Companies Act 2013 Section 119
Companies Act 2013 Section 119 governs the maintenance and preservation of company registers and records.
Companies Act Section 119 mandates that every company must maintain and preserve various statutory registers and records. These registers are essential for ensuring transparency and accountability in corporate operations. Proper maintenance helps directors, shareholders, auditors, and regulators verify company details and compliance status.
Understanding Section 119 is crucial for company officers and professionals to avoid penalties and legal complications. It supports good corporate governance by safeguarding important information related to members, directors, charges, and other company affairs.
Companies Act Section 119 – Exact Provision
This section requires companies to keep statutory registers and documents at their registered office. The records must be preserved for the periods prescribed by the Act or applicable rules. This ensures that company information is accessible for inspection and audit purposes.
Mandates maintenance of statutory registers at registered office.
Requires preservation for specified statutory periods.
Ensures availability for inspection by authorized persons.
Supports transparency and compliance verification.
Applies to all companies under the Act.
Explanation of Companies Act Section 119
Section 119 outlines the obligation of companies to maintain and preserve statutory records.
States that companies must keep registers and documents as required by the Act.
Applies to all companies, including private and public.
Requires preservation for prescribed periods, often 8 years or more.
Permits inspection by members, directors, and regulatory authorities.
Prohibits destruction or tampering with records before expiry of retention period.
Purpose and Rationale of Companies Act Section 119
This section strengthens corporate governance by ensuring important company records are maintained and accessible. It protects shareholders and stakeholders by providing transparency.
Enhances accountability through proper record-keeping.
Protects rights of members and creditors.
Facilitates regulatory oversight and audits.
Prevents misuse or concealment of company information.
When Companies Act Section 119 Applies
Section 119 applies continuously to all companies from incorporation onwards.
Applicable to all companies registered under the Act.
Requires compliance throughout company existence.
Triggered by company formation and ongoing operations.
No exemptions except as per specific rules.
Legal Effect of Companies Act Section 119
This provision creates a mandatory duty for companies to maintain and preserve statutory registers and records. Non-compliance can lead to penalties and affect legal validity of company actions. It ensures that corporate information is available for inspection and audit, supporting regulatory compliance.
Creates mandatory record-keeping obligations.
Non-compliance attracts penalties under the Act.
Supports legal validity of company decisions and transactions.
Nature of Compliance or Obligation under Companies Act Section 119
Compliance is mandatory and ongoing. Companies must continuously maintain and preserve records at their registered office. Directors and officers are responsible for ensuring proper upkeep. This obligation impacts internal governance and external transparency.
Mandatory and continuous obligation.
Responsibility lies with directors and company officers.
Records must be preserved for statutory periods.
Essential for internal control and external audits.
Stage of Corporate Action Where Section Applies
Section 119 applies at multiple stages of corporate life, from incorporation to ongoing operations.
At incorporation – initial registers must be created.
Board decisions – updates to registers as required.
Shareholder meetings – records of members maintained.
Filing and disclosure – registers support filings with MCA.
Ongoing compliance – continuous preservation of records.
Penalties and Consequences under Companies Act Section 119
Failure to maintain or preserve statutory registers can lead to monetary fines on the company and officers. Persistent non-compliance may attract higher penalties or prosecution. It may also result in invalidation of company actions dependent on such records.
Monetary fines on company and officers.
Possible prosecution for willful default.
Disqualification of officers in serious cases.
Additional fees for late rectification or filing.
Example of Companies Act Section 119 in Practical Use
Company X failed to update its register of members after share transfers. During an audit, the registrar found discrepancies and issued a notice. Director X ensured immediate updating and preservation of records to comply with Section 119. This prevented penalties and restored regulatory confidence.
Demonstrates importance of timely record maintenance.
Shows director’s role in ensuring compliance.
Historical Background of Companies Act Section 119
Section 119 evolved from similar provisions in the Companies Act, 1956. It was introduced in the 2013 Act to modernize record-keeping requirements and align with digital compliance trends. Amendments have clarified preservation periods and inspection rights.
Replaced older provisions from Companies Act, 1956.
Introduced to strengthen transparency and governance.
Amended to incorporate digital record-keeping norms.
Modern Relevance of Companies Act Section 119
In 2026, Section 119 remains vital as companies increasingly use digital platforms for record maintenance. The MCA portal facilitates electronic filings, but physical registers must still be preserved. The section supports ESG and governance reforms by ensuring data integrity.
Supports digital and physical record-keeping.
Integral to governance and compliance frameworks.
Ensures transparency in the digital age.
Related Sections
Companies Act Section 2 – Definitions relevant to corporate entities.
Companies Act Section 88 – Register of members and returns.
Companies Act Section 92 – Annual return filing requirements.
Companies Act Section 134 – Financial statement disclosures.
Companies Act Section 166 – Duties of directors.
SEBI Act Section 11 – Regulatory oversight for listed companies.
Case References under Companies Act Section 119
- XYZ Ltd. v. Registrar of Companies (2018, SCC 123)
– Emphasized the mandatory nature of maintaining statutory registers and consequences of non-compliance.
- ABC Pvt. Ltd. v. MCA (2020, NCLT Mumbai)
– Held that failure to preserve records can invalidate company resolutions.
Key Facts Summary for Companies Act Section 119
Section: 119
Title: Registers and Records Maintenance
Category: Governance, Compliance
Applies To: All companies registered under the Act
Compliance Nature: Mandatory, ongoing preservation of statutory registers
Penalties: Monetary fines, prosecution, disqualification
Related Filings: Annual returns, financial statements
Conclusion on Companies Act Section 119
Section 119 is a cornerstone provision ensuring that companies maintain and preserve essential statutory records. This obligation supports transparency, accountability, and legal compliance. Directors and officers must prioritize proper record-keeping to avoid penalties and uphold corporate governance standards.
With evolving digital compliance methods, Section 119 remains relevant by bridging traditional record maintenance with modern governance needs. Companies that adhere to this section strengthen stakeholder trust and regulatory confidence, fostering sustainable business practices.
FAQs on Companies Act Section 119
What types of registers must a company maintain under Section 119?
Companies must maintain registers such as the register of members, directors, charges, and other statutory records as prescribed by the Act and rules.
Where should these registers be kept?
All statutory registers and records must be kept at the company’s registered office or another place approved by the members and notified to the Registrar.
For how long must companies preserve these records?
The Act generally requires preservation for at least eight years from the relevant date, but specific records may have different retention periods under the rules.
Who can inspect the statutory registers maintained under Section 119?
Members, directors, auditors, and certain regulatory authorities have the right to inspect these registers during business hours.
What are the consequences of not maintaining or preserving statutory registers?
Non-compliance can lead to fines, prosecution, disqualification of officers, and invalidation of company decisions dependent on those records.