Form MGT-14 for Private Companies: Which Resolutions Must Be Filed and Which Need Not#
"Are private companies exempt from filing MGT-14?" is one of the most common questions founders and company secretaries ask. The accurate answer is: partly. This article sets out what section 117 of the Companies Act, 2013 requires, which part of it a private company has been relieved from, and the condition attached to that relief.
What Form MGT-14 Is and Why It Exists#
Section 117(1) of the Companies Act, 2013 says a copy of every resolution or agreement on the matters listed in section 117(3), together with the explanatory statement under section 102 (if any) annexed to the notice of the meeting, must be filed with the Registrar of Companies within thirty days of its passing or making, "in such manner and with such fees as may be prescribed".
Rule 24 of the Companies (Management and Administration) Rules, 2014 supplies the manner: the copy is filed with the Registrar in Form MGT-14 along with the fee. The purpose is public record. Certain decisions change the company's constitution, control or management, and the register at the ROC should show them.
The Rule: Section 117(3) Lists the Categories#
Section 117 does not say "file every resolution". It applies to the categories in sub-section (3):
- (a) Special resolutions. For example, altering the articles (section 14) or the memorandum (section 13) requires a special resolution.
- (b) Unanimous resolutions agreed to by all members which would otherwise have needed to be passed as special resolutions.
- (c) Managing director resolutions and agreements: any Board resolution, or agreement executed by the company, relating to the appointment, re-appointment or renewal, or variation of the terms of appointment, of a managing director.
- (d) Class resolutions and agreements that needed a specified majority or particular manner, and those that bind a class of members though not agreed to by all of them.
- (f) Voluntary winding-up resolutions passed under section 59 of the Insolvency and Bankruptcy Code, 2016.
- (g) Resolutions passed under section 179(3), the Board powers exercisable only by resolution at a Board meeting: calls on shares, buy-back, issue of securities, borrowing, investment, loans, guarantees and security, approval of financial statements and the Board's report, diversification, amalgamation, merger or reconstruction, takeover, and any other prescribed matter.
- (h) Any other resolution or agreement as may be prescribed and placed in the public domain.
Clause (e) has been omitted. Section 117(1) also has a proviso: a resolution that alters the articles, and every agreement referred to in sub-section (3), must be embodied in or annexed to every copy of the articles issued afterwards.
The Private-Company Position#
The relief for private companies is narrow, and it is often described more broadly than it is.
What is exempt. By notification G.S.R. 464(E) dated 5 June 2015, issued under section 462, the Central Government directed that clause (g) of section 117(3) shall not apply to private companies. In practice, a private company does not file, under section 117, the Board resolutions passed under section 179(3), such as the resolution to borrow or to make an investment.
What is not exempt. The notification does not touch the other clauses. A private company still has to consider special resolutions (clause (a)), unanimous resolutions in lieu of special resolutions (clause (b)), managing director resolutions and agreements (clause (c)), class matters (clause (d)) and voluntary winding-up (clause (f)).
The condition. Notification G.S.R. 583(E) dated 13 June 2017 amended the 2015 notification by adding a clause providing that its exceptions, modifications and adaptations apply to a private company "which has not committed a default in filing its financial statements under section 137 ... or annual return under section 92". A private company that is behind on its annual filings should therefore not assume the section 179(3) relief is available. How the default is tested (for instance, as on which date) is a point to confirm from the notification text and current practice before relying on it.
A related point on share issues. Rule 14(2)(a) of the Companies (Prospectus and Allotment of Securities) Rules, 2014, as originally notified, provides that a private placement must be previously approved by shareholders by a special resolution for each offer. A special resolution is within clause (a), so it is filed even though the Board resolution recommending the issue is a section 179(3) matter. See our article on private placement under section 42 for the wider process. Rules are amended from time to time, so check the current text.
Who Signs and Certifies#
Form MGT-14 is filed electronically on the MCA portal. The form itself and the MCA instruction kit specify who must sign it, whether a professional's certificate is required, and which attachments go with it. We have not reproduced those requirements here because the current form should be read directly. Plan for digital signature certificates of the signatories well before the deadline, and confirm on the form who must sign and whether certification is called for.
Timelines and Penalty for Late Filing#
The time limit is thirty days from the date the resolution is passed or the agreement is made (section 117(1)).
Section 117(2), as substituted with effect from 21 December 2020, provides for default:
- Company: Rs. 10,000, plus Rs. 100 for each day after the first during which the failure continues, subject to a maximum of Rs. 2 lakh.
- Every officer in default: Rs. 10,000, plus Rs. 100 per day after the first, subject to a maximum of Rs. 50,000.
Separately, the ROC fee rules may prescribe the filing fee and an additional fee for delayed event-based filings. The amounts depend on the fee schedule in force, so check the current Companies (Registration Offices and Fees) Rules and the fee shown on the portal.
Do I Need to File? A Practical Walk-Through#
Ask these questions in order for each decision:
- Was it passed as a special resolution (or agreed unanimously in place of one)? If yes, it falls in clause (a) or (b). File.
- Is it a Board resolution or agreement on a managing director's appointment, re-appointment, renewal or terms? If yes, clause (c). File.
- Is it a class matter, or a voluntary winding-up resolution? Clauses (d) and (f). File.
- Is it a section 179(3) Board resolution only, and is the company a private company with no default in financial statements or annual return? Then clause (g) does not apply under the 2015 notification. If the company is in default, treat the exemption as unavailable and seek advice.
- Is any other resolution or agreement prescribed and placed in the public domain (clause (h))? Check the current rules.
Three illustrative examples#
These are illustrations of the reasoning, not advice on any real company.
Example 1: Changing the articles. A private company's shareholders pass a special resolution to amend its articles. This is a special resolution, so clause (a) applies and the copy, with the explanatory statement, is filed in MGT-14 within thirty days. The altered articles must also carry the resolution, as the proviso to section 117(1) requires.
Example 2: A board resolution to make an investment. A private company's Board resolves to invest surplus funds, a power listed in section 179(3)(e). The company is current on its financial statements and annual returns. No shareholder special resolution is involved. Clause (g) is disapplied by the 2015 notification, so no MGT-14 is filed for that Board resolution. If the same company were in default on its annual filings, the position needs fresh analysis, because the exemption is conditional.
Example 3: Appointing a managing director. A private company's Board appoints a managing director on stated terms and the company enters an agreement with the appointee. Clause (c) covers Board resolutions and agreements relating to the appointment. The 2015 notification only disapplies clause (g), so this one is filed. If shareholder approval by special resolution is also taken, that special resolution is a separate item under clause (a).
Common Mistakes to Watch For#
These are reasoned from the text, not statistics.
- Treating "private company exempt" as a blanket rule. The exemption is for one clause only.
- Ignoring the default condition. A company with pending annual filings may find the relief unavailable.
- Missing the special resolution behind a Board decision. A Board resolution may be exempt while the shareholder resolution that authorises the same transaction is not.
- Counting the thirty days from the wrong date. The period runs from the passing of the resolution or making of the agreement, not from a later date such as signing of the minutes.
- Forgetting the annexure. The explanatory statement under section 102 goes with the resolution.
Where to Read the Official Text#
- Companies Act, 2013, sections 117, 179 and 462, on India Code (indiacode.nic.in).
- Companies (Management and Administration) Rules, 2014, rule 24, and the MGT-14 form and instruction kit on the MCA website (mca.gov.in).
- MCA notifications G.S.R. 464(E) dated 5 June 2015 and G.S.R. 583(E) dated 13 June 2017 in the Gazette of India.
- The current Companies (Registration Offices and Fees) Rules for fees. Forms and fee rules have been amended in recent years, so confirm you are reading the latest version.
Speak to a Professional Before Filing#
Whether a particular resolution needs MGT-14 turns on how it was passed, what it authorises, and the company's filing history. Companies should have a Chartered Accountant or Company Secretary review the resolution and the company's compliance status before deciding not to file.