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The Ministry of Corporate Affairs has made a further effort to encourage a greater deal of ‘ease of doing business’, the Ministry of Corporate Affairs has enhanced the timeline regarding the duration of several schemes till the end of the year 2020 in the wake of constant disturbance caused by the corona virus pandemic in certain parts of the country.
Various schemes are introduced by the Union Finance Minister in early 2020 like Companies Fresh Start Scheme 2020 and LLP Settlement Scheme. These are valid from 1st April 2020 to 30 September 2020, has been announced to be extended vide Circular No. 30/2020, 31/2020, 32/2020 and 33/2020 on 28/09/2020 with a view to provide a new opportunity to the existing companies by resolving their defaults with no extra fee payment and regularise their companies.
|Time for conducting EGMs through VC or OAVM extended till 31/12/2020||General Circular No. 33/2020||28/09/2020|
|Relaxation for filing charge related forms extended till 31/12/2020||General Circular No. 32/2020||28/09/2020|
|LLP Settlement Scheme 2020 extended to 31/12/2020||General Circular No. 31/2020||28/09/2020|
|Companies Fresh Start Scheme, 2020 extended till 31/12/2020||General Circular No. 30/2020||28/09/2020|
MCA has also extended the scheme for giving further time for filing forms regarding creation or modification of charges under the Companies Act, 2013 and the time for conducting EGMs through video conference, etc.
Following are the important notifications announced and notified through circulars as following:
- The MCA has extended the duration of several schemes till 31/12/2020 in view of the continued disruption caused due to the Covid-19 pandemic in certain parts of the country and to provide greater “ease of doing business”.
- Companies Fresh Start Scheme, 2020 has now been extended till 31/12/2020 which was earlier valid from 01/04/2020 to 30/09/2020.
- LLP Settlement, 2020 extended till 31/12/2020 which was earlier valid from 01/04/2020 to 13/06/2020.
- The Ministry of corporate Affairs had also introduced a scheme for relaxation of time for filing forms related to creation or modification of charges under the Companies Act, 2013 and time for conducting Act 2013 and the time for conducting EGMs through Video Conference or other Audio- Visual Means also extended till 31/12/2020.
- The Ministry of corporate Affairs on 28/09/2020 vide various circulars and notification extended the date of various schemes to 31/12/2020 which were launched for a reason of ease of doing business. The schemes which were extended by the MCA are as follows:
- Companies Fresh Start Scheme, 2020.
- LLP Settlement Scheme, 2020.
- Scheme for relaxation of time for filing forms related to creation or modification of charges.
- Allowed companies to conduct their EGM through Video Conference or other Audio- Visual Means or transact items through Postal Ballot as per the framework provided in the MCA circular earlier.
- Extension of time within which Independent Directors of companies have to register themselves on the databank maintained.
What is the CFSS and LLP settlement scheme? How can it be availed?
- As a result of the receipt of multiple representations from various stakeholders for granting this time opportunity to make the default good, the MCA had vide circular no. 12/20 has notified a scheme for the companies registered in India who have defaulted in filing necessary documents & returns in the past, giving them an opportunity to correct their mistakes without having to go through any prosecution or payment of any hefty sum as penalty.
- This scheme was made effective from 01/04/2020 and has been extended till 31/12/2020 in effect.
Applicability of the Scheme/ Schemes:
- The CFSS scheme is applicable to those companies who have defaulted in filing necessary documents, statements & returns on the MCA 21 registry in compliance with the necessary provisions of the Companies Act, 2013.
This scheme is a kind of golden opportunity to those companies to file such belated documents in accordance with the provisions of the scheme.
- Whereas, the LLP settlement Scheme, 2020 intends to allow a 1/3 condonation of delay in filing statutory documents with the Registrar.