Q.) DOES MGT-9 FORMS A PART OF BOARD’S REPORT?
Biggest confusion facing by our professionals is whether MGT-9 will be part of the Board’s Report or not.
According to Companies Amendment Act, 2017 w.e.f. 31.7.2018 i.e. read with notification dated 31st July, 2018 provision in relation to MGT-9 has been removed from Section 134 and a new provision added i.e. “the web address, if any
In section 134, sub section 3, clause (a), for the words:-
“the extract of the annual return as provided under sub-section (3) of section 92;”
The following Clause shall be substituted, namely-
“the web address, if any, where annual return referred to in sub-section (3) of section 92 has been placed.
But section 92 contradicts this provision!
Section 92 deals with Annual Return and states:
(3) Every company shall place a copy of the annual return on the website of the company, if any, and the web-link of such annual return shall be disclosed in the Board’s report.]
or sub-section (3),
An extract of the annual return in such form as may be prescribed shall form part of the Board’s report
12 Extract of Annual Return
(1) The extract of the annual return to be attached with the Board’s Report shall be in Form No. MGT.9.
(2) A copy of the annual return shall be filed with the Registrar with such fee as may be specified for the purpose.
RULE OF INTERPRETATION:
If we apply the Rule of Harmonized Construction we find “When there is an enactment between two provisions which cannot be reconciled with each other , they should be so interpreted , that if possible , the effect should be given to both.”
It is a settled Rule that an interpretation which results in hardship, injustice or anomaly should be avoided and that which conforms to justice should be adopted.
Conclusion:
If we read both the section simultaneously, we find section 134 says only web link is necessary but if we read alongwith section 92 it clearly states that MGT-9 is mandatory.
Therefore, it’s better to keep extract of Annual Report, i.e. MGT-9 as a part of Board’s Report.
Disclaimer: The article is based on the relevant provisions and as per the information existing at the time of the preparation. In no event I shall be liable for any Direct and Indirect Result from this Article. This is only A Knowledge Sharing Initiative.
THE AUTHOR – CS DEEPTI GUPTA (ASSOCIATE PARTNER-HELPINGHANDS PROFESSIONALS LLP) AND CAN BE REACHED AT CSDEEPTI28@GMAIL.COM OR 9910248911.
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