Companies Fresh Start Scheme, 2020 – The CFSS Scheme
For the Ministry of Corporate Affairs, the year 2018 was a year of imposing Penalties, striking off the bogus and shell companies, passing disqualification orders against defaulting Directors, putting additional compliances in place for filtering and tracking such shell and Bogus companies and creating embargoes on Corporate Defaulters through various amendments in the Companies Laws to ensure compliances using tighter measures for the Corporate Sector. The Year 2019 was no different as the companies Law regulator introduced the concept Independent director’s data bank and mandatory online proficiency test for Independent Directors and many other new compliance requirements. The MCA also introduced many new reforms to promote ease of doing business in India.
In the beginning of the year 2020, the Companies regulator surprised the stakeholders by introducing and implementing the SPICE+ & Agile pro-web-based forms for the Incorporation of Companies.
Amid all the hoopla and brouhaha surrounding the recent amendment for the increase of Paid-Up share capital Threshold for the appointment of Company Secretaries, the MCA continued surprising the stake-holders by Introducing certain palliative measures through its circular dated 30/03/2020. It comes as a big Succor for the India Inc. especially the Genuine Law Abiding Corporates therein who have a long-standing list of non-compliances due to which they have come on the radar of the India Inc. watch Dog, Registrar of Companies, (ROC) being considered as shell companies and hence are about get struck off because of continuing default in filings.
The #CFSS-2020 – Companies Fresh Start Scheme 2020. (Will be in force from 01-04-2020 t0 30-09-2020)
Chance to file all pending Annual returns, Financial Statements, and other pending returns and Documents at no Additional Fee. Norma fee would have to be paid. No Penalty and Prosecutions will be initiated against the belated filings as such. : Many thousands and evens lakhs will be saved.
1. Which e-forms are not covered:
√ All charge related e-forms
√ MGT -14 – Only such MGT-14 forms will be allowed to file wherein the delay is of not more than 300 days. For MGT-14 with a delay of 300 days or more MGT-14 cannot be filed normally also, had this scheme had not been introduced. Because for delay beyond 300 days, MGT-14 eform prompts to enter SRN of INC-28 filed for condonation of delay for such cases.
2. Is this that easy, no separate application required for availing the scheme like for condoning the delay, Just file the pending forms without additional fees and Hurray! Is that so?
Yes, it is that simple with following riders though:
> No prior application as such for condoning the delay
> Post completion of all the pending filings and after the closure of the scheme but not later than 6 months, the concerned defaulting companies need to file a simple application through e-form CFSS-2020
> Post filing CFSS-2020 an Immunity Certificate will be granted in the form of approval for the said e-form.
3. The Immunity
4. Pre-Conditions for filing Application for Grant of Immunity: Before applying in CFSS-2020 to claim immunity the Prior requirements are:
5. What about the companies where the order has already been passed for belated filing of returns by any adjudicating authority but an appeal could not be made. ?
6. The scheme not to apply in certain cases as follows: