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
123CAppointment of Cost Auditors
2MR-2Form 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
3ADT-2Application for removal of auditor(s) from his/their office before expiry of term
4NDH-2Application for extension of time
5DIR-3CIntimation of Director Identification Number by the company to the registrar
6INC-12Application for grant of License under section 8
7MSC-1Application to ROC for obtaining the status of dormant company
8DIR-12Particulars of appointment of directors and the key managerial personnel and the changes among them
9INC-4Intimation for Change in Member/Nominee
10INC-6One Person Company – Application for Conversion
11INC-22Notice of Situation or Change of situation of Registered Office of the Company
12INC-27Conversion of public company into private company or private company into public company
1320BAnnual Return
1421AAnnual Return for company having no share capital
1523BNotice by Auditor
1623DInformation by cost auditor to Central Government
1723ACFiling balance sheet and other documents with the Registrar
1823AC-XBRLForm for filing XBRL document in respect of balance sheet and other documents with the Registrar.
19Form 66Form for submission of Compliance Certificate
20AOC-4Form for filing financial statement and other documents with the Registrar
21AOC-4 CFSForm for filing consolidated financial statements and other documents with the Registrar
22AOC-4(XBRL)Form for filing XBRL document in respect of financial statement and other documents with the Registrar
23ADT-1Information to the Registrar by company for appointment of auditor
24ADT-3Notice of Resignation by the Auditor
25BEN-2Return to the Registrar in respect of declaration under section 90
26CRA-2Form of Intimation of appointment of cost auditor by the company to Central Government
27CRA-4Form for filing Cost Audit Report with the Central Government
28DPT-3Return of deposits
29DPT-4Statement regarding deposits existing on the commencement of the Act
30GNL-2Form for submission of documents with the Registrar
31INC-5One Person Company- Intimation of exceeding threshold
32IEPF-1Statement of amounts credited to the Investor Education and Protection Fund
33IEPF-2Statement of unclaimed or unpaid amounts
34IEPF-3Statement of shares and unclaimed or unpaid dividend not transferred to the Investor Education and Protection Fund
35IEPF-4Statement of shares transferred to the Investor Education and Protection Fund
36IEPF-6Statement of unclaimed or unpaid amounts to be transferred to the Investor Education and Protection Fund
37IEPF-7Statement of amounts credited to IEPF on account of shares transferred to the fund
38IEPF-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

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