The Ministry of corporate affairs (MCA) issued a notification, mandating every company to designate a
person who would be responsible for furnishing information regarding beneficial interest in the shares of
the company to the Registrar of Companies (RoC) or any other authorized officer and accordingly extend
necessary cooperation.
Earlier Provision:
As per the earlier provisions the person who hold the beneficial interest in share of a company have to make a declaration to the company specifying the nature of his interest and then the company has to make note of these in the register and file with registrar.
As per the Companies Act, 2013 Beneficial Interest in a share includes Directly or Indirectly, through any
contract, arrangement or otherwise, the right or entitlement of a person alone or together with any other
person to –
a) Exercise or cause to be exercised any or all of the rights attached to such share: or
b) Receive or participate in any dividend or other distribution in respect of such share.
Deemed Designated Person:
Until a person is not designated as required above, the following persons shall be deemed to have been
designated person:
a) A company Secretary, if there is a requirement of appointment of such company secretary under the
Act: or
b) Every Managing Director or Manager, in case a company secretary has not been appointed; or
c) Every director, if there is no company secretary or Managing Director or Manager.
The provision of deemed designated persons ensures that even in transitional periods or organizational
changes, there is a default responsible individual for maintaining transparency in beneficial interest
disclosures. Every company shall inform the details of the designated person in Annual return.
Change in Designated person:
n case of change in the designated person at any point in time, the company should intimate to RoC in e-form GNL-2 under the Companies (Registration Offices and Fees) Rules, 2014.
| SW Point of View:The new amendment in the rule reflects a proactive move towards enhanced corporate transparency and promoting smoother compliance. The approach of Deemed designated person offers a pragmatic solution by preventing lapses in compliance and maintaining regulatory consistency. |
