Secretarial Due Diligence in Delhi | Companies Act & ROC Compliance Review

In a Nutshell: Is the Company Legally What It Says It Is?

Secretarial due diligence checks a company’s corporate record under the Companies Act, 2013 — who legally owns the shares, whether every allotment, appointment and charge was properly approved and filed, and whether the statutory registers and minutes back it up. Startup Advisory runs secretarial DD for acquirers, lenders, joint-venture partners and companies preparing for an IPO or a sale.

Share capital: every allotment and transfer from incorporation, with approvals, filings (PAS-3, SH-4, SH-7) and consideration traced.
ROC filings: annual returns and financial statements, event-based forms, and late or missing filings.
Registers and minutes: register of members (Section 88), charges (Section 85), board and general meeting minutes (Section 118, SS-1/SS-2).
Approvals: related-party transactions (Section 188), loans and investments (Sections 185/186), director appointments and KYC.
FEMA: foreign investment reporting such as FC-GPR and FC-TRS where non-residents hold shares.
Provider: Startup Advisory, CA firm in Saket, New Delhi 110030. Call 9311972982.

Reviewed by CA Neeraj Rohilla, FCA — Chartered Accountant, Startup Advisory, Saket, New Delhi.

Financial Statements Show What a Company Has. The Secretarial Record Shows Who Owns It.

A buyer can agree on price and still find, weeks before closing, that a past allotment was never filed, a share transfer was never recorded in the register, or a loan to a director was given without the required approval. Each of these can delay a deal or need regularisation under the Companies Act. Secretarial due diligence reads the company’s legal history from incorporation to today and tells you what is clean, what is fixable and what needs to be covered in the agreement.

What we review

Constitution: certificate of incorporation, MOA and AOA with all alterations, name and object changes, registered office changes.
Share capital trail: authorised capital increases, every allotment (with board and shareholder approvals, offer letters, PAS-3 and valuation where required), transfers and transmissions, buy-backs, ESOP schemes and grants, and the cap table reconciled to the register of members.
Statutory registers: members, directors and KMP, charges, loans and investments, related-party contracts, and significant beneficial owners (Section 90, BEN-2).
Meetings and minutes: board meetings held as required by Section 173, AGMs, EGMs and postal ballots; minutes complete, signed and consistent with filings.
Annual and event filings: AOC-4, MGT-7/7A, ADT-1, DIR-12, DIR-3 KYC, DPT-3, MSME-1 and others; delays, additional fees and pending defaults.
Charges: creation, modification and satisfaction of charges filed on CHG-1 within the time allowed by Section 77, and reconciled to lenders’ records.
Approvals for specific transactions: related-party transactions under Section 188, loans to directors under Section 185, inter-corporate loans and investments under Section 186.
FEMA compliance: foreign direct investment reporting (FC-GPR, FC-TRS), downstream investment and pricing guidelines where non-residents are involved.
Notices and proceedings: ROC, RD or NCLT notices, compounding or adjudication orders, and director disqualifications.

When you need it

Acquisitions and mergers: alongside financial due diligence, before signing the SPA.
Lending: banks and NBFCs checking authority to borrow, charges and existing restrictions.
Joint ventures and strategic investment: before a partner commits capital or board seats.
IPO and SME IPO readiness: years of corporate record cleaned up before the merchant banker’s review.
Startup fundraising: covered as part of our investor-ready due diligence.

Deliverables

A secretarial due diligence report organised by area, each finding graded by seriousness, the provision involved, the consequence, and the remedy — filing with additional fee, ratification, compounding under Section 441, or a specific indemnity in the transaction documents. Where we act for the company, we can then carry out the remediation.

Related Audit & Assurance Services

Financial Due Diligence →Buy-side and sell-side financial due diligence for acquisitions, mergers, JVs and lenders — quality of earnings, net debt, working capital.

Due Diligence & Investor-Ready Report →Financial, secretarial and tax due diligence for startups preparing a funding round.

Statutory Audit →Annual statutory audit of companies under the Companies Act, 2013 and of LLPs above the audit limits — with CARO 2020 reporting.

Internal Audit →Risk-based internal audit under Section 138 — process reviews, control testing and quarterly reports to the board or audit committee.

See all audit & assurance services

Frequently Asked Questions

Secretarial due diligence is a review of a company’s compliance with corporate law, mainly the Companies Act, 2013 and related rules, along with FEMA where relevant. It checks the share capital history, filings with the Registrar of Companies, statutory registers, minutes, charges and approvals for specific transactions.

A secretarial audit under Section 204 is a periodic statutory requirement for listed companies and certain large companies, reported in Form MR-3 by a company secretary in practice. Secretarial due diligence is a transaction-driven review commissioned by a buyer, lender, investor or the company itself, with a scope set by the deal.

Allotments without proper filings or valuation, share transfers not recorded in the register of members, missing or unsigned minutes, charges not filed or not satisfied on record, loans to related parties without the approvals required by Sections 185, 186 or 188, and pending annual filings.

Many can. Late filings can usually be made with additional fees, some defaults can be compounded under Section 441, and certain actions can be ratified. Some issues are better addressed through indemnities or conditions precedent in the transaction documents. The report sets out the route for each finding.

For a private company with a few years of history and organised records, typically one to three weeks from access to the records. Older companies or those with many allotments and transfers take longer.

It depends on the company’s age, number of corporate actions and whether foreign investment is involved. We scope it and quote a fixed fee before starting. Call 9311972982.

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