companies meeting the prescribed threshold
Threshold Limits	Paid-up Capital (PUC): Rs.10 Crores or more Turnover (TO): Rs.100 Crores or more Outstanding Loans/Deposits: More than Rs.50 Crores Learn How to Change Paid up Capital of the Company ?
Compliance Requirements	Mandatory Appointment of Independent Directors for companies crossing the threshold and Filing of DIR-12 form with MCA Listed Companies must have at least one-third of their Board as Independent Directors. Public Companies meeting the threshold must appoint at least two Independent Directors. Independent Directors must be professionals with relevant expertise, who must be unbiased decision-making power.
Penalties for Non-Compliance	Failure to appoint an Independent Director can lead to penalties under the Companies Act, regulatory scrutiny, and corporate governance risks.
Benefits of Compliance	To increase corporate governance and transparency Brings an unbiased perspective to Board decisions Builds investor confidence and credibility
Impact of Exceeding Threshold	Companies crossing the PUC, TO, or Loan/Deposit limits must appoint Independent Directors to comply with corporate governance regulations.

9. Vigil Mechanism – Section 177(9) & Rule 7

Aspect	Details
Legal Provisions	Section 177(9) of the Companies Act, 2013 & Rule 7 of Companies (Meetings of Board and its Powers) Rules, 2014
Applicability	Listed Companies Public Companies Private Companies meeting the prescribed conditions
Threshold Limits	Borrowings: More than Rs.50 Crores Companies accepting Public Deposits
Compliance Requirements	Mandatory Establishment of a Vigil Mechanism to enable whistleblowing by employees, directors, and stakeholders. Companies must ensure protection for whistleblowers against victimization. Listed Companies must have an Audit Committee to oversee the Vigil Mechanism. The Vigil Mechanism policy should be publicly disclosed on the company's website and included in the Board’s Report.
Penalties for Non-Compliance	Failure to establish a Vigil Mechanism may lead to regulatory scrutiny and penalties under corporate governance rules.
Benefits of Compliance	To increase the corporate transparency and accountability Encourages ethical business practices Protects employees and stakeholders from fraud and misconduct
Impact of Exceeding Threshold	Companies crossing the Borrowing or Public Deposit limits must implement a structured Vigil Mechanism to comply with corporate governance requirements.

10. Secretarial Audit – Section 204 & Rule 9

Aspect	Details
Legal Provisions	Section 204 of the Companies Act, 2013 & Rule 9 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
Applicability	Listed Companies Public Companies meeting prescribed thresholds Private Companies meeting borrowing thresholds
Threshold Limits	Public Companies: Paid-up Capital (PUC): Rs.50 Crores or more Turnover (TO): Rs.250 Crores or more Every Company: Outstanding Loans/Borrowings: Rs.100 Crores or more
Compliance Requirements	Mandatory Appointment of a Company Secretary (PCS) to conduct a Secretarial Audit. Companies must file a Secretarial Audit Report (Form MR-3) as part of their Board Report. The audit covers compliance with company law, SEBI regulations, FEMA, and other corporate governance laws. The Company Secretary must be an independent practicing professional with no conflicts of interest.
Penalties for Non-Compliance	Failure to conduct a Secretarial Audit may lead to penalties under Section 204(4) of the Companies Act, including fines for the company and responsible officers.
Benefits of Compliance	Ensures corporate governance compliance and transparency Identifies potential risks in company operations Prevents regulatory issues and legal liabilities
Impact of Exceeding Threshold	Companies exceeding the PUC, TO, or Borrowing limits must appoint a PCS to conduct an independent Secretarial Audit annually.

11. Appointment of Company Secretary (CS) as Key Managerial Personnel (KMP)-Section 203

Aspect	Details
Legal Provisions	Section 203 of the Companies Act, 2013 & Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
Applicability	Listed Companies Public Companies meeting the prescribed threshold Private Companies meeting the paid-up capital threshold
Threshold Limits	Public Companies: Paid-up Capital (PUC): Rs.10 Crores or more (Mandatory CS) Private Companies: Paid-up Capital (PUC): Rs.10 Crores or more (Mandatory CS) Listed Companies: Must appoint CEO, CFO, MD, and CS as per KMP provisions
Compliance Requirements	Mandatory Appointment of a Company Secretary (CS) for Companies exceeding ?10 Cr PUC Listed Companies must appoint a full-time KMP, including a CEO/MD, CFO, and CS - KMP appointments must be reported to the ROC via Form DIR-12 - KMPs must ensure compliance with governance, board regulations, and statutory filings with MCA
Penalties for Non-Compliance	Failure to appoint a KMP can lead to penalties under Section 203, including fines for the company and defaulting officers, as one order may read here for MCA Adjudication for non compliance of section 203 of the companies Act 2013.
Benefits of Compliance	Improve the corporate governance and operational transparency To check the statutory and regulatory compliance Improves investor confidence and decision-making efficiency
Impact of Exceeding Threshold	Companies exceeding the PUC or listing requirements must appoint KMPs, ensuring compliance with governance and reporting obligations.

As businesses grow and expand, they may surpass certain financial limits, triggering new compliance requirements like Appointment of Company Secretary, Filing of XBRL, MGT-8 Certification by PCS etc. Therefore, companies must periodically review their financial statements and assess whether they have crossed any statutory thresholds that necessitate additional filings with MCA or changes in MOA & AOA of the Company or required any mandatory Filings. Hence, During year-end financial reporting and book closure, companies should thoroughly examine their net worth, turnover, outstanding borrowings, and public deposits to determine whether any new regulatory obligations have become applicable.

To uphold corporate governance and financial transparency, businesses must adopt a proactive compliance approach through company due diligence service and we are glad to share that we have been serving professional services since 2016 and helping with MCA filings, secretarial compliances, financial disclosures and various other corporate actions as may be required time to time. To learn more how we can help you, reach out to info@ccoffice.in.