Companies

MCA clarifies on rules for appointment of company secretaries in private firms

KR Srivats New Delhi | Updated on January 07, 2020 Published on January 07, 2020

Secretarial audit ambit widened with additional criteria

The Corporate Affairs Ministry (MCA) has brought clarity into the appointment of company secretaries by private companies. It has now stipulated that all private companies with a paid-up capital of ₹10 crore or above should have a whole-time company secretary.

The earlier norms on this front was quite ambivalent with no specific rule governing the appointment of company secretaries in private companies, said corporate observers.

Private companies with ₹5 crore or more paid-up capital were covered by inference in a round-about manner, but now the rules provide for direct coverage and with a higher threshold of ₹10 crore or more, they said.

Meanwhile, the MCA has also now made secretarial audit mandatory for every company having outstanding loans or borrowings from banks or public financial institutions of ₹100 crore or more, sources close to the developments said.

It may be recalled that already secretarial audit has been made mandatory for every public company having a paid-up capital of ₹50 crore or more or every public company having a turnover of ₹250 crore or more.

Published on January 07, 2020
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