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CS Professional · Compliance Management, Audit and Due Diligence · Secretarial Audit

Mehta Textiles Ltd's company secretary, Ritu, reviews the quarter's filings and tells the Board that a return required under a labour law applicable to the company was filed late. Which function under Section 205 is she performing?

Ritu is reporting to the Board about compliance with the Act, the rules and other laws applicable to the company. This is a core function under Section 205(1)(a), and it covers other applicable laws such as labour legislation, not just the Companies Act.

  1. AReporting to the Board about compliance with the Act, the rules and other laws applicable to the companyCorrect
  2. BIssuing the secretarial audit report to be annexed to the Board's report
  3. CConducting the internal audit of the company's functions and activities
  4. DReplacing the Board's duty to ensure legal compliance by the company

Explanation

Section 205(1)(a) makes it a function of the company secretary to report to the Board about compliance with the Act, the rules and other laws applicable to the company. A labour law is an 'other law applicable', so the report falls within this function. The secretarial audit report is given by a company secretary in practice under Section 204, not under Section 205.

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