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MAINTAINANCE OF STATUTORY BOOKS AND REGISTERS

CHAPTER – I

INTRODUCTION

Companies Act 1956 lays down that every company incorporated under this
Act must maintain or keep at its registered office different books and registers for
the purpose of records as well as to secure efficiency in operation. Some of books
have to be maintained compulsorily by all the companies under the various
provisions of Company Act. These are known as Statutory Books or Registers.

Statutory books are required to be maintained mainly with a view to
safeguarding the interest of shareholders. It is the duty of the Company Secretary
or Finance Manager of company to see that these books are maintained in
accordance with the provision of Act. Default to maintain any of these books
renders the company directors and secretary liable to penalties by Act.

Legal framework is an important constituent of business and corporate
environment. No corporate entity can effectively work and service without meeting
its legal obligation. The law relaying to company is perhaps the most significant
and all pervasive amongst the various corporate legislation.

In recent times there has been some change in subject and scope of company
law. The law relating to working and administration of companies has undergone
such structural changes that procedural requirement with respect to their
implementation have to be realigned.

P.G.DEPARTMENT OF STUDIES IN COMMRERCE, KARNATAKA UNIVERSITY, DHARWAD 1


Place of keeping Books of Accounts:
Section 209 requires every company to keep the books at its registered
office. However all or any of account may be kept at such other place in India as
the Board of Directors may decide when the Board so decides the company is
required within 7 days of such decision to file with the Registered Office a notice
in writing giving full address of that other place in Form No. 23AA along with
requisite filing fee.

Persons responsible for keeping the Books of Accounts:
Sub section (6) of section 209 specified the person who has been made
responsible for keeping of books of account and securing compliance by the
company with the requirements of section 209 of the Act, they are:

1. Managing Director or Manager and all officers and other employees of the
company, and
2. Where the company has neither a Managing Director nor Manager then
every Directors of the company are responsible.

Need for the study:
The transactions of the company must be recorded in some books or
registers. Therefore it is necessary to keep and maintain those books and registers
by the companies, at their registered office. The books and registers are the
statutory evidence of the activities of the companies. Maintaining books and
registers is obligatory on the companies registered under Companies Act, 1956.



“Register” means a register maintained in physical form or in any other form
as may be prescribed under the Act or the SEBI Act and rules, regulations and
guidelines framed there under from time to time.

Company secretary has crucial role in maintaining the books and registers of
a company. To study the secretarial duties in maintaining the books and registers,
the current study stands or reveals greater importance to further study purpose.
Therefore study of books and registers of a company a ‘greater significance in the
current scenario of competition’.

1. Need for selecting the subject i.e. statutory books and penalties to
understand the corporate environment.
2. To have a thorough knowledge about the statutory books and penalties of
company.
3. To understand the use of maintaining the statutory books and imposing
penalties.
4. To safeguard the interest of the shareholders.

5. It helps to record as well as to secure efficiency in operation.

Objectives of the study:
Some of the objectives of the study are as follows:

1. To identify the register, books, documents required to be maintained by a
company under various provisions of Company’s Act.
2. To highlight the contents of various registers, books, documents.
3. To identify the method of book keeping.
4. To verify the maintenance of books, registers, documents as per provisions
of companies Act.



5. To know the penal provisions for non maintenance of statutory books and
registers.
6. To know the preservation of statutory books and registers.
7. To know the relevance and effectiveness of the books and registers in the
companies registered under Companies Act 1956.

Importance of the study:
The importance of maintaining statutory books can be viewed from the
following points:

1. It has great impact on the structural health of the organization.
2. Marinating the books and records will help to know the efficiency of the
business.
3. It helps to secure interest of the shareholders.
4. It helps to improve the credit worthiness of the company.

Limitations of the study:
The important limitations of the study are as follows:

1. It is difficult to collect all the confidential data and information.
2. The time to undergo the in-plant training was not sufficient to study the
aspect of the organization.
3. The study is completely depending on the published document which
reflects financial position on the last date of the accounting period. That
means financial position throughout the year is not considered.
4. The study done is the project work was not purely for academic purpose
only.



Methodology:
The study is done basically on the data obtained from the discussions with
the company secretary and also by the finance officer. The officially and other
personnel in the corporate department provided full information regarding the
statutory books and registers of the company.

For the purpose of collecting the data the researcher administered by the
officially by the company to get the required information during this project report
work researcher had met the company secretary of the company to collect the
required data regarding the report.

The data collected are divided into two parts primary data and secondary
data. Primary data are collected directly from the discussion with the company
secretary, financial manager, and with some officials of the company during the
project work researches.

And secondary data are collected information. Secondary data are collected
from journals, magazines, books and articles, etc which were published time to
time.



Research Design:
The whole research work is divided into 5 chapters. The chapters are
arranged in a sequential order.

Chapter I:

The first chapter is “Introduction” which consist need and scope of the
study, objectives of the study, research methodology and research design.

Chapter II:

The second chapter focuses on introduction of the company i.e. “Profile of
the Miven Machine Tools Limited”.

Chapter III:

The third chapter focuses on “theoretical concept” of statutory books and
registers and A Case study.

Chapter IV:

The fourth chapter is concerning to the “Analysis and Interpretation of data”
it contains the books and registers maintained by the Miven Machine Tools
Limited.

Chapter V:

Finally the fifth chapter is “conclusion part”, which is oriented towards to
the findings and suggestions.



Chapter-II

INTRODUTION:

MIVEN MACHINE TOOLS LTD. stands tall with pride to be a company
that manufacture. CNC (Computerized Numerical Control) turning machine of
world-class technology. This company was earlier known as KWS (Kirloskar
Warner and Swasey), which was a joint venture between Mysore Kirloskar and
Warner and Swasey Company of United States of America. The highly visionary
of the Indian industry Mr. Shankar Rao Kirloskar founded the company. Right
from its genesis, the company has taken strides with amazing pace is confidence by
introducing of state of art turning machine.

Looking at the outstanding growth of company, Gidding and LEWIS
INC.USA (G and L) found this to be a lucrative venture and vase to cater south
East Asian countries, attracted it under its wing during 1998. The company joined
the Gidding and Lewis family. Subsequently, in year 2002, M/s N.A.Sirur private
limited (NASPL), acquired the major stake in G and L renamed it as MIVEN
MACHINE TOOLS LTD., NASPL is a group of company founded by Mr. Vivek.
Raghavesh Sirur in the year 1981. NASPL (MIVEN GROUP) is a pioneer in the
area of manufacturing of industrial equipment, chip conveyors , coolant filtration,
disposal system, software, investment and trading etc. their associate companies to
name a few are Miven Mafran Conveyors pvt ltd, Cotmac pvt ltd.

At Miven Machine Tools, they have an extremely structured approach while
offering the expertise to clients. They first affer consultation facility to
requirement. Then the manufacturing engineer experts shall designs and install the



right technologies for the concerned application. Their range machines have the
flexibility to evolve into the exact level of capability needed. Their infrastructure
on machine and material is one of their strongest points. They believe that the tools
and the craftsman should be as his skill. It is on the best software device that high
precision and optimum quality of product can be experted. In view of this, they are
equipped with high quality machines to produce world class technology. The
company stands among the elite few whose designs conveniently / conventionally
used for for CNC machine world over. The after sales service will show that they
are aware of the values of time and timely solutions. They prove to potential in
their approach to their customers of all levels. They assure on with the assistance
of expertise at every possible way and also provide with a total solution at any
time.

The company is committed to provide state-of-art machine machine tools
that are reliable and are building to high degree of excellence. They believe in
enhancing customer’s satisfactions by continuously improving efficiency of the
application system and service. The company believes in professionalism and
promoting ownership among all its members.

It is believed that all the employees works for the entire progress and growth
of the company. The company has worked long since, to explore the possibilities
of places of these machine tools all over India. The company has recorded
immense growth ever since its establishment the quality control measures initiated
by the company was appreciated from time to time. The company believes in
group efforts and brings together the intellectual from the national and
international level.



Though the growth of the industry and the recession trends have hurdled the
stride of the company over the years, the company have overcome these hurdles
and in a journey to mark the success. The outlook of the company to enter into new
market segments have being opened up. The expansion programs of the
management are in full swing. The future to bright and rewarding.

COMPANY DATA
DATE OF INCORPORATION : 19th July 1985
DATE OF COMMENCEMENT : 2nd September, 1985
REGISTRED OFFICE : Gokul Road,
Hubli-580030.
Karnataka.
FACTORY LOCATION : Tarihal Industrial Area,
Hubli-580030.
Karnataka.
FINANCERS : The Sham Rao Vithal
Co-Operative Bank Ltd.,
INDUSTRY : Miven Machine Tools
AREA OF OPERATION : Karnataka.
REGISTER NO : 14(84)
PROMOTER : Promoted by the Mysore
Kirlosker Ltd,

EXECUTIVE VICE-CHAIRMAN : Dinkar N. Upponi (Chair person)
BOARD OF DIRECTORS : Vikram R. Sirur, Sham Sirur
Uday Kamat, Mukund Muley



A R Menon- Executive Director

EXECUTIVE (FIN& ADMN) : V N Hasalkar
AND COMPANY SECRETARY

AUDITORS : B K Ramadhyani & Co
Bangalore.

BRIEF HISTORY OF MMTL:

MIVEN MACHINE TOOLS LIMITED “was incorporated on 19th July 1985
in the state of Karnataka with its registered office at Gokul Road, Hubli which was
subsequently shifted to present address at Tarihal Industrial Area, Hubli. The
Mysore Kirloskar Ltd., (MKL) promoted MMTL, in technical and financial
collaboration with the WARNER AND SWASEY COMPANY. The name of the
company was KIRLOSKAR SWASSEY LIMITED. The collaboration agreement
provided for manufacture of two models of computer numerically controlled
turning machines, namely WSC-8 and WSU-12. During September 1998,
WARNER AND SWASEY acquired the 38% share held by Co-Promoter
Company, and it’s holding to 76%.

At the time of incorporation, each promoter company held 11, 40, 000 shares
amounting to Rs 1, 14, 00,000 of the paid-up capital. The shares held by
WARNER AND SWASEY were traded to Fadal Engineering Company (FEC),
subsidiary of GIDDINGS AND LEWIS COMPANY LTD, USA.



On account of this the name of company was changed to GIDDING AND
LEWIS COMPANY LTD, from KIRLOSKER WARNER AND SWASEY LTD.
Effective 23rd July 1999 vide fresh certificate of incorporation was issued by the
registered of company, Bangalore. The share (76%) held by FADAL engineering
company including USA, subsidiary of GIDDING AND LEWIS LTD, USA were
acquired by N A Sirur (Hubli) pvt ltd.

The board of director reconstituted on 30the March 2002. Further, NASPL
acquired 10% share held by public. As of date NASPL holds 80% in the equity
capital of the company and public holds the balance. On account of this, the name
of the company was changed to MMTL form GIDDING AND LEWIS industry
Ltd, effective on 26the July 2002. Vide fresh certificate of incorporation issued by
registered of company, Bangalore.

The share of the company are listed at Bangalore, Mumbai and Delhi stock
exchanges.

Six directors on its board manage the company. One among them has been
appointed as executive director to look after the day-to-day affairs of the company.
The details include that qualified and experienced executive manage the company.
Mr.Shyam S Kirlosker, who joined in April 1988 as a president of the company
was in charge of the whole activities of the company. He retired on 16th October
2000. Subsequently Mr. A R Menon, the executive vice president continued to
look after the affairs of the company. In the board meeting held on 27th June 2002
promoted and appointed Mr. A R Menon as executive director of the company. Mr.
A R Menon is Bsc (Eng). He has been with the company since inception in various



positions. He has about 27 years of experience in the field of engineering
industries. Mr.D.N.Upponi Chairman of the Company. The Board is consisting of
the following directors: Mr. Vikram Sirur –executive vice Chairman, Mr. Shyam
Sirur- Director, Mr. Uday kamat-Director, Mr.Mukund Muley-Director.

The capital structure includes an authorized capital of Rs. 300 lakh at the
time incorporation in 1985, and was raised to Rs. 400 lakh in 1989 divide in Rs.
40-lakh-equity share of rupees 10 each. During 2000-01, the authorized capital
increased to 500 lakh and divided into 50-lakh-equity shares of rupees 10 each by
creation of additional 10-lakh-equity share. The present paid up capital is Rs.
30035000 (divided into 3003500) equity shares of 10 each fully paid.

The company was allotted 21.5 acres of land by Karnataka area development
board (KIADB). The company land was allotted on (lease cum sale) basis for a
period of 11 years. The factory building consists of 30000 Sq.ft build up area
consisting of 10000 Sq.ft.

Objectives of Miven Machine Tools Ltd:

Miven Machine Tools ltd is a ISO 9001 certified company their quality
objective includes
• Enhance customer satisfaction.
• Provide cost effective product
• Reduction of product realization time standard products.



Product Profile
Currently the company is manufacturing CNC Turning Machine of the
following models:
• Universal model (WSU-12 & WSU-15) Bed length range 1000mm to
2000mm
• Chucking Model (C-300, C-400, C-500)
• Ultra series (Universal Ultra and Chucker Ultra) bed length range 500mm to
300mm
• Universal model (WSU-40) bed length range 1000mm to 3000mm
• Venus 160 and Venus 200 CNC Turning machine.

These product find their usage throughout the country and serve industrial
sector like defense, railway, automobile, tractor, heavy and general engineering’s.

The machine are used for high precision work in both private and
government industries. In private automobile sector TELCO AND ASHOK
LEYLAND are major customer with the ESCORT GROUP in the tractor section
HINDUSTAN MOTORS is the other company in the automobile sector finding the
utility of machine to greater extent.

The company has sold large number of machines to BHARAT EARTH
MOVERS LTD & BHARAT FORGE LTD engineering companies like
KIRLOSKER OIL ENGINE LTD, KIRLOKER BROTHER LTD, SHIVAJI
WORK LTD, KIRLOSKER ELECTRICAL COMPANY, SIEMENS LTD,
WIPRO FLUID POWER, AUDCO INDIA LTD etc. have also included these
machines in their production set up.



In government sector ordinance factories at Ambajhari, Medak & Kanpur,
Field Gun Factory Kanpur, Gun and Shell Factory Cossipur Kolkata, Gun Carriage
Factory Jabalpur, Heavy Vehicle Factory Auadi, MTPF Mumbai Indian Railway
etc. so for about 215 machines have been sold in the Indian market through the
excellent performance of these machines and services back up company is able to
create a line of happy customer.

Company operation is manufacturing and assembling oriented critical
components required for assembly are produced from various vender located in
Bangalore and source of other suppliers situated in and around Hubli, who have the
necessary technology to deliver the components. The company user LASER
ASSEMBLY TECHNIQUES and has unique process of ASSEMBLY USING
EPOX, which is a specialty of a company.

DEPARTMENTS IN THE COMPANY:
1) Assembly or production Department
2) Marketing and Sales Department
3) Engineering Department and
4) Finance, Secretarial and Account Department



ORGANISATION CHART RESPONSIBILITIES & AUTHORITIES

BOD

EXECUTIVE

MR

I/C PER
EXECUTIVE &ADMN
IC FIN,A/C
FIN/ADMN/CS
I/C PER &
Executive-QC I/C-QC LEGAL

Sec.Manager-
Executive- Materials
Operations
I/C Maintenance

I/C Servicing I/C Assembly

I/C Design
Executive-ENGG Mech, Elect &
Electronics’

I/C Manufacturing
Engg.
Executive-MKT
I/C Busi Pro & Sales



Chapter – III

STATUTORY BOOKS AND PENALTIES

MEANING OF STATUTORY BOOKS:
The Company Act, 1956 lays down that every company
incorporated under this Act must maintain an keep at its registered
office certain books, registers and copies of certain returns,
documents etc. and to give certain notices, life certain returns,
forms, reports documents etc. with the Registrar of companies
within certain specified time limits and with the prescribed filing
fees. These books are known as statutory Books. Some of the



statutory registers are required to be kept open by the company for
inspection by directors, members, creditors of the company and by
other persons. The company is also required to allow extracts to be
taken from certain documents, registers, returns etc. and furnish
copies of certain documents on demand by a member or by any
other person on payment of specified fees.

Every company incorporated under the Act is required to keep
at its registered office, inter alia, the following books and registers.
1. Register of investment in securities not held in company’s
name. (Section 49(7))

2. Register of deposits.{ Section 58A and the companies
(Acceptance of Deposits Rules, 1975 and the RBI Non
Banking financial Companies Directions}

3. Register of securities bought back (Section 77A)

4. Register of charges (Section 143)

5. Register and Index of members. {Sections 150,151, and the
companies (issue of Share capital with Differential Voting
Rights ) Rules, 2001 }

6. Register and index of debenture holders (Section 152)

7. Register and index of beneficial owners (Section 152A)

8. Foreign register of members and debenture holders and
their duplicates. {Section 157 (1) and 158 (4)}



9. Annual Return (Section 163)

10. Books containing minutes of general meeting and of
Board and of committees of Directors. {Section 193 (1)}

11. Register of Postal Ballot {Section 192A and the companies
(Passing of the resolutions by postal ballot)Rules, 2001}

12. Books of accounts {section 209(1) (a) to (c)}

13. Cost account records for companies engaged in
industries so specified by central government { Section
209(1)(d)}

14. Register of contracts with companies / firms in which
directors are interested. {Section 301 (5) }

15. Register of Directors / Managing Director/Managers /
Whole –time Directors/ Secretary.(Section 303 )

16. Register of directors’ shareholdings. (Section 307)

17. Register of loans or investments made, guarantees given
and security provided to other body corporate, (Section
372A)

18. Register of Renewed and Duplicate share Certificates. { Rule
7 of the Companies (Issue of share Certificate ) Rules,1960}

19. Register of records and documents destroyed {Section 163
and the companies ( Preservation and Disposal of Records )
Rule, 1966}



20. Register of sweat equity shares { Section 79A and the
Unlisted Companies (Issue of Sweat Equity shares ) Rule,
2003}

21. Dividend Register.

TYPES OF STATUTORY BOOKS / REGISTERS

(1) Register of Investment Not Held in Company’s Name:



Section 49 of the Act provide that the investments of a
company must be held in its own name, except as allowed by Sub
Sections (2),(3), (4) and (5) of the Section. It is stated that, if any
shares or securities in which investments have been made by a
company are not held by it in its own name, the company shall
forthwith enter in a register maintained by it for the purpose:
(a) The nature, Value and such other particulars as may be
necessary to fully identify the shares or securities in question;
and

(b)The bank or person in whose name or custody the shares or
securities are held.

The register should be maintained at the registered office of
the company. This register has to be kept open for the inspection of
any member or debenture holder of the company during the
business hours of the company, without paying any charge, during
business hours, subject to such reasonable restrictions as the
company may, by its articles or in general meeting, impose, so that
not less than two hours in each day are allowed for inspection. Only
one person at a time should be allowed to inspect the register.

If default is made in the maintenance of the register, the
company every officer of the company who is in default, shall be
punishable with fine which may extend to fifty thousand rupees. If
inspection required (as mentioned above) is refused the company
Law Board’s may, by direct an immediate inspection of the register.



Entries in the register should be authenticated by the
secretary of the company or by any other person authorized by the
board for the purpose, by appending his signature to each entry.

The register should be preserved permanently and should be
kept in the custody of the secretary of the company or any other
person authorized by the Board for the purpose.

(2) Register of Deposits:
As per Rule 7 of the Companies (Acceptance of Deposits)
Rules, 1975 every company other than a banking company
accepting deposits has to keep a at its registered office one or more
registers in which there shall be entered separately in the case of
each depositor the following particulars, namely :
(a) Name and address of the depositor and details of nominee,
if any;

(b)Date and amount of each deposit;

(c) Duration of deposit and the date on which each deposit is
repayable;

(d)Rate of interest ;

(e) Date/dates on which payment of interest on the deposits is
to be made;

(f) Any other particulars relating to deposit.



The register should be maintained deposit receipt number –
wise.

The register of deposits is required to be preserved in good
order for a period of not less than eight calendar years from the
financial year in which the last entry is made in the register.

If default is made the company and every officer of the
company in default shall be punishable with fine up to Rs. 500/-
each and further fine of Rs. 50/- per day if default continues.
Register of deposits can be taken to be a part of books of accounts
within the meaning of Section 209. Hence, where the work
regarding fixed deposits is entrusted to a registrar by a company, it
is advisable for the board to approve of keeping the said register
with the registrar and file a copy of the said resolution with the
ROC.

As per Rule 4 (16) of the Non Banking Financial Companies
(Reserve Bank) Directions, 1998, every non-banking financial
company shall keep one or more registers in aspect of all deposits
in which the particulars of each depositor shall be deposits
accounts opened by that branch of the company and a consolidated
resister at the registered office of the company. The Register shall
be preserved in a good order for a period of not less than eight
calendars years following the financial year in which the latest entry
is made. However, if the company keeps the books of accounts



referred to in sub-section, it shall be deemed to be sufficient
compliance with the clause if the register aforesaid is kept at such
other place, subject to the condition that the company delivers to
the Reserve bank of India’s copy of the notice filed with the
Registrar of companies under the proviso that sub-section within
seven day of such filing.

The Registrar is not open for inspection.
Board for the purpose, by appending his signature to each entry.

The register should be kept in the custody of the secretary of
the company or any other person authorized by the Board for the
purpose.

(3) Register of Securities Bought Back:
Under this section 77A(9) every company is required to keep
at its registered office a register of securities bought back and enter
therein the following particulars namely.
i. The consideration paid for securities bought back.

ii. The date of cancellation of securities;

iii. The date of extinguishing and physically destroying of
securities and such other particulars as prescribed in form No.
4B of the Companies (Central Government) General Rules and



forms, 1956 and Annexure B to the private limited Company
and unlisted Public Limited Company (Buy-back of Securities )
Rules, 1999.

Entries in the register should be made in chronological order.
If the company fails to maintain this register then the
company and every officer of the company who is in default shall
be punishable with fine which may extend to fifty thousand rupees,
or with imprisonment for a term which may extend to two years, or
with both.

The register is not open for inspection.
secretary of the company or by any other person authorized by any
other person authorized by the Board for the purpose, by appending
his signature to each entry.

The register should be preserved for minimum period of 8
years from the date of completion of buy-back and should be kept
in the custody of the secretary of the company or any other person
authorized by the Board for the purpose.

(4) Register of Charges:



Under Section 143, every company is required to keep at its
registered office a Register of charges and enter therein all charges
specifically affecting property of the company and all floating
charges on the undertaking or any property of the company. The
Register should contain the following:

A short description of the property charged;
 The amount of the charge;

 Except in the case of bearer securities, the names of the
parsons entitled to the charge; and

 Particulars of any modification of a charge and every
satisfaction of a charge.

Entries in the register should be made in chronological order
of creation of the charge and modification thereof.

If any officer of the company knowingly omits or willfully
authorizes or permits the omission of any entry required to be made
as per the Act, he is punishable with the which may extend to five
thousand rupees.

Under Section 144, the register of charge and instruments
creating charge shall be open for inspection by any member or
creditor without fee and of any other person on payment of fee of
such sum as may be prescribed, during business hours for not less
than two hours each day. The central Government has vide



notification dated 13-7-88 w.e.f. 15-7-88, prescribed a fee of Rs 10
for inspection of this register by persons other than members and
creditors. However, company is not required to supply copies of
these. If default is made, the company and every officer in default
is punishable with fine up to rupees five hundred each and further
fine of rupees two hundred for each day during which the refusal
continues.

In the wake of MCA-21 project, the physical data of the
companies in Registrar of companies is being digitized. The
documents, in so far as these are available in digitized form, shall
be available for public inspection through electronic means using
the internet.

The company Law Board* nay also by order compel an
immediate inspection of the said copies or register.

Instrument creating a charge should be preserved for a period of 8
years from the date of satisfaction of charge and should be kept in
custody of the secretary of the company or any other person



(5) (a) Register of Members :
Every company is required to maintain a register of members,
which should indicate the following particulars:
 Name, address and the occupation of the member;

 Date on which he was entered as a member;

 Date on which he ceased to be a member;

 The details of the shares standing in his name, such as,
the number of the certificate, distinctive number of the
shares, etc.

In addition to the aforesaid particulars the register of
members should also be in conformity with the format as
prescribed under Rule 7 of the companies (Issue of Shares
certificates ) Rules, 1960. The Appendix to the rules provides the
format of register of members. In the case of Joint shareholders,
the particulars of each joint holder should be recorded in the
register.

Separate register should be maintained for each class of equity
and preference shares.



Apart from the aforesaid information, this format provides for
giving information about cash payable on shares, cash paid on
shares and full particulars of transfer of shares. Further, all entries
in this register are required to be authenticated by the secretary or
any other person so authorized by the Board of Directors [Rule 7 of
the companies (Issue of Share Certificate) Rules, 1960.

Further particulars of every share certificate issued in
accordance with rule-4, sub-rule (1), shall be entered in the
Register of Members maintained in the form set out in the appendix
annexed to the above said rules of persons, to whom it has been
issued, indicating the date of issue.

Under section 163 of the companies Act, 1956, register of
members should be kept at the registered office of the company and
except when it is closed under the provisions of the Act, shall open
during business hours (subject to such reasonable restrictions as
the company may impose, so that not less than two hours in each
day are allowed for inspection) to inspection of any member of
debenture holder without fee, and of any other person, on payment
of such sum as may be prescribed for each inspection. The Central
Government has vide notification dated 13-7-88 w.e.f. 15-7-88
prescribed a sum of Rs. Ten for inspection hereunder. Further, the
member or debenture holder or other person may make extracts
from the register, index, etc. without fee or require a copy or any
part thereof on payment of such sum as may be prescribed fir



every 100 words or part thereof required to be copied. Vide
Government’s notification dated 13-7-88 w.e.f. 15-7-88 the sum
prescribed for requiring a copy of the register as above is, rupee one
for every 100 words or part thereof.

A member can obtain or requisition copies of register of
members only on prescribed payment and a mere request to
chairman by letter is insufficient. [Maknam Investments Ltd. In re
[1996]87 Comp. CAS 689 (Cal.)].

(5) (b) Index of Members :
Every company having more than 50 members must maintain
an index of members, unless the register of members in itself
constitutes an index. The index may be a card index or bound one.
Any alterations or changes made in the register of members must
be recorded in the index within 14 days. The provisions of
inspections and getting copies of the register of members as
discussed above are applicable to index of members also.

(6) (a) Register of Debenture holders :
Section 152 requires every company to maintain a register of
debenture holders and enter therein the following particulars.
 The name and address , and the occupations, if any, of each
debenture holder;



 The debentures held by each holder, distinguishing each
debenture by its number, except[t where such debentures are
held with a depository and the amount paid or agreed to be
considered as paid on those debentures;

 The date on which each person was entered in the register as
debenture holder; and

 The date on which any person ceased to e a debenture holder.

In this case of joint holding, the particulars of each joint
holder should be kept in the register.

No notice of any trust, express, implied or constructive, should
be entered in the register of debenture holders.

Except when the register is closed under the provisions of the
Act as aforesaid, the register along with index should be open for
inspection during the business hours of the company, subject to
such reasonable restrictions as the company may impose by its
articles or in general meeting so that not less than 2 hours in each
working day of the company are allowed for inspection.

Members, debenture holders and trustees of debenture
holders can inspect the register and the index without payment of
any fee and any other person can inspect the register on payment
of the requisite fee.



Copies of the register can be demanded by any person who
inspects the register.
Entries in the register and index should be authenticated by
the secretary of the company or by any other person authorized by
the Board for the purpose, by appending his signature to each
entry.

The register and index should be preserved for a period of 15
years from the date of redemption of debentures and should be kept
in the custody of the secretary of the company or any other person

Further the provisions of sections 111 and 111A shall apply in
relation to the rectification of the register of debenture holders as
they apply in relation to the rectification of the register of members.

(6) (b) Index of Debenture holders :
As in the case of a register of members,, there must be kept an
index of debenture holders where a company has more than 50
debenture holders. Similar provisions apply to it as to an index of
members

(7) Register and Index of Beneficial Owners:
Section 152A of the companies Act, 1956 was inserted by the
Depositories Act, 1996 w.e.f. 20-9-1995, providing that the Register
and Index of Beneficial Owners maintained by a depository under



section 11 of the depositories Act, 1996 shall be deemed to be a
register of members and debenture holders, as the case may be, for
the purposes of this Act. The amendment was considered necessary
as securities held in depository mode are fungible.

Section 11 of the Depositories Act, 1996 provides that every
depository shall maintain a register and an index of beneficial
owners in the manner provided in sections 150, 151, 152 of the
companies. Act,1956.

(8) Foreign Register of Members and Debenture Holders:
The foreign register of members or debenture holder’s resident
outside India, if maintained, shall be deemed to be a part of the
register of members or debenture holders of the company and
should be maintained from the date of allotment of shares or
debentures to foreigners, in an office located in the foreign country.

The company should, within 30 days from the date of the
opening of any foreign register, file with the Registrar of Companies
a notice of the situation of the office where such register is kept. In
the event of any change in the situation of such office or of its
discontinuance, the company should, within 30 days from the date
of such change or discontinuance, file notice of such change or
discontinuance with the registrar of Companies.



If a foreign register is maintained, a duplicate thereof should
be maintained at the registered office of the company or at such
other place where the register of members or debenture holders is
kept.

Where a company closes its foreign register of members or
debenture holders, it should give not less than 7 days previous
notice by advertisement in a vernacular newspaper circulating in
the district where the foreign register is kept.

Except when the register is closed under the provisions of the
Act as aforesaid, the register should be open for inspection during
business hours, subject to such reasonable restrictions as the
company may impose by its articles or in general meeting so that
not less than 2 hours in each working day are allowed for
inspection.

Members or debenture holders can inspect the register
without payment of any fee and any other person can inspect the
register on payment of the requisite fee.




Entries in the foreign register should be authenticated by the
person in charge of the office in the foreign country, by appending
his signature to each entry.
The register should be kept in the custody of the person in
charge of the office in the foreign country.

The foreign register of members should be preserved until
discontinued.

The foreign register of debenture holders should be preserved
for a period of 15 years from the date of redemption of debenture.

(9) Annual Return:
Annual Return is perhaps the most important document
required to be filed by every company with the Registrar. Apart from
the balance Sheet and Profit and Loss Account, this is the only
document to be compulsorily filed with the Registrar every year. The
importance of this document can best be highlighted by comparing
it with some other documents required to be field under the Act.

Annual Return and Balance Sheet: While the Balance Sheet
and Profit and Loss Account given information on the financial
performance of a company, it is the Annual return which gives
greater insight into the company relating to the people behind a
corporate entity – the shareholders, who as a body, constitute its
ownership, the Directors, who exercise control over the affairs of the



company, the extent of dilution or concentration of ownership, the
details of debenture holders, who have contributed to the loan
funds, the extent of indebtedness, and last but not the least, the
company Secretary who is the conscience-keeper of the company.

Further it contains more up-to-date information than that of
the latter. Section 210 of the Act, requires that normally, the
Balance Sheet and the Profit and Loss Account should be placed
before the Annual general Meeting within six months of the
financial year ending, and section 220 provides that copies of
Balance Sheet and Profit and Loss Account should be filed within
30 days from the date on which the balance sheet and the profit
and loss account were so laid (whether adopted or not) or where
the annual general meeting has not been held, within 30 days of
the latest date on or before which the annual general meeting
should have been held. This means that the information contained
in the Balance Sheet is at least half an year old by the time it is
open for public inspection. On the other hand, the Annual Return is
made up to the date of the Annual General Meeting, and should be
filed within 60 days from that date.

Annual Return and other Documents: Other documents have
to be filed with the Registrar of Companies only on the happening of
certain events. For instance, e-Form No. 2 has to be filed only when
the company allots shares. E-forms No. 8 only in case of creation
and modification of charge, under section 135 of the Act, e-Form



No. 17 only in the case of satisfaction of charge. E-Form No. 32 only
in case of change in particulars of directors and so on. But in the
case of Annual Return, it has to be compulsorily filed every year,
independent of any contingency. Further, the particulars of many
other documents filed during the year are summarized and included
in the Annual Return.

Thus, the Annual Return provides in a nutshell, every
comprehensive information about various aspects of a company
updated till the date of Annual General Meeting every year. It is not
an exaggeration, therefore, to state that the study of Annual Return
provides bird’s eye view of the capital structure, constitution and
management of the company concerned.

Sub-section (1) of Section 159 prescribed the details that
should be furnished in the Annual Return of a company having a
share capital.
They are:
a) The address of its Registered Office.

b) Register of Members and Debenture holders.

c) Summary of the details of its share capital and debentures.

d) The indebtedness of the Company.

e) Details of its Members and Debentures holders, past and
present.



f) Details of its Directors, Managing Directors, Manager and
Secretary, past and present

In respect of details of past and present members it is
necessary to give the full details only once in six years. For the
intervening period of five years, it is adequate if only the details of
changes are given.

The Format of Annual Return is prescribed in Part II of
Schedule V to the Act [section 159 (2)]. The Same sub-section also
allows certain amount of flexibility in the format by stating that
Return should conform to the prescribed form or, “as near thereto
as circumstances admit”. This means that if any information
required to be given in the Annual Return does not fit into the
format, necessary modifications may be made in the format by the
company concerned.

The Annual Return should be made up to earlier of the
following dates:
I. The date of the latest Annual General Meeting ; or

II. The latest date on which the Annual General Meeting of the
company should have been held under the provisions of
section 166 of the Act.

The date under (II) above is applicable only in case the
company fails to hold the Annual General meeting within the time
prescribed under section 166 of the Act. In other words, if the



company has not been able to hold the Annual General Meeting
within the time prescribed under section 166, it will be required,
nevertheless to prepare the Annual Return made up to the latest
allowed date for holding the Annual General Meeting under that
section and file it with the Registrar.

The only exception to this rule is in case of an extension of
time for holding the Annual General Meeting granted by the
Registrar.

Annual Return is required to be attached with the e-form 20B
with in 60 days from the date of the Annual General Meeting and if
no Annual General Meeting is held then within 60 days from the
date on which the AGM ought to have been held.

In case the Annual General Meeting is held and adjourned, the
Annual Return should be made up to the date of the original
meeting.

The Annual Return should be signed by two officers of the
company consisting of:
i. The Manager or Secretary of the company; and

ii. A Director of the company.



If the company does not have a Manager or Secretary, the Annual
Return should be signed by two Directors, one of whom should be
the Managing Director, where there is one.
Thus, it can be seen that the primary responsibility for signing
the Annual Return is vested in the Manager or Secretary of the
company as also the Director / Managing Director. It is customary
for the Secretary to sign the Annual Return in the case of
companies where there is a Secretary, though he is bracketed along
with the Manager. Only in cases where a company does not have
Secretary, the Return is to be signed by two Directors including a
Managing Director, where there is one.

In addition to the above officers to the company, the proviso to
section 16(1) of the Act requires that the Annual Return should also
be signed by a Secretary in whole-time practice, in the case of
companies whose shares are listed on a recognized Stock Exchange.

Section 162 of the Act, prescribes penalty where a company
fails to comply with any of the provisions contained in Sections 159,
160, or 161. Accordingly, the company and every officer of the
company who is in default shall be punishable with fine which may
extend to Rs. 500/- for every day during which the default
continues.

Section 628 deals with penalty for false statements. According
to this section, if in any return, report, certificate, balance sheet,



prospectus, statement or other document, required by or for the
purposes of any of the provisions of the Act, any person makes a
statement-
a) Which is false in any material particular, knowing it to be false
; or

b) Which omits any material fact, knowing it to be material;

He shall except as otherwise expressly provided in the Act, be
punishable with imprisonment for a term which may extend to two
years and shall also be liable to fine.

Every company should maintain copies of all annual returns
along with copies of certificates and documents required to be
annexed thereto at the registered office of the company.

The copies of annual returns and certificates required to be
annexed thereto should be open for inspection during the business
hours of the company, subject to such reasonable restrictions as
the company may impose by its articles or in general meeting so
that not less than 2 hours in each working day of the company are
allowed for inspection.
Members or debenture holders can inspect the annual returns
without payment of any fee and any other person can inspect the
annual returns on payment of the requisite fee.



Copies of the last 8 annual returns and all certificates and
documents required to be annexed thereto should be preserved in
the custody if secretary of the company or any other persona

(10) Minutes Books:
Every company must maintain minutes books for recording
the minutes of proceedings of all general meetings of the
shareholders and of all proceedings of every meeting of its Board of
directors or every committee of the Board (Section 193). The
minutes must be entered in the minutes book within 30 days of the
meeting. The pages of a minutes book must be consecutively
numbered. Each page of the minutes book must be initialed and the
last page of the record of proceedings of each meeting in the
minutes books must be dated and signed.
 In the case of minutes of Board or Committee meetings by the
Chairman of the side meeting or of the next meting; and

 In the case of minutes of general meetings by the chairman of
the same meeting within 30 days of the meeting and in the
event of his death or inability of that chairman within that
period, by any director so authorized by the board for the
purpose.

The minutes books should be kept at the registered office of
the company. These are primary documents and an evidence of the
proceedings recorded their in and when the minutes are duly drawn



and and signed, presumptions as specified in section 195 of the Act
may be drawn until the contrary is proved.

According to sub-section (4) of section 193, in the case of
Board meeting or of a committee of the Board the minutes shall also
contain –
 The same of the directors present at the meeting; and

 In the case of each resolution passed at the meeting, the
names of the directors, if any, dissenting from, or not
concurring in, the resolution.

Sub-section (5) of the section prohibits the inclusion in any
minutes of any matter, which, in the opinion of the chairman of the
meeting-
• Is or could reasonably be regarded as defamatory of any
person;

• Is irrelevant or immaterial to the proceedings; or

• Is detrimental to the interest of the company.

It has been explained at the end of this sub-Section that the
chairman shall exercise an absolute discretion in regard to the
inclusion or non-inclusion of any matter in the minutes on the
grounds specified in this sub-Section.

Sub-section (6) imposes a fine of five hundred rupees for
default in complying with the provisions of Section 193.



Section 193 of the Companies Act, 1956, envisages minutes to
be kept in a book. However, the Department of Company Affairs ha,
by its letter No. 16047/TA.VII, dated 16th December, 1972, clarified
that the minutes can be maintained by a company in the loose-leaf
form, provided it complied with the other procedural requirements
of the section and at the same time took all possible safeguards
against manipulation or interpolation of the minutes and bound up
the loose-leaves in nooks at reasonable intervals, say, six months.

Section 194 lays down that the minutes of meetings kept in
accordance with the provisions of Section193 shall be evidence of
the proceedings recorded therein.

According to Section 195of the Act, where minutes of
proceedings of any Board / committee / general meeting have been
kept in accordance with the provisions of Section 193 of the Act,
the, until the contrary is proved, the meeting shall be deemed to
have been duly called and held, and all proceedings threaten to
have duly taken placer, and in particular all appointments of
directors or liquidators made at the meeting shall be deemed to be
valid.

Section 196 requires that the minutes books or proceedings at
general meeting must be kept open for inspection at the registered
office of the company for at least two hours everyday. A member can



ask for a copy of the minutes at a notice of 7 days on payment of
such sum as may be prescribed for every hundred words or fraction
thereof. The Central Government has vide notification dated
13-7-88 w.e.f. 15-7-99 prescribed a sum of Re. 1 for every 100
words for taking a copy of the minutes herein. However, the minute
books of Directors’ meeting cannot be inspected by the members.

In case of refusal the company, and officer of the company
shall be liable to a fine up to Rs.5000/- . In case of such refusal,
the company Law Board may, by order, compel an immediate
inspection of the minute books or direct that the copy required shall
forthwith be sent to the person requiring it. The minute books of
directors’ meetings are not available for inspection, except to
directors.

(11) Register of Postal Ballot [Section 192A and the companies
(Passing of the resolutions by postal ballot) Rules, 2001]:
As per Section 192A, a listed public company shall, in the case
of resolutions relating to such business as the central government
may, by notification, declare to be conducted only by postal ballot,
get such resolutions passed by means of a postal ballot, instead of
transacting the business in general meeting of the company. In
respect of resolutions not specified by the Central government, a
listed company may at its discretion get the resolution passed by
postal ballot.



Section 192A read with Rule 5(e) Companies (Passing of the
resolutions by postal ballot) Rules, 2001, the scrutinizer shall
maintain the register of postal ballot in which there shall be entered
the following.
a) Particulars in respect of consent or dissent received, including
electronic media.

b) Name and address of shareholders.

c) Folio number

d) Number of shares held

e) Nominal value of shares.

f) Whether the shares have voting rights (differential voting or
non-voting rights)

Scrutinizer shall also maintain record for postal ballot which
are received in defaced or mutilated form.

In addition to aforesaid particulars the register of postal ballot
should also be in conformity with the Companies (Passing of the
Resolutions by Postal Ballot) Rules, 2001. The Appendix to the rules
provides.
a. Method of sending notice,

b. Applicability of rules,

c. The list of businesses in which the resolutions shall be passed
through postal ballot,



d. Procedure to be followed for conducting business through
postal ballot.

The register, postal ballot forms and all other related records
are not available for inspection.
All postal ballot forms should be authenticated by the
scrutinize. Entries in the register should be authenticated by the
Scrutinizer.
Register of postal ballot should be kept at the registered office
of the company and will be kept under the safe custody of the
scrutinizer till the chairman considers, approves and signs the
minutes of the meeting. Thereafter, the scrutinizer shall return the
register to the company so as to preserve such register safely till the
resolution is given effect to.

The Scrutinizer’s report and office copies of he notices should
be preserved in good order until the resolution has been
implemented or for a period of 10 years. Which is later.

(12) Books of Account:
Section 209(1) of the Act states that a company shall maintain
such books as will give a true and fair view in respect of:
a) All sums of money received and expended by the company and
the matters in respect of which the receipts and expenditures
takes place;

b) All sales and purchases of goods by the company; and



c) All assets and liabilities of company ; and

d) Such particulars regarding utilization of material or labor or
other items of cost as may be prescribed by the Central
Government in respect companies which are required to keep
cost accounts.

These books must be preserved for a minimum period of 8
years immediately preceding the current year. The books are open
to inspection by directors. Under Section 209A the Registrar and
officers authorized by the Central Government and such officers of
the SEBI as may be authorized by it, can inspect the books of
accounts and other books and papers of a company kept under
section209 of the Act, These books are normally kept at the
registered office of the company but the Board of directors may
decided to keep all books of account or any of them at a place other
than the registered office provided the Registrar is informed in
electronic Form No. 23AA of the Companies (Central Governments’ )
General Rules and Forms, 1956 within seven days of its decision.

Sub-section (6) of Section 209 provides that the following
persons shall be responsible for keeping the nooks of accounts and
securing compliance by the company with the requirement of the
Act:
a) Where the company has a managing director or manager, such
managing director or manager and all officers and other
employees of the company; and



b) Where the company has neither a managing director nor a
manager, every director of the company.

Where a company has a branch office then the nooks of
account can be kept at such branch also, but properly summarized
returns made up to date, at intervals of not more than three
months, have to be sent by the branch office to the company at
registered office or to other place where books of accounts of the
company as mentioned above are maintained. The purpose of this
provision is that entire picture of the accounts of the company be
available at one place for those who are inspecting the books of
account.

The books of account together with vouchers, records and
papers relevant to any entry in the books, should be preserved for a
period of not less than 8 years immediately preceding the current
accounting year.

The penalty for the contravention of this section is
imprisonment up to 6 months or fine up to Rs. 10000/- or both to
the persons responsible for the default as indicated in Sub-section
(6) of Section 209 of the Act.

(13) Cost Record:
As would be seen from sub-Para (d) above under the head
“books of account” a company is required to keep such particulars



regarding utilization of material, labor or other items of cost as may
be prescribed by the Central Government. The Central Government
so far has prescribed the maintenance of such records in some
notified industries like cycles, refrigerators, caustic soda, vanaspati,
bulk drugs, cotton textiles, milk food, fertilizers etc. For this
purpose, separate rules have been framed for each such industry.
The cost records kept under sub-section (1) (d) of Section 209 are
governed by the same provision relating to maintenance,
preservation, inspection and penalty etc. as are applicable to books
of account.

(14) Register of Particulars of Contracts in which Directors are
interested (Section 301):
Every company must maintain the register to record the
following particulars;
a) The date of the contract or arrangement in which directors
are interested ;

b) The names of the parties to such contracts or arrangements;

c) The principal terms and conditions thereof;

d) The date when the contract of this type was placed before the
Board of directors; and

e) The names of the directors voting for or against the contract or
arrangement and the names of those remaining neutral.



Entries relating to contract or arrangement must be made
within seven days from the date on which the contradict or
arrangement is approved by the Boards wherever applicable or in
respect of other contract within 30 days of the date of the contract.

The previous approval of the Central Government is necessary
in case of a company having paid-up share capital or Rupees one
core or more, entering into contracts in which directors are
concerned or interested as per the proviso to Section 297 (1).

This is the only register which requires to be signed by all the
directors present at the Board meeting following the meeting in
which the contract and copies can be taken in the same manner by
the members of the company as in the case or register of members.
If default is made in the maintenance of this register, the company
and every officer in default shall be liable for a fine up to Rs. 5000/-
each and for refusal of inspection etc., fine up to Rs. 500/- per day
of default.

secretary of company or by any other person authorized by the

kept in the custody of the secretary of the company or by any other



(15) Register of Directors, etc.:
As per Section 303 of the Companies Act, 1956, every
company must keep at its registered office, a Register of Directors,
Managing Director, Manager and Secretary. The necessary
particulars regarding name, surname, in the case of a women, her
husband’s name, nationality occupation, usual residential address,
managerial position in other companies and date of birth in the
case of public company, must be entered in the register. Besides,
the names and particulars of directors nominated have also to be
included in the register. Every company, is required to send
electronically a return giving the particulars contained in the
register to the Registrar. Any changes in the managerial prone
should also be intimated to the Registrar. The time allowed for
filling the returns is 30 days and so is for notification of a change in
the managerial personnel. The register can be inspected by
members free of change, and buy outsiders on payment of a fee of
Re. 1. However, there is no provision for supplying of copies or
extracts from this register. Apart from this, the registrar is also
required to keep a register for entering particulars received in
respect of directors. The register is also open to inspection on
payment of prescribed fee. With the launch or MCA-21 project,
users shall have facility for public inspection through electronic
means.




If default is made in the maintenance of this register, the
company and every officer in default shall be liable for a fine up to
Rs 500/- for every day during which the default continues.

(16) Register of Directors Shareholdings:
This register is to be maintained according to Section 307.
Every company shall keep a register showing, in respect or each
director of the company, the number, description and amount of
any shares in, or debentures of the company or any other body
corporate, being the company’s subsidiary or holding company, or a
subsidiary of the company’s holding company, which are held by
him or in trust for him, or of which he has any right to become the
holder whether on payment of not [Section 307 (1)].

The purpose of maintenance of this register must be
understood. The directors of the company during the course of their
duties come to know about the present and the future policy of the
company and the way in which it is going and it intends to go. In
order to prevent any misuse of the position resulting in any



dishonest financial gain by dealing in the shares of the company,
and of its subsidiaries, it is prescribed that all transactions relating
to the Directors shareholding must be reported to the company and
the same must be entered in the register.

The register containing these particulars must be kept open
for inspection by members and debenture holders for a period of 17
clear days – 14 days before the annual general meeting and 3 days
after it (Saturdays and Sundays should be disregarded for the
purpose of counting this period ). The register will always be open to
inspection by the Registrar or any person authorized by the Central
government. Further, the Registrar or the Central Government can
call for a copy of this register or any part thereof. However,
members have not been given any such right of getting copies or
this register or extracts thereof.

The most important part of the legal requirements in
connection with this register is that the nature and extent of any
interest or right in or over any shares or debentures recorded in
respect of a director in the said register shall, if he so requires, be
indicated in the register. These provisions are applicable to a
manager as they apply to directors.




person authorized by the Board of the purpose.

(17) Register of Investment, Loan Made, guarantee given or
Security Provided to Other Body Corporate:
The Companies (Amendment) Act, 1999 has inserted section
372A in the companies Act, 1956. As per Sub-section (5) of Section
372A of the Companies Act, 1956, every company shall keep a
register showing the following particulars in respect of every
investment made in the securities of other bodies corporate, all the
loans given to other bodies corporate, guarantees given and security
provided in connection with loans made by other persons to, or to
any other persons by, the company:
 The name of the body corporate ;

 The amount, terms and purpose of the investment

or loan or security or guarantee;

 The date on which the investment or loan has been made;
and

 The date on which the guarantee has been given or security
has been provided in connection with a loan.



The particulars above shall be entered in the register in
chronological order within seven days.

The register shall be kept at the registered office of the
company and shall be open to inspection at such officer and
extracts may be taken there from and copies thereof may be
required by any member of the company in the same manner as in
the case of register of members.
If default is made in the maintenance of this register, the
company and every officer of the company who is in default shall be
punishable with fine which may extend to five thousand rupees and
also with a further fine which may extend to rupees five hundred for
every day during which the default continues.

secretary or the company or by any other person authorized by the


(18) Register of Renewed and Duplicate Certificates:
 The name(s) of the person(s) to whom the certificates were
issued.



 The numbers and date of issue of the share certificate in
lieu of which the new certificates have been issued.

 The number and date of the new share certificate and the
number of shares it covers.

The register should be maintained at the registered office of
the company. The register is not open for inspection.
All entries in this register are required to be authenticated by
the secretary or any other person authorized by the Board of
directors.


(19) Register of records and documents destroyed [Section 163
and the companies (Preservation and disposal of Records)
Rules, 1966]:
As per rule 4 of the Companies (Preservation and disposal of
Records) Rules, 1966, a company shall maintain a register or
records and documents destroyed, which should indicate the
following;
a) Particulars of documents destroyed

b) Date and mode of destruction with the initials of secretary or
other authorized person.



The register is not open for inspection.
All entries made in the register shall be authenticated by the
secretary or such other person as may be authorized by the Board
for the purpose. Contravention of any of these rules shall be
punishable with fine which may extend to five hundred rupees.

(20) Register of sweat equity shares [Section 79A and the
Unlisted Companies (Issue of Sweat Equity Shares) Rules,
2003]:
The company shall maintain a register of sweat equity shares
issued under section 79A in the form specified in Rule 5 of the
Unlisted Companies (Issue of sweat Equity Shares) Rules, 2003 in
which there shall be entered the following particulars:
a) Serial number

b) Folio number or certificate number

c) Date of passing of resolution

d) Date of issue of sweat equity shares

e) Name of the allotted

f) Status of the allottee - whether director or employee

g) Reference to entry in register or members



h) Number of sweat equity shares issued

i) Face value of the shares

j) Price at which shares issued

k) Total consideration paid by employee / director

l) Lock in period till which date

The register should be open for inspection during the business
hours of the company, subject to such reasonable restrictions as
the company may impose by its articles or in general meeting so
that not less than 2 hours in each working day of the company are
allowed for inspection.

Members can inspect the register without payment of any free.

Board for the purpose, by appending his signature to reach entry.

The register should be preserved for a period of 8 years from
the financial year in which the latest entry is made and should be



NON-STATUTORY BOOKS:
With a view to keeping proper records, companies invariability
maintain certain other addition to statutory books. Without these
books, the efficiency of the company may be adversely affected an
secretary and secretary’s work hampered.

Here theoretical explanation about optional books, which are
maintained by Miven Machine Tools Ltd., mentioned. They are:
1. Register of Transfer.

2. Register of Directors attendance book.

3. Register of attendance of shareholders.

4.

1. Register of Transfer :

According to companies Act, 1956, every transfer or
transmission lodged with the company must be processed and the



relevant share certificates duly endorsed must be sent to the
transferee within 2 months. However, those companies whose
securities are listed on one or more recognized stock exchanges, are
required to complete this process within 30 days of the lodgment of
the transfer deed.

Every time share transfer or transmission are received in the
office of the company or in the office of the share transfer agent or
Registrar of companies, their details are entered in this register and
on specific intervals, this is placed before the board or a committee
of the board looking after the share transfer or transmission work,
which is pursued along with the share transfer or transmission of
the share is approved by the or the committee or the Agent or
Company Secretary if authorized by the BOD, the register is
initiated by chairman of the meeting and the last page or the
register is signed with date by the chairman of the Board or
Committee or the person authorized in this regard. Usual columns
in this register are:
 Serial number of share transfer or transmission.

 Date of registration of transfer.

 Date of Board Meeting at which the transfer was passed.

 Name and address of transferor.

 The amount paid on each shares, if shares are partly paid.

 The number of shares transferred with distinctive numbers.



 The name, address and description of transferee.

2. Register of Directors attendance book:

A company must possess proof of evidence of the fact that a
particular board meeting, the directors who were present, absent
and who had sought leave of absence from the because of their
inability to attend a meeting.

If a t any stage, the board declares vacant the office of anyone
of its directors, the company must have a proper record or
attendance of its directors at each board meeting to establish the
particular director had in fact absented, without leave of the board,
from all the meeting for the specified period of time. In compliance
with the provisions of Sub-Sec. (4) of Sec. 193 of the Companies
Act, the minutes of each board meeting contain the names of all the
directors present at the meeting. In fact minutes of each board
meeting commence with the caption “Directors present at the
meeting”.

In a view of the above provisions, a practice has been
established with companies to keep a directors attendance book, in
which attendance of each directors is marked by writing his name
below details of the meeting. Signature of all the directors attending
board meeting are obtained by the Company Secretary before the
commencement of the meeting.



3. Register of attendance of shareholders :

For keeping proper records of the members attending every
general meeting of company, a register referred to as “Register of
attendance of shareholders” is maintained.

Secretarial staff present at the venue of each general meeting
of a company takes the signature of the members or proxies coming
for attending the meeting before they enter the meeting hall.

The register has the following details:

 Name of the shareholder Folio No. of shareholder.

PENALTIES IMPOSED ON STATUTORY BOOKS

Sec. 49 – Investment of Company not to Be Held in its own Name:
If default is made in complying with any of the requirements of sub-sections
(1) to (8), the company, and every officer of the company who is in default, shall
be punishable with fine which may extend to Rs. 50,000/-.

Sec. 58A – Register of Fixed Deposit:
The company shall be punishable with fine which shall not be less than
twice the amount in relation to which the repayment of the deposit has not been
made, and out of the fine, if released, an amount equal to the amount in relation to



which the repayment of deposit has not been made, shall paid by the Court, trying
the offence, to the person to whom repayment of the deposit was to be made, and
on such repayment, the liability of the company to make payment of the deposit
shall, to the extent of the amount paid by the Court, stand discharged;

Every officer of the company who is in default shall be punishable with
imprisonment for a term which may extend to five years and shall be liable to fine.

The Company Shall Be Punishable:
a) Where such contravention relates to the acceptance of any deposit, with fine
which shall not be less than an amount equal to the amount of the deposit so
accepted ;
b) Where such contravention relates to the invitation of any deposit, with fine
which may extend to one lakh rupees but shall not be less than five thousand
rupees;
Every officer of the company who is in default shall be punishable with
imprisonment for a term which may extend to five years and shall also be liable to
fine of Rs. 500/- and further fine of Rs. 50/- per day if default is continues.

Sec. 77A - Register of Securities Bought Back:
If a company acts in contravention of sub-section (1) to (3), the company,
and every officer of the company who is in default, shall be punishable with fine
which may extend to Rs. 50,000/- or with imprisonment which may extend to two
years, or with both.

Sec. 143 – Register of Charges:



If any officer of the company knowingly omits, or willfully authorizes or
permits the omission of, any entry required to be made in pursuance of sun-section
(1), he shall be punishable with fine which may extend to Rs. 500/-.

Sec. 150 – Register of Members:
If default is made in complying with sub-section (1), the company, and
every officer of the company who is in default, shall be punishable with fine which
may extend to Rs. 500/- for every day during which the default continues.

Sec. 151 – Index of Members:
If default is made in complying with sun-section (1) or (2) or (3), the
company, the every officer of the company who is in default, shall be punishable
with fine which may extend to Rs. 500/-.

Sec. 152 – Register and Index of Debenture Holders:
If default is made in complying with sub-section (1) or (2), the company,
and every officer of the company who is in default, shall be punishable with fine
which may extend to Rs. 50/-.

Sec. 157 – Foreign Register of Members or Debenture Holders:
If default is made in complying with the requirements of sun-section (2), the
company, and every officer of the company who is in default, shall be punishable
with fine which may extend to Rs. 50/- for every day during which the default
continues.



Sec. 163 – Register and Returns:
The company, and every officer of the company who is in default, shall be
punishable, in respect of each offence, with fine which may extend to Rs. 50/- for
every day during which the refusal or default continues.

Sec. 193 – Minutes Books:
If default is made in complying with the foregoing provisions of this section
in respect of any meeting, the company, and every officer of the company who is
in default, shall be punishable with fine which may extend to Rs. 50/-.

Sec.209– Books of Account:
If any of the persons referred to sun-section (6) fails to take all reasonable
steps to secure compliance by the company with the requirements of this section,
or has by his own willful act been the cause of any default by the company
hereunder he shall, in respect of each offence, be punishable with imprisonment for
a term which may extends to 6 months or with fine which may extend to
Rs. 10,000/-, or with both.

Provided that in any proceedings against a person in respect of an offence
under this section consisting of failure to take reasonable step to secure compliance
by the company with the requirements of this section, it shall be defence prove that
the competent and reliable person was charged with the duty of seeing that those
requirements were complied with and was in a position to discharge that duties.

Provide further that no person shall be sentenced to imprisonment for any
such offence unless it was committed willfully.



If any person, not being a person referred to in sun-section (6), having been
charged by the managing Director, Manager or Board of Directors, as the case may
be, with the duty of seeing in doing so, he shall, in respect of each offence, be
punishable with imprisonment for a term which may extends to 6 months or with
fine which may extend to Rs. 10,000/-, or with both.

Sec. 301 – Register of Particulars of Contract in Which Directors are
Interested:
If default is made in complying with the requirements of sun-section (1), (2)
or (3), the company, and every officer of the company who is in defaults, shall be
punishable with fine which may extend to Rs. 5,000/- and for refusal of inspection
etc., fine up to Rs. 500/- per day of default.

Sec. 303 – Register of Directors:
The company, and every officer of the company who is in default, shall be
punishable, in respect of each offence, with fine which may extend to Rs. 500/- for
every day during which the refusal or default continues.

Sec. 307 – Register of Directors shareholdings:
If default is made in complying with the sun-section the company, and every
officer of the company who is in default, shall be punishable with fine which may
extend to Rs. 500/-.



If default is made in complying with the sub-section (1), (2), or if any
inspection required under this section is refused, or if any copy required there
under is not sent within a reasonable time, the company, and every officer of the
company who is in default, shall be punishable with fine which may extend to five
thousand rupees and also with further fine which may extend to five hundred
rupees for every day during which the default continues.

Sec. 374 – Penalty for Contravention of Section 372 or 373:
If default is made in complying with the provision of section 372 [excluding
sub-section (6) and (7) or section 373, every officer of the company who is in
default, shall be punishable with fine which may extend to Rs. 5000/-.

PENALTIES / FINES FOR NON- COMPLIANCE
Statutory Books /
Sl. No. Default / Penalty
Registers
1. U/S 49, Register of If default is made in complying with
investments not held in any of the provisions of sub-section
company’s name. (1) to (8) of sec. 49. The Company



and every officer of the company
who is in default, shall be punishable
with fine which may extend to Rs.
50,000/-

2. U/S 58A, Register of Rs. 500 and also further fine
Fixed deposits extending up to Rs. 50 for every
successive day of default.

3. U/S 77A, Register of If company fails to maintain this
Securities bought back. register then the company and every
officer of the company who is in
default shall be punishable with fine
which may extend up to Rs. 50,000
or with imprisonment for a term
which may extend up to 2 years or
both.

4. U/S 143, Register of Every office of the company who
Charges knowingly omits or willfully
authorizes of permits omission of the
entries required to be made in the
register in punishable of the
provision of sub-section (1) of
Sec.143 shall be punishable with
may extend to Rs. 500
If inspection is refused the company



and every office of the company who
is in default shall be punishable with
fine which may extend to Rs. 50 and
with further fine which may extend
to Rs.20 for every day during which
refusal continues and that the
company law board may by order
compel immediate inspection of
Register of Charges.

5. U/S 150, 151 Register of Default in compliance with the
Members provisions of sun-section (1) of Sec.
150 attracts penalty which may
extend to Rs. 500/- for Every day
during which the default continues.

6. U/S 152, Register of Default in compliance with the
Debenture Holders. provisions of Sub-section (1) of 152
attracts penalty which may extend to
Rs.50/- for every day during the
which default continues.

7. U/S 157, Foreign Register If default is made in complying with
of Members and the requirements of sub-section (2) to
Debenture Holders. the company and every officer of the
company who is in default, shall be
punishable with fine which may



extend to Rs. 50/- for every day
during which the default continues.

8. U/S 163, Register and The company and every officer of
Returns. the company, who is in default, shall
be punishable in respect of each
offence with fine which may extend
to Rs. 50/- for every day during
which the default continues.

9. U/S 193, Minute Book Any default in compliance with the
provisions of Sec.193 attracts penalty
extending up to Rs. 50.
Sec. 196 (3) provides, if any
inspection of general meeting
minutes is refused or copy there of
not furnished within specified time,
every responsible officer of the
company shall be punishable with
fine which may extend up to Rs. 500
in respect of each offence.

10. U/S 209 (1) Books of The penalty for contravention of this
Accounts section is imprisonment up to 6
months and fine up to Rs. 10,000/- or
with both to the persons responsible
for the default as indicated in sub-


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