Register of Directors and KMP: Sections 170 and 171

The register of directors and KMP is the record every company keeps at its registered office of who its directors and key managerial personnel are, and what securities each of them holds. Section 170(1) of the Companies Act, 2013 requires it, section 170(2) requires a matching return to reach the Registrar within thirty days of any appointment or change, and section 171 gives members a right to inspect it and to take copies free of cost.

What must the register of directors and KMP record?

Section 170(1) leaves the general particulars to the rules but writes one item into the Act itself, and it is the item that matters to anyone reading the company from outside. The register shall include the details of securities held by each director and key managerial person in five places:

1. the company itself,
2. its holding company,
3. its subsidiary,
4. a subsidiary of the company's holding company, and
5. its associate companies.

That reach is the point. A director's stake in the company is often visible elsewhere. A director's holding in a sister subsidiary under the same holding company is not, and section 170(1) puts it in a register that members can inspect.

Section 170(2) is the filing limb. A return containing such particulars and documents as may be prescribed must be filed with the Registrar within thirty days from the appointment of every director and key managerial person, and within thirty days of any change taking place. Two separate clocks, both thirty days, and the second one is what converts the register from a snapshot into a maintained series.

What inspection rights does section 171 give?

Two, and they are not the same right.

The first is the members' right in section 171(1)(a). The register is open for inspection during business hours, members may take extracts from it, and copies are to be provided to them, on request, free of cost within thirty days. Free of cost is stated in the Act rather than left to a fee schedule.

The second is broader in who it covers and narrower in when. Under section 171(1)(b) the register is also kept open for inspection at every annual general meeting and made accessible to any person attending the meeting. Not only members. A proxy or an authorised representative attending the meeting is inside those words.

Section 171(2) supplies the remedy. If inspection under clause (a) is refused, or a copy required under that clause is not sent within thirty days of the request being received, the Registrar shall, on an application made to him, order immediate inspection and supply of the copies required.

What is the penalty for a default under sections 170 and 171?

Neither section carries a penalty of its own, so they fall to the residual penalty for Chapter XI. Section 172, as the India Code consolidation prints it, provides that where a company is in default in complying with any provision of the Chapter for which no specific penalty or punishment is provided, the company and every officer in default is liable to a penalty of fifty thousand rupees, and for a continuing failure a further five hundred rupees for each day it continues, subject to a maximum of three lakh rupees for a company and one lakh rupees for an officer in default.

The footnote to that section in the consolidation reads "Subs. by Act 29 of 2020, s. 35, for section 35 (w.e.f. 21-12-2020)". The section substituted is 172, not 35, so the reference is reproduced here as printed rather than corrected, and the amending Act should be checked directly before the citation is relied on.

Where the register of directors and KMP shows up in a filing

The return under section 170(2) is the trace that leaves the company. Every appointment and every change produces a filing at the Registrar within thirty days, which means a change in a board or in the key managerial personnel has a dated record independent of whatever the company announces. For a listed company, that filing sits alongside the exchange announcement of the same change, and the two dates are worth comparing.

The securities limb of section 170(1) is the other half. It records holdings that the disclosure regimes built for promoters and large shareholders do not necessarily surface, particularly holdings inside a group structure. It is a register rather than a public filing, which is exactly why the section 171 inspection right exists.

Where this sits in the disclosure picture

• Appointment of directors under section 152 covers the appointment that starts the thirty-day clock in section 170(2).
• The Director Identification Number covers the identifier that ties a person's entries across companies together.
• The register of contracts under section 189 covers the other director-facing register with a members' inspection right.
• Disclosure of interest by a director covers the section 184 disclosures that feed that register.
• The register of members covers the shareholder-side register kept under a separate inspection regime.

Flock reports the filings themselves, each stamped with its date and linked back to the exchange or regulator that published it. What any of it means for you is your call to make.