Compulsory Maintenance of “Register of Members” as per Companies Act, 2013
As per Section 88 of Companies Act, 2013 read with Rules 3, 4, 5, 6, 8 and Rule 28 of the Companies (Management and Administration) Rules, 2014 specifies and binds every company to maintain specified register in the given format and within the prescribed time limit.
As per Section 88 (1), Every Company shall keep and maintain the following registers in such forms and in such manner as may be prescribed, namely:-
(a) Register of members indicating separately for each class of equity and preference shares held by each member residing in or outside India;
(b) Register of debenture holders; and
(c) Register of any other security holders
As per Section 88 (1) (a) read with Rule 3 (1) of The Companies (Management and Administration) Rules 2014, every company Limited by shares shall from the date of its registration, maintain records of its members in Form No – MGT -1
As per Rule 3(2) if Company is not having share capital, then they are not required to maintain records as per Form MGT-1, however they are required to maintain a register which consists of below mentioned details
(a) Name of member, address, E- Mail id, PAN Number or CIN No, Father/ Mother Name, Occupation, Status, Nationality and in case member is a minor, name of Guardian and date of birth of the member, name and address of nominee;
(b) Date of becoming member;
(c) Date of cessation
(d) Amount of guarantee, if any
(e) Any other interest if any and
(f) Instructions, if any, given by member with regard to sending of notices etc.
As per Section 88(1) (b) and (c) read with Rule 4 of The Companies (Management and Administration) Rules 2014 every company which issues or allots debentures or any other security shall maintain their records in Form MGT-2
Rule 5 of The Companies (Management and Administration) Rules 2014, specifies the conditions/ procedure, of how to maintain register as required by Section 88.
As required by Rule 6 of The Companies (Management and Administration) Rules 2014 every register shall include an index of the names entered in the respective registers, however maintenance of Index is not mandatory if number of members are less than 50.
As per Rule 8, the entries in the registers shall be authenticated by the Company Secretary of the Company or by any other person authorized by Board for this purpose and the date of board resolution authorizing the same shall be mentioned.
If the records of companies are maintained in Electronic form then as per Rule 28 of The Companies (Management and Administration) Rules 2014, the Managing Director, Company Secretary or any other director or officer of the company as authorized by Board shall be responsible for the Maintenance and security of Electronic Records.
Consequences of Not Maintenance of Records as per Section 88
If the Company and its authorized person are not maintaining registers as required by law, then the company and every officer of the company who is in default shall be punishable with fine which shall not be less than Rs.50,000/- but which may extend to Rs.3,00,000/- and where the failure is a continuing one, with a further fine which may extend to Rs.1,000/- for Every day, after the first during the failure continues.
This article is for the purpose of information and shall not be treated as a solicitation in any manner and for any other purpose whatsoever. For the benefits of readers a snapshot of Section is produced here, so that maximum information is given to readers within limited words. So it is advised to read particular section again for knowing detailed Provisions. It shall not be used as legal opinion and not be used for rendering any professional advice. This article is written on the basis of author’s personal experience. Adequate attention has been given to avoid any clerical/arithmetical error, however; if it still persists kindly intimate us to avoid such error for the benefits of other readers.
The Author can be reached at mail –firstname.lastname@example.org and Mobile/Whatsapp – 9911303737 / 9716118384