Pammy Jaiswal

As informed by MCA on 1st July, 2019, deployment of e-form BEN-2 goes live today, i.e. 2nd July, 2019. This e-form was much awaited as now the technical and operational flexibilities will be surfaced while filling it up.

The e-form along with the help kit is now available. The contents of the e-form is summarized below with some technical features.

  • For declaring the holding reporting entity
    • Once this is field is selected, no other information is required, except for the CIN of the holding company and mandatory attachment BEN-1
  • For declaring SBOs by the reporting entity
    • Number of SBOs to be mentioned basis which the rows in the table on SBOs will be reflected (Max 9)
    • a system generated SBO ID shall be generated and shared for each SBO (it seems that the SBO ID will be sent via email on the registered email id reflected for the reporting entity) – SBO ID is mandatorily required to be mentioned in case of change in significant beneficial ownership. Further, while submitting declaration, in case the SBO ID has already been generated and is available with the company, the same is required to be mentioned. 
    • Mention the number of members through whom indirect holding or right in reporting company is being exercised by the SBO
    • Max no. of members that can be entered has to be less than10
    • Once the number is entered in the table, the e-form will accordingly ask the complete details of the SBO through such members divided into 5 parts (A to E)
  • Details of members and SBOs
    • Part A –requires the details of the member of the reporting entity through which the SBO has significant beneficial interest
      • Manner of having beneficial interest
      • Type of member -drop down options include
        • Company
        • FCRN
        • Any other body corporate
        • LLP
        • HUF
        • Partnership Firm
        • Discretionary Trust
        • Charitable Trust
        • Specific Trust
        • Revocable Trust
        • Pooled Investment Vehicle (PIV)
        • Entity controlled by PIV
      • All the details shall be pre-filled in case of Company, FCRN or LLP.
      • In all other cases, all these details have to be manually entered.
      • Date of entry in register of members
  • Part B – mention the status of SBO , choose from drop down options which includes
    • Individual
    • Partner
    • Karta
    • Trustee
    • Beneficiary
    • Settlor
    • General Partner
    • Investment Manager
    • CEO of Pooled Investment Vehicle
  • Herein case of trust, the following may be noted:
Type of TrustStatus of SBOInactive fields
Discretionary TrustTrusteePart C and D becomes inactive
Charitable TrustTrusteePart C and D becomes inactive
Specific TrustBeneficiaryPart C and D becomes inactive
  • Part C- Where the status of SBO is individual then mention whether the SBO has majority stake in the
    • Member of the Reporting Company, or
    • Ultimate Holding Company of the member of the reporting company
  • This part becomes inactive where the member type and status of SBO selected is either of the following
    • HUF and Karta
    • Partnership Firm and Partners
    • Trust and Trustees or Settlor
    • PIV and General Managers or investment managers or CEO of PIV
  • Part D – Details of individual SBO
    • This part becomes inactive where the member type and status of SBO selected is either of the following
      • Any other body corporate and individual
      • HUF and Karta
      • Trust and Trustees or Settlor
      • PIV and General Managers or investment managers or CEO of PIV
  • Part E – Particulars of the Significant Beneficial Owner
    • SBO ID to be entered and then details shall be prefilled
    • PAN
    • Passport Number
    • Enter the date of acquiring Significant Beneficial Interest by the SBO.
    • Enter the date of declaring the Significant Beneficial Interest in form BEN-1
    • Enter the date of receipt of Form BEN-1 from the SBO by the company
    • Enter details of direct holding, if any.

Practical difficulties or technical glitches

  • What should be the cut-off date for determining the extent of holding by the SBO?

While the SBO rules issued on 8th Feb, 2019 is very clear that the SBO is required to declare his beneficial interest within 90 days of the commencement of the SBO Rules i.e. within 11th May, 2019. This implies that companies must have received BEN-1 within the said time, however, the reporting of the same is being made in the month of July, 2019, i.e. after a gap of almost two months at the

There may even be a situation that BEN-1 has been received in the month of February, 2019 itself and there has been a change in the holding of SBO. In the event of such change, the following situations may crop up:

  • The erstwhile SBO ceases to be the SBO
  • The erstwhile SBO remains the same however the percentage changes; or
  • There is a new SBO altogether

In each of the above situations, BEN-1 will be given again and BEN-2 to be filed now should report the situations accordingly. In fact in doing so, companies may end up filing two BEN-2 itself.

  • Field A (a) in the e-form seems to have an apparent error– the drop down options for type of member includes ‘Foreign Company Registration Number’ instead of ‘Foreign Company’.
  • The date of entry in the register of members under section 88 – should be the date of first entry made or when the SBO acquired the interest in such member of the reporting entity.
  • In case a reporting entity has more than 9 SBOs then, there are two options available:
    1. File a different e-form altogether, or
    2. Provide the details in the same format and attach under optional attachment.
  • Similarly in case the SBO is holding through more than 9 entities, then also the same options may be applied.
  • In case type of member selected is either Partnership or HUF or Trust, then the details of such member has to be manually entered by the reporting entity. In doing so, the form mandatorily asks for registration number of these entities also, which may or may not be there.
  • Declaration of SBO and change in SBO cannot be filed in the same e-form.
  • In situations where the SBO is determined on the basis of control, the following is significant to note:
    1. Copy of the agreement is not mandatory since the e-form is successfully checked at the level of check form without the agreement attachment.
    2. Under the details of member through which the SBO is holding, filed C requires to put whether the individual (SBO) has the majority stake in the member of the reporting entity or ultimate holding company. Please note that in case of control, both these fields may not be relevant, however, the reporting entity will have to select either of the fields and give a clarificatory note in this regard.


While we have discussed few of the technical glitches and issues, there may remain several other issues which may crop up on case to case basis. The test will now be for all the reporting entities who have received BEN-1 to try and fit the details received in BEN-2.