| Section | EXEMPTIONS APPLICABLE TO PRIVATE LIMITED COMPANIES |
| Section 2 - Related party | Provision of section 2 (76) (vii) i.e. Holding, subsidiary or an associate company or a subsidiary of holding company to which it is also a subsidiary (fellow subsidiary) will not be considered as related party for the purpose of section 188. [Section 2(76)(viii)] |
| Section 3 - Formation of company. | Only two persons are required to forma Private Company. [Section 3(1)b] |
| A private company other than a company registered under section 8 of the Act having paid up share capital of Rs 50 lakhs or less or average annual turnover during the relevant period is Rs 2 crore or less may convert itself into one person company by passing a special resolution in the general meeting. [Section 3 read with rule no 7 of the Companies (Incorporation) Rules, 2014] |
| Section 39- Allotment of securities by company | Requirement related to minimum subscription and minimum application money is not application |
| Section 43 -Kinds of share capital | Provisions of sec 43 shall not apply where memorandum or articles of association of a Private Company so provides. |
| Section 47- Voting rights | Provisions of sec 47 shall not apply where memorandum or articles of association of a Private Company so provides |
| Section 54- Issue of sweat equity shares | Not required to comply SEBI guidelines for issue of sweat equity shares |
| Section 62- Further issue of share capital | A private company is not required to comply with the provision with respect to minimum time period to open an offer and dispatch of offer notice through registered post or speed post or through electronic mode if 90%, of the members of a private company have given their consent in writing or in electronic mode. [Section 62 (1) (a) (i) & 2] |
| Section 62 -Further issue of share capital | A private Company can offer shares to employees under a scheme of employees' stock option by passing ordinary resolution instead of a special resolution.[Section 62 (1) (b)] |
| Section 67 - Restrictions on purchase by company or giving of loans by it for purchase of its shares. | Provisions of sec 67 shall not be applicable to Private Companies :- in whose share capital no other body corporate has invested any money;
- if the borrowings of such a company from banks or financial institutions or any body corporate is less than twice its paid up share capital or fifty crore rupees whichever is lower; and
- such a company is not in default in repayment of such borrowings subsisting at the time of making transactions under this section.
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| Section 68- Power of company to purchase its own securities | Not required to comply SEBI guidelines for issue of sweat equity shares ,file declaration of solvency and return of buy-back with SEBI |
| Section 73 -Prohibition on acceptance of deposits from public | The provisions relating to acceptance of deposits shall not apply to a private company which accepts deposits from its members monies not exceeding 100%, of aggregate of the paid up share capital and free reserves, and such company shall file the details of monies so accepted to the Registrar in such manner as may be specified [Section 73(2) (a) to (e)] |
| Section 93- Return to be filed with the Registrar in case promoter's stake changes | Not required to file return of changes in shareholding of promoter and top ten shareholders with the Registrar |
| Section 101- Notice of meeting | Shall apply unless otherwise specified in section or the Articles of the company provide otherwise |
| Section 102- Statement to be annexed to notice | Shall apply unless otherwise specified in section or the Articles of the company provide otherwise |
| Section 103- Quorum for meetings | Shall apply unless otherwise specified in section or the Articles of the company provide otherwise |
| Section 104- Chairman of meetings | Shall apply unless otherwise specified in section or the Articles of the company provide otherwise |
| Section 105- Proxies | Shall apply unless otherwise specified in section or the Articles of the company provide otherwise |
| Section 106- Restriction on voting rights | Shall apply unless otherwise specified in section or the Articles of the company provide otherwise |
| Section 107- Voting by show of hands | Shall apply unless otherwise specified in section or the Articles of the company provide otherwise |
| Section 108- Voting through electronic means | Not required to provide facility to members to exercise their right to vote at general meeting by electronic means. [Section 108 read with rule 20(1) of the Companies (Management and Administration) Rules, 2014] |
| Section 109 - Demand for poll | Shall apply unless otherwise specified in section or the Articles of the company provide otherwise |
| Section 110- Postal ballot | Not required to pass mandatory business by way of postal ballot. [Section 110 read with Rule 22(16) of the Companies (Management and Administration) Rules, 2014] |
| Section 117 - Resolutions and agreements to be filed | Board resolution passed u/s 179 (3) are not required to be filed with Registrar in MGT-14 [Section 117 (3) (g)] |
| Section 120- Maintenance and Inspection of documents in electronic form | Not required to maintain records in electronic format [Section 120 read with Rule no 27 (1) of the Companies (Management and Administration) Rules 2014] |
| Section 121- Report on annual general meeting | Not required to file report on annual general meeting with Registrar |
| Section 134- Financial Statement, Board's report, etc | - Private company is not required to state in its boards' report the manner in which formal annual evaluation has been made by the Board of its own performance and that of its committees and individual directors.
- Not required to disclose in the directors responsibility statement , any statement regarding internal control
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| Section 136- Right of member to copies of audited financial statement | Not required to place its financial statement including the consolidated financial statement along with all other documents required to be attached or annexed to, on its website, if any. |
| Section 149- Company to have Board of directors. | Not required to have woman director on its Board. [Section 149 read with rule 3ofThe Companies (Appointment and Qualification of Directors) Rules, 2014] |
| Not required to appoint independent director on its board. [Section 149 read with rule 4ofThe Companies (Appointment and Qualification of Directors) Rules, 2014] |
| Required to have only two minimum directors. |
| Section 152- Appointment of directors | No requirement of retirement by rotation of directors at Annual General Meeting. |
| Section 160 - Right of persons other than retiring directors to stand for directorship | Shall not apply |
| Section 161- Appointment of additional director, alternate director and nominee director | Not required to fill casual vacancy in meeting of its Board. |
| Section 162-Appointment of directors to be voted individually | Shall not apply |
| Section 164- Disqualifications for appointment of director. | Can provide for additional grounds for disqualification of a director in its articles of association. |
| Section 167- Vacation of office of director | Can provide for additional grounds for vacation of office of a director in its articles of association .[Section 167(4)] |
| Section 177- Audit committee | Not required to constitute audit committee. [Section 177 read with rule 6 of the Companies (Meeting of Board and its powers) Rules, 2014] |
| Section 178- Nomination and remuneration committee and stakeholder's relationship committee. | Not required to constitute Nomination and remuneration committee. [Section 178 read with rule7 of the Companies (Meeting of Board and its powers) Rules, 2014] |
| Section 180- Restrictions on powers of Board | The Board of Directors can exercise the powers prescribed u/s 180 without passing a special resolution. |
| Section 184- Disclosure of interest by director | The Directors may participate at the meeting of the Board in which the contract or arrangement is discussed after disclosure of his interest. [Section 184 (2)] |
| Section 185 - Loan to Directors | Shall not apply to a private company -- in whose share capital no other body corporate has invested any money;
- if the borrowings of such a company from banks or financial institutions or any body corporate is less than twice of its paid up share capital or fifty crore rupees, whichever is lower; and
- such a company has no default in repayment of such borrowings subsisting at the time of making transactions under this section
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| Section 188 - Related party transactions | - Shall not be required to obtain the approval of shareholders by way of special resolution in case the transactions with the related party exceed the prescribed limits [Section 188 (1) first proviso]
- Related party can vote on the resolution in the shareholders meeting.
[Section 188 (1) second proviso]
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| Section 190- Contract of employment with managing or whole-time directors | The provisions of this section shall not apply to a private company. |
| Section 196 - Appointment of managing director whole-time director or manager | Compliance of Schedule V along with approval of shareholders& Central Government is not required for appointment of managing director, manager and whole time director and no returns needs to be filed with Registrar for this purpose. [Section 196 (4) & (5)] |
| Section 197- Overall maximum managerial remuneration and managerial remuneration in case of absence or inadequacy of profits | - The limit prescribed for remuneration with respect to directors shall not apply to a private company
- No approval of Central Government is required in case of increase in the remuneration of directors, managing director, whole-time director or manager whether at appointment, re-appointment or at any other time.
- Not required to disclose in the Board reports the details relating to remuneration
[Section 197 read with Rule no 5(1) of the Companies (Appointment and payment of managerial remuneration) 2014] |
| Section 203- Appointment of key managerial personnel | Not required to appoint key managerial personnel except Company Secretary. [Section 203 read with rule 8 & 8A of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014] |
| Section 204- Secretarial Audit for bigger companies | Not required to get a secretarial audit conducted. [Section 204 read with rule 9 of the Companies (Appointment and Remuneration of Managerial Persons) |
