MCA Explains When Companies Face Penalties and Strike-Off

In a Lok Sabha reply to Unstarred Question No. 146 answered on 20 July 2026, the Ministry of Corporate Affairs stated that State-wise and year-wise details of companies filing annual returns and financial statements, and those not filing them during the last five years, are provided in Annexure-I. The reply states that enforcement action for non-filing is taken under sections 92(5) and 137(3) of the Companies Act, 2013, while continuous non-compliance for more than two years makes a company liable for strike-off under section 248(1). Annexure-II contains details of regulatory action taken during the last five financial years. To improve compliance, the Ministry sends bulk email and SMS reminders, publishes FAQs on the MCA21 portal and conducts awareness programmes with professional institutes. It further states that MCA administers compliance through the MCA21 e-governance platform and has introduced measures including virtual AGMs and EGMs, reduced compliance requirements for startups, small companies and One Person Companies, an e-adjudication module effective from 16 September 2024 for technology-driven adjudication, and expansion of the fast-track merger framework in February 2021 and September 2025.

GOVERNMENT OF INDIA

MINISTRY OF CORPORATE AFFAIRS
LOK SABHA
UNSTARRED QUESTION NO. 146
ANSWERED ON MONDAY, 20^TH JULY 2026
ASHADHA 29, 1948 (SAKA)
COMPLIANCE OF COMPANIES ACT
QUESTION

146. SHRI RAHUL KASWAN:

WILL THE MINISTER OF CORPORATE AFFAIRS BE PLEASED TO STATE:

a. whether the Government has assessed the status of timely submission of annual returns, financial statements and other statutory records by companies registered under the Companies Act, 2013 during the last five years, if so, the State-wise and year-wise details thereof;

b. the number of non-compliant companies during the said period, the regulatory or punitive action taken against them along with the details of measures adopted to ensure compliance; and

c. whether the Government is developing a new mechanism to make the corporate compliance system simpler, more transparent and time-bound and if so, the details thereof?

ANSWER

MINISTER OF STATE IN THE MINISTRY OF CORPORATE AFFAIRS; MINISTER OF STATE IN THE MINISTRY OF ROAD TRANSPORT AND HIGHWAYS

(SHRI HARSH MALHOTRA)

(a) and (b) The State-wise and year-wise details of companies which

have filed the annual returns and financial statements and the number of companies which did not file the annual returns and financial statements as required under the Companies Act, 2013 during the last five years is at Annexure-I.

Appropriate enforcement action is taken under section 92(5), section 137(3) of the Companies Act, 2013 for non-filing of Annual Returns and Financial Statements respectively. In addition, continuous non­compliance for more than two years makes a company liable for striking-off under section 248(1) of the Companies Act, 2013. The action taken in the last five years is given at Annexure-II. Further, to ensure that companies are compliant in statutory filings the following steps are taken:-

• Bulk emails and SMS are sent to all eligible companies as reminders.
• Specific FAQs are uploaded on the MCA 21 Portal to facilitate filing.
• Various awareness programs are organised in collaboration with professional institutes for professionals and companies.

(c) MCA administers the compliance framework under the Companies Act, 2013, through its e-Governance platform, MCA21, which facilitates statutory e-filings by companies and LLPs. Further, the Ministry has undertaken several steps to simplify corporate compliance requirements, promoting ease of doing business, bringing in transparency. These steps include:-

1. Allowing companies to conduct Annual General Meetings (AGMs) and Extraordinary General Meetings (EGMs) through Video Conferencing (VC) or Other Audio-Visual Means (OAVM), especially post-pandemic.

2. Reduced Compliance for Startups, Small companies and One Person Companies such as:-

• • Abridged annual return prescribed for small companies.
  • Zero fee is charged for incorporation of all companies with authorized capital up to Rs. 15 lakh or with up to 20 members for companies limited by guarantee.

• • Small companies are entitled for lesser penalties as per section 446B of Companies Act, 2013.

3. The Adjudication Mechanism is being implemented through a E- adjudication Module with effect from 16th September, 2024. It is a technology driven adjudication mechanism, for speedy and transparent adjudication of cases pertaining to offence(s) committed under the Companies Act, 2013. This platform provides for end-to-end digital process including online generation of notices, hearings, generation of adjudication orders and payments. This enhances transparency and enables speedier adjudication.

4. The scope of fast-track merger was expanded in February 2021 to allow mergers of Start-ups with other Start-ups and with Small companies. The ambit has been further broadened in September 2025 to allow more classes of companies to choose this route. The rules have also been amended so that the deemed approval requirement is implemented more effectively for fast track mergers.

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Annexure-I

In reply to part (a) and (b) of Parliament Question No. 146 for 20.07.2026.

2020-21

2021-22

2022-23

2023-24

2024-25

Annexure-II

In reply to part (b) of Parliament Question No. 146 for 20.07.2026.

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