Introduction

Companies Act, 2013 requires listed entities to use the PAS-6 filing form as an essential requirement for the dematerialization process of their shares. The requirement to file PAS-6 exists for all listed organizations which maintain physical stock share records. PAS-6 creates part of the government initiative toward electronic share conversion from physical share certificate owners which leads to more secure share operations and simpler transactions with better transparency.

This article explains the PAS-6 filing form by reviewing its objectives and examining the submission process and important regulatory standards for businesses.

What is PAS-6?

PAS-6 is Reconciliation of share capital audit report prescribed under the Securities Exchange Board of India (SEBI) regulations that require unlisted public companies to ensure that their shareholding is converted into dematerialized form. PAS-6 mandates companies to report the number of physical shares and dematerialized shares in their shareholding on a half yearly basis 

The form aims to ensure that companies comply with the dematerialization requirements and helps maintain transparency and accuracy in their share records.

Purpose of PAS-6 Filing

PAS-6 serves multiple objectives to ease the process of turning physical shares into electronic shares.

• PAS-6 form aims to enhance transparency in issuance and management of the securities, reducing risk of fraud and duplication of shares 

• The PAS-6 system promotes the electronic transformation of physical shares which results in easy stock trading operations and smoother share transfers and portfolio management.

• Companies must meet this regulatory mandate because SEBI requires it to remain compliant with dematerialized share procedures.

• It also matches the company’s total issued capital with the capital held in dematerialized form in both NSDL and CDSL depositories
  
  

Who Needs to File PAS-6?

PAS-6 is mandatory for the following types of companies:

• Listed Companies: All listed companies must file PAS-6 to report the status of their shareholding in dematerialized form.

• Unlisted Public Companies: Unlisted public companies that hold physical shares in their records must file PAS-6 as part of the effort to move towards electronic shares.

• Companies with Securities in Both Physical and Demat Form: If a company has securities in both physical and dematerialized forms, it must file Form PAS-6.

• Companies with Shares Dematerialized Under SEBI Regulations: If the company’s shares are dematerialized under SEBI’s regulations, they must reconcile their shareholding as part of this filing.
  
  

Note: Private companies are not required to file PAS-6.

When to File PAS-6?

All organizations under this regulation must file PAS-6 every year. The following timelines apply:

• The quarterly submission requirement of PAS-6 exists for listed companies who must report their physical shares and dematerialized shares numbers through this form on their record date.

• The unlisted group of public companies needs to submit PAS-6 each year to show their combined physical and dematerialized share count.

PAS-6 Filing Process

The process for filing the PAS-6 form involves several key steps. Here’s a breakdown of the procedure:

• Step 1: Prepare Data

Before filing PAS-6, the company must gather and compile data on the following:

1. Total number of shares issued.

2. Number of shares held in physical form.

3. Number of shares in electronic (dematerialized) form.

• Step 2: Log in to MCA Portal

1. Companies need to log in to the Ministry of Corporate Affairs (MCA) portal to file the PAS-6 form. The link to the portal is: MCA Portal.

• Step 3: Access PAS-6 Form

1. Once logged in, the company must navigate to the MCA Services section, then select e-Filing and choose the PAS-6 Form.

• Step 4: Fill in the Details

The form requires the company to provide the following details:

1. Company details (name, CIN, etc.).

2. Number of shares held in physical and electronic format.

3. Dematerialization status of the shares.

• Step 5: Submit the Form

1. Once all the information is filled out, the company must submit the PAS-6 form. After submission, the company will receive an acknowledgment receipt.

• Step 6: Confirmation and Filing

1. A confirmation of successful filing will be sent to the company's registered email address. The company must keep a record of the filing for future reference.

Required Documents for PAS-6 Filing

A company must have following details and documents for PAS-6 filing: 

• Basic Company Information: This includes the company’s name, CIN, registered address, and contact details. It provides essential corporate data to identify the company in the PAS-6 filing.

• Share Capital Details: The document must outline the total issued and paid-up share capital, including the breakdown between dematerialized and physical shares. It ensures accurate reporting of the company’s shareholding structure.

• ISIN Details: The ISIN (International Securities Identification Number) details confirm the status of the company’s securities in dematerialized form. It is required to ensure proper reconciliation with the depository records.

• Reconciliation Certificate: A certificate from a Practicing Company Secretary (PCS) confirming that the company’s share capital records are accurately reconciled. It validates the correctness of the dematerialized and physical share capital.

• Board Resolution: A formal resolution passed by the company’s board authorizing the filing of PAS-6 and appointing the responsible personnel for the submission. It ensures internal approval for the filing process.

• Digital Signature Certificates: The DSC is required to authenticate the filing of PAS-6 electronically. It verifies the identity of the authorized signatory for legal compliance with the filing requirements.

Consequences of Non-Compliance with PAS-6 Filing

Radioactive fillings or non-submission of PAS-6 documentation leads to corporate risks that produce financial penalties and formal legal repercussions.

• Non-compliant companies with PAS-6 filing deadlines must pay fines to the authorities.

• Trading of securities listed on the stock exchange may experience suspension when companies fail to meet PAS-6 requirements or submit inaccurate filings.

• Failure to meet the required reporting obligations consistently results in legal consequences for companies.

Important Considerations for PAS-6 Filing

• Accuracy of Data: Ensure that the number of physical and dematerialized shares reported is accurate and reflects the company’s records.

• Timeliness: File PAS-6 within the prescribed time frame to avoid penalties.

• Dematerialization Process: If there are physical shares in the company, ensure that shareholders are encouraged to dematerialize their shares by opening a demat account.

Conclusion

Businesses that distribute physical shares need to fulfill their mandatory compliance requirement by filing PAS-6 documentation. Through PAS-6 filing companies can improve their shareholding operations while keeping compliant with rules for enhanced transparency. All listed and unlisted public companies need to maintain dematerialization compliance standards otherwise they will face penalties and business disruptions.

Every company handling PAS-6 filings must collect precise data while submitting their paperwork on schedule and keeping adequate documentation to fulfill legal requirements of the Companies Act and SEBI.

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