The outbreak of the coronavirus (COVID-19) is an unprecedented event that has led to the lockdowns and unanticipated restrictions on the public as well as the corporate sector in the various country of the world. Similar India has also been affected by the second wave of coronavirus and to control the spread of Covid-19, the Government of India has inter alia ordered all establishments, except essential goods and services, to temporarily close their physical offices. Employees are working remotely (Work from Home), but various difficulties are faced due to lack of office facilities, which leads to unnecessarily delay in compliances of various applicable laws. Keeping in mind the aforesaid, the government of India has temporarily relaxed several compliance requirements for the corporate sector through various notifications.
- Gap between two Board Meetings
- As per Section 173 of the Companies Act, 2013 every company shall hold a minimum number of four meetings of its Board of Directors every year in such a manner that not more than one hundred twenty days shall intervene between the two consecutive Board Meetings.
- The Ministry of Corporate Affairs has extended the time between the board meetings required to be held in the first and second quarter of the year from 120 days to up to 180 days.
- Every company is required to hold at least four meetings for its Board of Directors every year and the gap between two meetings could not exceed 120 days. MCA has increased the permissible time gap between two meetings consecutively from 120 days to 180 days for the 1st quarter (i.e., April 2021-June 2021) and the 2nd quarter (i.e., July 2021- September 2021).
Notification Link: http://www.mca.gov.in/Ministry/pdf/GeneralCircularNo8_03052021.pdf
- Creation and Modification of Charges
As per Section 77 of the Companies Act, 2013 the form CHG-1 and Form CHG-9 related to the creation of charge and modification of charge has to be filed within the period of maximum 120 days from the date of creation or modification of the charge.
According to the circular issued by the MCA dated 03rd May 2021 its applicability shall be as follow:
CASE A:
If the charge creation or modification is done before 01st April 2021: If the creation or modification of charge is done before 01st April 2021 but the timeline for filing the form has not expired under section 77 of the Companies Act, 2013 as of 01st April 2013. (In other words, the scheme will be applicable for the charge created or modified on and after 02nd December 2020.
TIMELINES:
The period beginning from 01st April 2021 and ending on 31st May 2021 shall not be reckoned for filing of Forms fall under section 77 & section 78 of the Companies Act, 2013.
In case the form is not filed till May 31, 2021, the first day after March 31, 2021, shall be June 01, 2021.
FEES:
If the company file form between 01st April 2021 to 31st May 2021 then fees applicable on such form as on 31st March 2021, required to be pay till 31st March 2021.
If the Company file form till 31st May 2021, then 01st June 2021, shall be considered as next day of 31st March 2021, for fees payable on Charge Form.
CASE B:
If the charge creation or modification is done between 01st April 2021 to 31st May 2021:
Timelines: The period beginning from 01st April 2021 and ending on 31st May 2021 shall not be reckoned for filing of Forms fall under section 77 & section 78 of the Companies Act, 2013.
Notification Link: http://www.mca.gov.in/Ministry/pdf/GeneralCircularNo7_03052021.pdf
- Relaxation on levy of additional fee
The Ministry of Corporate Affairs vide its General Circular No 06/2021 Dated 03rd May 2021 has granted additional time to the Companies and LLP up to 31st July 2021 for the form which was due for filing during the period of 01st April 2021 to 31st May 2021 (except Form CHG 1, Form CHG 4 and Form CHG 9)
For the delayed filing of such form till 31st July 2021, only the nominal fee shall be chargeable from Companies/ LLP.
Due to various speculations, the MCA has specified a list of forms covered under the circular.
| S.NO | FORM | FORM DESCRIPTION |
| 1. | FORM ADT-1 | Information to the Registrar for appointment of auditor by the company. |
| 2. | FORM INC-22 | Notice of Situation or Change of situation of Registered Office of the Company |
| 3. | FORM NDH-3 | Return of Nidhi Company for the half year ended |
| 4. | FORM FC-4 | Annual Return of a Foreign Company |
| 5. | FORM MSC-3 | Return of dormant companies |
| 6. | FORM INC-27 | Conversion of public company into private company or private company into public company |
| 7. | FORM NDH-2 | Application for extension of time |
| 8. | FORM-IEPF-3 | Statement of shares and unclaimed or unpaid dividend not transferred to the Investor Education and Protection Fund |
| 9. | FORM AOC-4 | Form for filing financial statement and other documents with the Registrar |
| 10. | FORM AOC-4 NBFC | Form for filing financial statement and other documents with the Registrar for NBFCs |
| 11. | FORM AOC-4 XBRL | Form for filing XBRL document in respect of financial statement and other documents with the Registrar |
| 12. | FORM MGT-7 | Form for filing annual return by a company |
| 13. | LLP Form 3 | Information with regard to limited liability partnership agreement and changes, if any, made therein. |
| 14. | LLP Form-11 | Annual Return of Limited Liability Partnership (LLP) |
| 15. | FORM DIR-11 | Notice of resignation of a director to the Registrar |
| 16. | FORM MGT-14 | Filing of Resolutions and agreements to the Registrar |
Notification Link: http://www.mca.gov.in/Ministry/pdf/GeneralCircularNo6_03052021.pdf
Notification Link: http://www.mca.gov.in/Ministry/pdf/FeeWaiver_13052021.pdf
- Spending of CSR Funds
According to Section 135 of the Companies Act 2013 the specified companies has to spend at least 2% of their three-year annual average net profit towards Corporate Social Responsibility following Schedule VII.
It was clarified that spending CSR funds for “setting up makeshift hospitals and temporary COVID care facilities” is an eligible CSR activity under item no. (i) and (xii) of Schedule VII of the Companies Act, 2013 related to the promotion of health care, including preventive health care and disaster management, respectively.
Notification Link: http://www.mca.gov.in/Ministry/pdf/GeneralCircularNo5_22042021.pdf
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Posted by:
CS Neetu Saini
AKGVG & Associates