MCA Notice for Section 92 Annual Return Default: How to Respond

By LegalInk Editorial ·

MCA Notice for Section 92 Annual Return Default: How to Respond

A notice from the Registrar of Companies for annual return non-filing is issued under Section 92 of the Companies Act, 2013, which requires every company to file its annual return within sixty days of the conclusion of each annual general meeting. To respond: file the overdue return first, then submit a reply to the Adjudicating Officer that contests the penalty computation where possible and evidences remediation. The default is curable, but the window matters and the reply must be structured correctly.

What Section 92 of the Companies Act, 2013 Requires

Section 92 of the Companies Act, 2013 requires every company to prepare an annual return with particulars as on the close of the financial year. The return covers the registered office, principal business activities, holding and subsidiary companies, share capital, debentures, indebtedness, members, directors, key managerial personnel, meetings, and director remuneration.

Form MGT-7 and MGT-7A

The annual return is filed in Form MGT-7 for companies other than One Person Companies and small companies. OPCs and small companies file Form MGT-7A, which carries a condensed disclosure set.

The due date is sixty days from the conclusion of the AGM. For companies with a 31 March financial year-end, this typically falls around 29 November, given the AGM deadline of 30 September.

Who Signs the Return

Where a company is required to have a whole-time company secretary, the annual return must be signed by both a director and the company secretary. Where none is appointed, it may be signed by a practising company secretary, whose certification is separately required under Section 92 of the Companies Act, 2013 for listed companies and public companies crossing prescribed paid-up capital or turnover thresholds.

Penalty Structure for Section 92 Annual Return Default

The penalty for non-filing under Section 92 of the Companies Act, 2013 operates on a continuing basis. Where a company fails to file the annual return before the deadline, the company is liable to a penalty of fifty thousand rupees, plus one hundred rupees for every day of continuing default.

The same provision makes every officer in default — in practice the managing director, the whole-time director responsible for compliance, and the company secretary — personally liable for fifty thousand rupees plus one hundred rupees per day of default, capped at five lakh rupees.

Adjudication vs. Prosecution

Default under Section 92 of the Companies Act, 2013 now sits within the civil penalty regime. The Registrar adjudicates penalties through an Adjudicating Officer rather than launching prosecution before a court. The adjudication order is a speaking order that can be appealed to the Regional Director.

This distinction matters: responding to the Adjudicating Officer notice correctly is the first line of defence, and a poorly drafted reply can foreclose arguments at the appeal stage.

Reading the MCA Notice: What to Check Immediately

When a notice arrives citing default under Section 92 of the Companies Act, 2013, verify four things before drafting any reply.

  • The period of default alleged: Confirm the financial year(s) for which non-filing is alleged and cross-check against your MCA21 filing history.
  • The computation of penalty: The notice carries a provisional penalty figure. Independently compute the per-day rate and the number of days from the due date to either the date of filing (if filed late) or the date of the notice.
  • Whether filing has since been completed: If the return was filed late but before the notice date, attach the SRN and filing acknowledgment as a primary exhibit. This does not extinguish the penalty but limits the period.
  • Whether the officer-in-default designation is accurate: If the notice names a director or company secretary not in office during the default period, raise this at the reply stage with supporting board resolutions and filing records.

How to Reply and Cure the Default

The reply is not a boilerplate document. It must address the factual matrix, contest the penalty computation where applicable, and demonstrate remediation.

Step 1: File the Overdue Return First

If Form MGT-7 or MGT-7A has not been filed, file it immediately — with the applicable additional fee — before submitting your reply. An unremediated default is treated far more seriously than one that has been cured, and the additional fee accrues daily, so delay compounds both the government fee and the adjudication penalty.

Step 2: Draft the Reply on the Correct Grounds

Grounds commonly available include genuine hardship from auditor non-cooperation or financial year transition, board reconstitution that disrupted compliance, or MCA21 portal failures supported by screenshots and helpdesk tickets. Grounds must be factual and documented — unsupported assertions carry little weight before Adjudicating Officers.

Use the LegalInk brief generator to structure the reply with the correct statutory references, exhibit list, and prayer clause.

Step 3: Consider Compounding

Where the penalty quantum is significant and the default is admitted, compounding under Section 441 of the Companies Act, 2013 is available. It is applied for before the Adjudicating Officer or Regional Director depending on the penalty amount and extinguishes further prosecution risk. Assess it before the adjudication order is passed, because post-order compounding is procedurally more complex.

For ongoing monitoring — AGM timelines, annual return due dates, and officer-in-default tracking — the LegalInk compliance framework can be configured to flag upcoming MCA filing deadlines before defaults arise.

Frequently Asked Questions

Can the penalty for default under Section 92 of the Companies Act, 2013 be waived entirely?

The Companies Act, 2013 does not provide for a blanket waiver. The Adjudicating Officer has discretion to reduce penalties in genuine hardship cases, but complete waiver is not the statutory standard. A well-documented reply demonstrating remediation and a good-faith compliance history is the most effective mitigation.

If Form MGT-7 was filed late but before the MCA notice, does the default still attract penalty?

Yes. Filing after the due date but before the notice does not eliminate the default under Section 92 of the Companies Act, 2013 — it limits the penalty period to the days between the due date and the actual filing date. Include the SRN prominently in the reply to establish the cure date.

Who qualifies as an officer in default for Section 92 of the Companies Act, 2013?

Officers in default typically include the managing director, the whole-time director designated as responsible for compliance, and the company secretary. A director who resigned before the default period began, with resignation and cessation filings on record, can contest inclusion.

Is default under Section 92 of the Companies Act, 2013 a criminal offence?

No. Since the decriminalisation amendments, annual return non-filing under Section 92 of the Companies Act, 2013 is adjudicated as a civil penalty rather than prosecuted as a criminal offence. The focus shifts to the adjudication reply and, if necessary, the appeal to the Regional Director.

The penalty exposure on annual return default under Section 92 of the Companies Act, 2013 is real but manageable with prompt remediation and a structured reply. For companies facing notices across multiple financial years, each year is a separate default, which makes early action on any open year critical. Drafting support and compliance calendaring are available at legalink.co.in.

Statute citations in this article are verified against LegalInk's verified law registry before publication. Always confirm the current text of any provision before relying on it.

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