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Companies Fresh Start Scheme 2020 – as announced by MCA

Ministry of Corporate Affairs (MCA) has now come up with relief for all law-abiding Companies, who defaulted in any of their previous filings with Registrar of Companies (ROC). Ministry for all default adjustments of companies has introduced Companies Fresh Start Scheme, 2020 where another opportunity is being given to companies to re-initiate their pending fillings with their respective ROCs without any additional fee to be given.

The Scheme was announced in wake of the COVID-19 outbreak, where the Ministry proposed for incentivizing the corporate sector with a kind opportunity to make complete all their pending fillings good with the authorities and do a fresh start as fully compliant entities.

Companies Fresh Start Scheme, 2020

Introduction

The Companies Fresh Start Scheme, 2020 aims to extend the timeline and reduce the financial burden on companies to comply with their filing requirements under the Companies Act and the Rules made thereunder. The Scheme proposes an opportunity to non-compliant companies to make a “Fresh Start”.

The Scheme immunes all companies from penal proceedings held against them due to non-compliance or non-fillings. Within the scheme benefits, companies can file an appeal before the concerned Regional Directors to provide an extension in the duration of compliance fillings which had earlier become time-barred.

All companies which are required to make statutory compliance filings including Annual return, financial statements or other documents as prescribed within the Companies Act, shall be benefitted from this scheme.

CFSS Key benefits:

  • Opportunity to defaulting companies to file belated documents to ROC (MCA-21 Registry).
  • No proceeding, the prosecution shall be undertaken against companies for non-compliance or non-filings if opting for this scheme and updating all pending compliances.
  • No penalty or fee shall be payable (provided under Section 403 of Companies Act, 2013) in addition to the normal compliance charges by authorities or ROC for compliance filling under this scheme.
  • Companies declared as inactive in MCA records, shall be given another chance to change their state to dormant companies by filling a simple application form with making payment of normal fees.
  • For Companies, if any appeal pending against order of any adjudicating authority or any competent court under Section 454(6) falls between 1st March to 31st May 2020 an extension of 120 days to such appeal fillings has been given under the scheme.

Scheme Duration

Receipt of filing applications and compliance requests under the scheme shall be done from 1st April 2020 and up to 30th September 2020.

Fillings under Companies Fresh Start Scheme, 2020

For raising the application of immunity against penalties, orders or any proceedings companies have to file a response to the Ministry and ROC, through an e-form CFSS.

No fees in addition to the normal compliance cost or charges involved in the appeal or proceeding shall be charged for the filing of e-form CFSS.

For companies to declare themselves as dormant, they have to file e-Form MSC-1 with prescribed fees.

For striking off the name of the company, e-Form STK-2 along with applicable fees is to be submitted.

CFSS –  Eligible Compliances

In addition to the application e-form CFSS, MCA notified the following compliances and forms to be filed by companies under CFSS  to avail discount of penalties or waiver of additional fees imposed:

S No. Form No. Description
1 23C Appointment of Cost Auditors
2 MR-2 Form of Application to the Central Government for approval of appointment or reappointment and remuneration or increase in remuneration or waiver for excess or over payment to managing director or whole time director or manager and commission or remuneration to directors
3 ADT-2 Application for removal of auditor(s) from his/their office before expiry of term
4 NDH-2 Application for extension of time
5 DIR-3C Intimation of Director Identification Number by the company to the registrar
6 INC-12 Application for grant of License under section 8
7 MSC-1 Application to ROC for obtaining the status of dormant company
8 DIR-12 Particulars of appointment of directors and the key managerial personnel and the changes among them
9 INC-4 Intimation for Change in Member/Nominee
10 INC-6 One Person Company – Application for Conversion
11 INC-22 Notice of Situation or Change of situation of Registered Office of the Company
12 INC-27 Conversion of public company into private company or private company into public company
13 20B Annual Return
14 21A Annual Return for company having no share capital
15 23B Notice by Auditor
16 23D Information by cost auditor to Central Government
17 23AC Filing balance sheet and other documents with the Registrar
18 23AC-XBRL Form for filing XBRL document in respect of balance sheet and other documents with the Registrar.
19 Form 66 Form for submission of Compliance Certificate
20 AOC-4 Form for filing financial statement and other documents with the Registrar
21 AOC-4 CFS Form for filing consolidated financial statements and other documents with the Registrar
22 AOC-4(XBRL) Form for filing XBRL document in respect of financial statement and other documents with the Registrar
23 ADT-1 Information to the Registrar by company for appointment of auditor
24 ADT-3 Notice of Resignation by the Auditor
25 BEN-2 Return to the Registrar in respect of declaration under section 90
26 CRA-2 Form of Intimation of appointment of cost auditor by the company to Central Government
27 CRA-4 Form for filing Cost Audit Report with the Central Government
28 DPT-3 Return of deposits
29 DPT-4 Statement regarding deposits existing on the commencement of the Act
30 GNL-2 Form for submission of documents with the Registrar
31 INC-5 One Person Company- Intimation of exceeding threshold
32 IEPF-1 Statement of amounts credited to the Investor Education and Protection Fund
33 IEPF-2 Statement of unclaimed or unpaid amounts
34 IEPF-3 Statement of shares and unclaimed or unpaid dividend not transferred to the Investor Education and Protection Fund
35 IEPF-4 Statement of shares transferred to the Investor Education and Protection Fund
36 IEPF-6 Statement of unclaimed or unpaid amounts to be transferred to the Investor Education and Protection Fund
37 IEPF-7 Statement of amounts credited to IEPF on account of shares transferred to the fund
38 IEPF-5 e-verification report

Application to the authority for claiming unpaid amounts and shares out of Investor Education and Protection Fund (IEPF) – E-verification report

39 I-XBRL Form for filing XBRL document in respect of cost audit report and other documents with the Central Government
40 MGT-7 Annual Return
41 MR-1 Return of appointment of key managerial personnel
42 MSC-3 Return of dormant companies
43 NDH-1 Return of Statutory Compliances
44 NDH-3 Return of Nidhi Company for the half year ended
45 NDH-4 Application for declaration as Nidhi Company and for updation of status by Nidhis
46 PAS-3 Return of allotment
47 SH-11 Return in respect of buy-back of securities
48 A-XBRL Form for filing XBRL document in respect of compliance report and other documents with the Central Government
49 DIR-3 KYC/Web form Application for KYC of Directors
50 FC-1 Information to be filled by Foreign company
51 FC-2 Return of alteration in the documents filed for registration by foreign company
52 FC-3 Annual accounts along with the list of all principal places of business in India established by foreign company
53 FC-4 Annual Return of a Foreign Company
54 INC-22A Active Company Tagging Identities and Verification (ACTIVE)
55 INC-20A Declaration for commencement of business
56 AOC-5 Notice of address at which books of account are maintained
57 DIR-11 Notice of resignation of a director to the Registrar
58 GNL-3 Particulars of person(s) or key managerial personnel charged or specified for the purpose of sub-clause (iii) or (iv) of clause 60 of section 2
59 INC-20 Intimation to Registrar of revocation/surrender of license issued under section 8
60 INC-28 Notice of order of the Court or Tribunal or any other competent authority
61 MGT-6 Return to the Registrar in respect of declaration under section 89 received by the company
62 MGT-10 Changes in shareholding position of promoters and top ten shareholders
63 MGT-14 Filing of Resolutions and agreements to the Registrar under section 117
64 MGT-15 Form for filing Report on Annual General Meeting
65 Form 27 LLP Form for registration of particulars by Foreign Limited Liability Partnership (FLLP
66 FORM 3 Information with regard to limited liability partnership agreement and changes, if any,made therein
67 FORM 8 Statement of Account & Solvency
68 FORM 15 Notice for change of place of registered office
69 FORM 11 Annual Return of Limited Liability Partnership (LLP)
70 FORM 4 Notice of appointment, cessation, change in name/ address/designation of a designated partner or partner and consent to become a partner/designated partner
71 FORM 5 Notice for change of name
72 FORM 12 Form for intimating other address for service of documents
73 FORM 22 Notice of intimation of Order of Court/ Tribunal/CLB/ Central Government to the Registrar
74 FORM 31 Application for compounding of an offence under the Act
75 FORM 23 Application for direction to Limited Liability Partnership (LLP) to change its name to the Registrar
76 Form 29 LLP Notice of (A) alteration in the certificate of incorporation or registration; (B) alteration in names and addresses of any of the persons authorised to accept service on behalf of a foreign limited liability partnership (FLLP) (C) alteration in the principal place of business inIndia of FLLP (D) cessation to have a place of business in India

Things to Know

  • The Scheme immune’s only companies for default in penalties or compliance filings or against proceedings held against the company, it does not cover any proceedings involving the interest of stakeholders, directors or any key managerial personnel of the company.
  • For claiming immunity under the scheme towards appeals held against the company passed by an adjudicating authority or any competent court for any violation shall have to be made only after the withdrawal of the appeal and submission of withdrawal of the appeal with the immunity application.
  • The Scheme shall not be applicable for matters where any appeal is pending before the court of law or in case of management disputes held before the law.
  • The Scheme cannot be availed if any penalty or conviction has been passed by any adjudicating authority with a clause that no appeal against such order has to be preferred.
  • The Scheme cannot be availed by companies against which a striking off name order under Section 248 has been issued or if the company has voluntarily applied for striking off name from the register.
  • The Scheme is ineligible for companies under the scheme of amalgamation or has amalgamated or to vanishing companies.
  • The Scheme shall be ineligible for companies who have applied for any increase in the authorized capital or where companies are marked as under CIRP (Corporate Insolvency Resolution Process) or liquidation under IBC,2016.

Revive your company with CFSS.

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