What is form MGT-7 and why is it important for companies?
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Every company in India — whether a Private Limited Company, Public Limited Company, or a One Person Company (OPC) — must file its annual return using e-Form MGT-7 with the Registrar of Companies (ROC). After completing each financial year, companies must also organize an Annual General Meeting (AGM) and submit the annual return to the Ministry of Corporate Affairs (MCA).
Form MGT-7 captures important details such as the company’s shareholding structure, list of directors, information about shareholders, and records of debenture holders, all as per the position on the last day of the financial year.
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Why Filing MGT-7 is Important?
- Mandatory Requirement
Every company registered under the Companies Act, 2013, must file its annual return each financial year using Form MGT-7 or MGT-7A. This return must be submitted to the Registrar of Companies (ROC) within 60 days after the Annual General Meeting (AGM). - Penalty for Late Filing
If a company fails to file the form on time, it will attract a penalty of ₹100 for each day of delay, with no maximum limit. - Risk of Strike Off
If a company skips filing annual returns for two consecutive financial years, it risks being marked as an “inactive company” by the authorities. - Disqualification of Directors
Not filing annual returns for three straight years can disqualify the company’s directors. Once disqualified, they cannot be appointed as directors in any company for the next five years. Their Director Identification Number (DIN) will also be deactivated. - Heavy Fines and Imprisonment
If the delay exceeds 270 days from the due date, directors may face a fine starting from ₹50,000 and going up to ₹5 lakh. In serious cases, imprisonment for up to six months can also be imposed, and sometimes both a fine and imprisonment are applied together.
Types of MGT Forms
Form MGT-7
With the Registrar of Companies (ROC) Form MGT-7 is used by most companies to file their annual return. However, it is not used by One Person Companies (OPCs) and Small Companies.
Form MGT-7A
To submit their annual return, Form MGT-7A is specifically designed for one-person companies and Small Companies.
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What is a Small Company?
As per Section 2(85) of the Companies Act, 2013, a Small Company is a private company that meets the following conditions:
- Paid-up share capital does not exceed ₹2 crore (this limit can be increased up to ₹10 crore).
- Annual turnover does not exceed ₹20 crore (this limit can be increased up to ₹100 crore).
Note:
The following are not considered Small Companies: - A holding company or a subsidiary company.
- A company registered under Section 8 (non-profit organizations).
- Any company governed by a special Act.
Benefits of Filing Form MGT-7
- Builds a Positive Company Image
When a company files its annual return on time, its profile on the Ministry of Corporate Affairs (MCA) website gets updated. It shows the date of the last Annual General Meeting (AGM) and the company’s status as “Active.” Anyone checking the company’s profile can see that the business is complying properly, which creates a good impression. - Creates a Public Record
Filing the annual return makes important company information publicly available. Anyone can access these details through the MCA portal under the “Public Record” section, helping build trust and transparency. - Provides Useful Financial Information
The main purpose of financial statements is to give a clear picture of a company’s financial health, performance, and changes over time. This information is valuable for stakeholders like investors, lenders, and business partners to make informed decisions.
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Due Date for Filing Form MGT-7
Every company registered under the Companies Act, 2013 must file its annual return within 60 days after holding its Annual General Meeting (AGM).
Penalty for Late Filing of MGT-7
If a company fails to submit Form MGT-7 on time, it will face a penalty of ₹100 per day for each day of delay until the form is properly filed. Delaying the filing can lead to a heavy financial burden, so it’s important to complete it within the deadline.
Documents Needed for Filing of MGT-7
- List of all shareholders and debenture holders
- List of company directors
- Approval letter for AGM extension (if any extension was granted)
- Any other relevant attachments
Information Required
- Contact Number
- Email Address
- Nature of Business Activity
- Description of Goods or Services Offered
What You Will Receive After Filing?
- Certified copy of Form MGT-7 or MGT-7A
- Preparation of any additional attachments, if needed
- Proper attestation of all required forms
- Detailed list of company directors
- Detailed list of shareholders
Conclusion
Filing Form MGT-7 is crucial for every company to maintain its active status and avoid penalties. Timely compliance not only protects your business but also builds a strong public image. Whether you need help with business registration in Rajasthan or Income Tax Return Filing, staying compliant ensures smooth operations and long-term success for your company.
Why Choose E Accountax Manager?
At E Accountax Manager, we specialize in making legal compliance simple and hassle-free. We provide expert guidance tailored to your needs. Our experienced team ensures timely filings, personalized support, and complete transparency, helping your business grow without worrying about penalties or legal complications.
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