Companies Act 2013 Event-Based Compliance: Complete Guide & Document Automation for Company Secretaries

The Companies Act, 2013 (including 2023 amendments) governs corporate events from director appointments to strike-off. Each event triggers specific statutory requirements—board resolutions, EGM notices, explanatory statements, and ROC filings. Understanding these provisions and automating document drafting helps Company Secretaries deliver compliant work faster. This guide covers all major event-based provisions, manual vs automated workflows, and how document automation software streamlines each one.

Manual vs Automated Document Drafting: A Comparison

Company Secretaries traditionally draft event-based documents manually—copying from templates, updating company names and dates, and cross-checking section references. This approach is time-consuming and error-prone. Document automation software changes the workflow entirely.

Software Automation Process: How It Works

Event-based document automation follows a structured process. Understanding this helps Company Secretaries integrate software into their practice effectively.

1. Select company and event type – Choose the client company from the master database and the event (e.g., director change, ESOP, RPT). The software loads company details (CIN, registered office, directors) automatically.
2. Enter event-specific data – Fill in only the data unique to the event (e.g., appointee name, transaction value, grantee list). Excel import is available for bulk data (grantees, shareholders).
3. AI-assisted fields (optional) – For complex disclosures (eligibility criteria, appraisal process, lapse conditions), use AI Generate to draft compliant text based on Rule 12(2) or Section 102.
4. Generate documents – Select the documents needed (board notice, resolution, EGM notice, explanatory statement, etc.). The software produces Word documents with correct formatting and section references.
5. Review and save – Review generated documents, make minor edits if needed, and save to the document library. Download as .docx for client delivery or MCA filing.

1. Director Appointment & Resignation (Sections 152, 161, 168)

Provisions: Section 152 governs director appointment; Section 161 allows board to fill casual vacancies; Section 168 covers resignation. Director consent (Section 152(5)) and DIR-12 filing are mandatory.

• Board resolution for appointment/acceptance of resignation
• Director consent letter (appointment)
• Resignation letter from director
• Form DIR-12 within 30 days

Automation: Director appointment and resignation software generates board notices, resolutions, consent letters, and resignation letters. Pre-filled company data ensures consistency and reduces errors.

2. KMP Appointment (Section 203)

Provisions: Section 203 mandates appointment of Key Managerial Personnel (KMP)—Managing Director, CEO, CFO, Company Secretary—for specified companies. Board resolution and shareholder approval (where applicable) are required.

• Board resolution and notice
• EGM/AGM notice if shareholder approval needed
• Appointment letter and consent
• DIR-12 for director-designate KMP

Automation: KMP appointment modules generate board notices, resolutions, and appointment letters. AI-assisted drafting can tailor terms to role and company profile.

3. Change in Share Capital (Section 61)

Provisions: Section 61 requires special resolution for alteration of share capital. Form SH-7 and MGT-14 are mandatory. Right issue (Section 62(1)(a)), bonus (Section 63), and private placement (Section 42) have distinct requirements.

• Special resolution (EGM) for authorised capital increase
• Explanatory statement (Section 102)
• Form SH-7, MGT-14, PAS-3 (allotment)

Automation: Share capital change software drafts resolutions, notices, and supports SH-7, PAS-3. Private placement software handles Section 42 compliance with PAS-4, PAS-5, and EGM documents.

4. Change in Registered Office (Sections 12(4), 12(5))

Provisions: Section 12(4) allows board resolution for change within same city; Section 12(5) requires special resolution for change outside city limits. Form INC-22 is mandatory.

• Board resolution (within city) or special resolution (outside city)
• EGM notice and explanatory statement (if outside city)
• Form INC-22 within 30 days

Automation: Address change resolution software generates board/partner resolutions, notices, and INC-22 support for companies and LLPs.

5. Alteration of Object Clause / MOA (Section 13)

Provisions: Section 13 mandates special resolution for alteration of memorandum. EGM, explanatory statement (Section 102), and Form INC-28 are required.

• Board notice to approve proposal and convene EGM
• EGM notice, special resolution, explanatory statement
• Form INC-28, MGT-14

Automation: Object clause change software drafts resolutions with correct MOA wording, explanatory statements, and form support.

6. Share Transfer (Section 56)

Provisions: Section 56 governs transfer of securities. Board approval is required; refusal must be justified (Section 58). Form SH-4 (instrument of transfer) and updating registers are mandatory.

• Board resolution approving transfer
• Share transfer form (SH-4)
• Board notice and minutes

Automation: Share transfer software generates board resolutions, SH-4 forms, and integrates with statutory registers.

7. Related Party Transactions – RPT (Section 188)

Provisions: Section 188 mandates board approval for RPTs. Transactions exceeding prescribed thresholds require prior shareholder approval; related parties cannot vote. Board report must disclose RPTs with justification. Rule 15 prescribes procedural requirements.

• Board resolution (interested directors recused)
• EGM notice and ordinary resolution (if shareholder approval required)
• Explanatory statement (Section 102)
• Board report disclosure (Section 134(3)(h))

Automation: RPT compliance modules generate board notices, resolutions, EGM notices, explanatory statements, and board report disclosure text—all with proper recusal and disclosure language.

8. Inter-Corporate Loans & Investments (Section 186)

Provisions: Section 186 governs loans, guarantees, and investments. Board approval is mandatory; limits (60% of paid-up capital + free reserves + securities premium, or 100% of free reserves + securities premium) require special resolution. Prior approval of lenders may be needed.

• Board resolution (unanimous where specified)
• EGM notice and special resolution (if limits exceeded)
• Explanatory statement

Automation: Inter-corporate loan modules draft board notices, resolutions, EGM documents, and explanatory statements with correct limit disclosures.

9. ESOP – Employee Stock Option Plan (Section 62(1)(b), Rule 12)

Provisions: Section 62(1)(b) allows issue of shares to employees under ESOP. Rule 12 of Companies (Share Capital and Debentures) Rules, 2014 prescribes eligibility, vesting, exercise price, and disclosures. Special resolution (or ordinary for private companies) and Rule 12(2) explanatory statement are mandatory.

• Board resolution approving scheme and convening EGM
• EGM notice, special/ordinary resolution
• Explanatory statement with all Rule 12(2) disclosures
• Scheme document, MGT-14, SH-6 (option register)

Automation: ESOP compliance software generates board notices, resolutions, EGM notices, explanatory statements (with AI-assisted eligibility, appraisal, lapse conditions), scheme documents, and checklists. Supports both direct and trust routes.

10. Company Name Change (Section 13(2))

Provisions: Section 13(2) requires special resolution for change of name. EGM, explanatory statement, and Form INC-28 are mandatory. Central Government approval may be required in certain cases.

• Board notice, EGM notice, special resolution
• Explanatory statement
• Form INC-28, MGT-14

Automation: Company name change modules draft resolutions and notices with company profile–aware wording (OPC, private, public).

11. Dividend Declaration (Section 123)

Provisions: Section 123 governs declaration of dividend. Interim dividend is declared by board; final dividend requires ordinary resolution at AGM. Transfer to reserves, record date, and payment timelines apply.

• Board resolution (interim) or AGM ordinary resolution (final)
• Board/AGM notice, attendance, minutes

Automation: Dividend declaration software generates board/AGM notices, resolutions, and payment-related documents.

12. CSR – Corporate Social Responsibility (Section 135)

Provisions: Section 135 and Companies (CSR) Rules require eligible companies to spend 2% on CSR. CSR Committee, policy, and annual action plan are mandated. The Companies (Accounts) Second Amendment Rules, 2023 introduced event-based CSR-2 filing requirements.

• Board resolution on CSR policy and expenditure
• Annual action plan, committee constitution
• Board report disclosure

Automation: CSR modules generate policy, annual action plans, board resolutions, and board report disclosure text.

13. Conversion to LLP & Strike-Off

Provisions: Conversion to LLP is governed by Companies (Incorporation) Rules. Strike-off (voluntary) is under Section 248; Form STK-2, board resolution, and indemnity are required.

• Board resolution, shareholder resolution
• STK-2, affidavits, indemnity (strike-off)

Automation: Strike-off software and conversion modules generate resolutions and forms. LLP compliance software supports post-conversion LLP documents.

2023 Amendments: What Changed

The Ministry of Corporate Affairs notified several amendments in 2023. The Companies (Management and Administration) Second Amendment Rules, 2023 introduced the concept of a "designated person" for Significant Beneficial Owner reporting. The Companies (Accounts) Second Amendment Rules, 2023 clarified event-based compliance, including CSR-2 filing timelines. Companies (Prospectus and Allotment of Securities) Second Amendment Rules, 2023 enhanced transparency in securities. Document automation software that stays updated with these changes helps CS professionals avoid non-compliance.

How CoSecAI Automates Event-Based Documents

CoSecAI provides an Event-Based Suite covering all the events above. The automation process includes:

• Pre-built templates – Aligned with Companies Act 2013, MCA formats, and Secretarial Standards (SS-1, SS-2)
• AI-assisted drafting – For eligibility criteria, appraisal process, lapse conditions, valuation method, explanatory statements, and custom documents
• Company and director data – Auto-filled from master database (CIN, registered office, directors, shareholders)
• Excel import – Bulk import for ESOP grantees, shareholders, directors (one-click parse)
• Document library – Save, categorise, and track all generated documents by company and event
• Letterhead integration – Generated Word documents include company letterhead when configured
• Multi-provider AI – Choose DeepSeek, OpenAI, or Gemini for AI-generated content

Step-by-Step Automation Workflow

• Select company from dropdown → Company details load automatically
• Choose event tab (Director Change, KMP, Share Capital, RPT, ESOP, etc.)
• Fill event-specific form fields (dates, amounts, names, transaction details)
• Use AI Generate for complex text (eligibility, appraisal, lapse, custom instructions)
• Select documents to generate → Click Generate → Download .docx
• Save to document library with agenda description for future reference

Conclusion

Event-based compliance under the Companies Act, 2013 (and 2023 amendments) requires precise documents for each corporate event. Company Secretaries who automate drafting with event-based document software reduce errors, meet deadlines, and scale their practice. CoSecAI covers all major events with compliant templates, AI assistance, and integrated workflows—helping you deliver faster without compromising on compliance.