Liabilities of Company Secretary (Statutory and Contractual Liabilities)

There are many liabilities of company secretary. Company Act 1994, Income Tax Act 1922, and the stamp act define the liabilities of a company secretary. His liabilities can be divided into two groups, which are:

  • Statutory Liabilities,
  • Contractual Liabilities.

Liabilities of Company Secretary

Liabilities of Company Secretary
Liabilities of Company Secretary

Statutory liabilities

A company secretary is legally bound to the following liabilities:

1. Register all files and documents of the company.

2. Arrange a statutory meeting and prepare the statutory report and submit it to the Registrar of the joint-stock company in due time.

3. Arrange an annual general meeting in due time.

4. Sending notice of the meeting to the participant.

5. Writing minutes of various meetings and maintaining minute books.

6. Supplying a relevant copy of minutes to the shareholders.

7. Directors, shareholders, and debenture holder’s registrar maintaining.

8. Submitting/financial statements of the Company to the Registrar of Joint Stock Company.

9. Issuing share certificates, dividend warrants, and bonus share certificates to the shareholders.

10. Deduct income tax from the employee salary and pay a dividend to the shareholders.

11. Appointing company auditor and arranging an audit of books of account of the company.

12. Never enter into any contract or distribute any share and debenture until the board of directors authorizes it. Also never take any loan in the name of the company.

13. Submitting income tax returns and ensuring the use of the required company seal and stamp.

Contractual liabilities

Such liabilities arise from his service contract made with the company. Which are given below:

1. Abide by all terms and conditions of the service contract.

2. Follow the order instructions and act as per the authorization of the board of directors.

3. Maintain secrecy of the company affairs.

4. Perform duties with due care and skills.

5. Never act beyond his authority and do not make any secret profit through any illegal activity.

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