Companies Fresh Start Scheme, 2020 (CFSS,2020)
All about Companies Fresh Start Scheme, 2020
The impact of COVID-19 is dangerous as the virus is easily communicable and there is no specific antidote for the same. Government is trying their best to protect the interest of people to the extent they can. With this intent, they have introduced the Companies Fresh Start Scheme, 2020 (CFSS-2020) which provide a one time opportunity to all non compliant companies to start a fresh and complete their compliances without payment of additional fees. The detailed about the scheme introduced is as follows:
Definitions
- Default: Default means failure in filing of documents on due date and are still pending for filing (also referred as belated filing).
- Defaulting Companies: Defaulting Companies means a Company which has made the default of non-filing of documents
- Inactive Companies: Inactive Companies means a company which has not been carrying on any business or operation, or has not made any significant accounting transaction during the last two financial years, or has not filed financial statements and annual returns during the last two financial years
- Immunity Certificate: Immunity Certificate is the certificate issued by the Designated Authority (herein reffered to Registrar of Companies) on the basis of completion of filing of belated documents and declaration made in E-form CFSS-2020.
Duration of the Scheme
The scheme shall be in effect from 01.04.2020 till 30.09.2020.
Applicability of the Scheme
Any company which failed to comply any of the compliances on any given date with respect to filing of documents, statement, returns etc. with MCA-21 registry and the same is still pending to be filed can complete their compliances within the effective period of the scheme with normal fees. No additional fee will be levied on completion of such filing with the MCA-21 registry. Further note that the immunity with respect to prosecution or proceeding shall be provided with respect to the belated filings only. Any other consequential proceedings or violation of Companies Act, 2013 and amendment thereof shall not be covered under this immunity.
Manner of filing
Every defaulting company can file belated documents with normal fees. The belated documents include all types of documents related to general compliances, annual compliances, Active Compliances and all other compliances except increase in authorised share capital and charge related documents.
After closure of this Scheme, an application for seeking immunity certificate shall be filed in E-form CFSS-2020 and after the documents are taken on file/ record/ approved by the Registrar of Companies but not after 6 months from the closure of the Scheme. The Registrar of Companies (ROC) shall grant the immunity certificate based on the declaration made under Eform CFSS-2020.
No fee shall be paid for filing of E-form CFSS-2020 for obtaining the immunity certificate.
Further, this certificate shall not be applicable in the matter of any appeal or management disputes pending before the court of law.
The companies which are inactive while filing their documents under CFSS, 2020 can simultaneously apply for striking off or seek for dormant status.
Forms Covered under the Scheme
List of Forms covered under the Scheme are:
- Annual forms: Form AOC-4, Form AOC-4 XBRL, Form AOC-4 CFS, Form MGT-7, Form CRA-4, 23AC, Form 23AC XBRL, Form 23ACA, Form 66, Form 20B, Form 21A, Form A- XBRL, Form I-XBRL
- Appointment of Statutory Auditor and Cost Auditor: Form ADT-1, Form ADT-2, Form ADT-3, Form CRA-2, Form 23B, Form 23D, Form 23C
- Appointment/ Change/ Resignation of Directors and KMP and their remuneration and KYC: Form DIR-12, Form MR-1, Form MR-2, Form DIR-11, Form DIR-3C, DIR-3KYC/Web form
- Nidhi Forms: Form NDH-1, Form NDH-2, Form NDH-3, Form NDH-4
- Foreign Company Forms: Form FC-1, Form FC-2, Form FC-3, Form FC-4
- Incorporation Forms: Form INC-12, Form INC-4, Form INC-5, Form INC-6, Form INC-22, Form INC-27, INC-22A, INC-20A
- IEPF Forms: Form IEPF-1, Form IEPF-2, Form IEPF-3, Form IEPF-4, Form IEPF-5 e-verification report, Form IEPF-6, Form IEPF-7
- Deposits forms: Form DPR-3, Form DPT-4
- Other Forms: Form MSC-1, Form MSC-3, Form BEN-2, Form GNL-2, Form GNL-3, Form PAS-3, Form AOC-5, Form MGT-6, Form MGT-10, Form MGT-14, Form MGT-15
What is not covered under the Scheme
The Scheme shall not be applicable in the following cases:
- Prosecution or proceeding related to matters other than belated filings
- Matters where court has ordered conviction in any matter or order imposing penalty has been passed and no appeal has preferred against such orders on or before 29.02.2020
- Companies under process of striking off
- Companies who have filed application for strike off
- Companies which have amalgamated under scheme of compromise and arrangement
- Companies which have filed application for Dormant status
- Vanishing Companies
- Matters related to
– Increase in authorised share capital
– Charge related documents
– Appeal against prosecution or proceeding with respect of delay in filing of documents has been made by the applicant (to avail this scheme applicant needs to withdraw the appeal and furnish proof of such withdrawal)
Benefits of filing
The benefits of filing under the Scheme are that:
- Normal fees as applicable is to be paid
- Waiver of additional fee irrespective of duration of delay
- After receipt of immunity certificate, the Registrar of Companies shall withdraw all its prosecution pending or proceeding of adjudication with respect to non-filing of documents with the ROC
- Company shall become an active compliant on successful issuance of immunity certificate
Consequences of not availing the benefit of CFSS, 2020
The ROC shall take necessary action against non-compliant companies and their officer in default. The ROC shall have the power to file a case against those companies and also seek prosecution of the officer of defaults.
Things to be noted down
- The Scheme is applicable only for belated filing of documents, returns, statement etc.
- Any matter in appeal with respect to delayed filing will be considered only after providing proof of withdrawal of appeal before seeking immunity
- Immunity Certificate shall be issued pursuant to filing of E-form CFSS-2020 by the ROC
- No fee shall be paid for filing of CFSS-2020, which shall be filed only after the closure of the scheme
- Immunity Certificate shall be issued by the ROC only after the form filed has been take on record/ approved by the ROC.
Conclusion
This is best one-time opportunity provided to the stakeholders to complete all their pending compliances without making payment of additional fees. In case you wish to complete any of your pending compliances without any hassle, feel free to contact us @complianceship@gmail.com or @+91-7838657554 / @+91-8010233173 or you can also visit our website www.complianceship.com .