When any application/ document required to be filed with the Central Government or with Registrar and if it is not done within the time limit as specified in the respective provisions under the Companies Act, 2013 then there is need to follow the a separate procedure for Condonation of delay.

As we all know that for each application or form, there is a time limit is fixed by the provision of the law within which it is to be made or filed. If the same is not done for which the time limit is given, however the same may be done by paying the additional fee as per Section 403 of the Companies Act, 2013 read with Companies (Registration, office and fees) Rules, 2014.

Section 460 of the Companies Act, 2013 deals with Condonation of delay in certain cases (corresponds to Section 637B of the Companies Act, 1956. Section 460 of the Companies Act, 2013 came into force from September 12, 2013. It seeks to provide that whenever any application is to be made to Central Government or any document is required to be filed with Registrar within specified time, the Central Government may, after recording the reasons for delay, condone the delay.

Section 460 of the Companies Act, 2013

Notwithstanding anything contained in this Act,—

  1. where any application required to be made to the Central Government under any provision of this Act in respect of any matter is not made within the time specified therein, that Government may, for reasons to be recorded in writing, condone the delay; and
  2. where any document required to be filed with the Registrar under any provision of this Act is not filed within the time specified therein, the Central Government may, for reasons to be recorded in writing, condone the delay.
New Amendment- Section 460 is also applicable to Limited liability Partnership (LLP):

MCA vide its notification dated 30th January 2020, in exercise of the powers conferred by sub-section (1) of section 67 of the Limited liability Partnership Act, 2008 (6 of 2009), the Central Government hereby directs that the provisions of section 460 of the Companies Act, 2013 (18 of 2013) shall apply to a limited liability partnership from the date of publication of this notification in the Official Gazette. The said amendment shall come into force from the date of Official Gazette i.e. 30th January, 2020.

Link of the notification:

https://taxguru.in/corporate-law/section-460-companies-act-2013-applicable-llp.html

In para 22.3 of Company Law Committee report provides that “The Committee also felt that it may be clarified (in the Rules) that, irrespective of the delay, obtaining condonation of delay is not a pre-requisite to filing a document. It is a separate process under section 460 in respect of all belated filings.”

In reference to Section 430 of the Companies Act, 2013 it is to be noted that immunity provided to companies to file within additional 270 days has been done away with. Therefore, any filing beyond timeline specified in respective section will invite additional fees as well as condonation of delay. Also, the default on two or more occasions in submitting, filing, registering or recording of the document, fact or information will attract higher penalty the minimum being twice the additional fee provided in the Act.

SECTION 460 OF THE COMPANIES ACT 2013

Procedure for Condolation of delay:

1. Hold a meeting of the Board or pass Board resolution by circulation:

  • To consider and approve application for condolation of delay to CG;
  • To authorise CS or CFO or any director of the company to make application to CG;
  • To authorise any practising professional or officer of the company to appear before MCA, and execute an authorisation in favour of such representative.

2. File application for condolation of delay with CG in Form CG-1 along with :

  • Copy of the resolution of the Board authorising the filing of the application and appointing authorized representative;
  • Detailed application for condonation of delay;
  • Affidavit indemnifying petition;
  • Memorandum of Appearance;
  • Letter of Authorization;
  • Other required doc.

3. CG will scrutinize the application and issue the final order for other accepting or rejecting the application.

4. The order passed by CG shall be required to be filed with ROC in Form INC-28 along with the requisite documents and fees as per the directions issued by CG,

5. File the respective documents or forms with ROC for which condolation is done along with requisite documents and fees and SRN of Form INC-28.

 Draft Board Resolution:

“RESOLVED THAT pursuant to the provisions of section 460 read with section ——— of the Companies Act, 2013 and rules made thereunder (including any statutory modification/s or re-appointment/s thereof for the time being in force), the consent of the Board be and is hereby accorded to file an application to Ministry of Corporate Affairs (‘MCA’), for condonation of delay in___________________.

RESOLVED FURTHER THAT Mr./Ms. _________, director and __________, Company secretary of the Company be and are hereby jointly/ severally authorized on behalf of the Company, to prepare, execute, sign and file necessary applications(s)/ form(s) with MCA, along with other documents, papers, affidavits, Vakalatnama/ Memorandum of appearance as may be required, to appoint advocates, solicitors, councel or other professionals to appear before MCA, to settle all matters arising out of and incidental thereto, on behalf of the Company and to take all such steps as may be necessary, proper or expedient to give effect to this resolution.”

What if Condonation/ application is not made?

Where the delay is not condoned/ application is not made, this will be specified in the secretarial audit report given in Form MR—3 as well as Certificate in relation to annual return given in Form MGT-8.

(Any query and suggestion kindly contact the author at: sandy673711@gmail.com or +918077133617)

Disclaimer: The entire contents of this document have been prepared on the basis of relevant provisions and as per the information existing at the time of the preparation. Although care has been taken to ensure the accuracy, completeness, and reliability of the information provided, I assume no responsibility, therefore. Users of this information are expected to refer to the relevant existing provisions of applicable Laws. The user of the information agrees that the information is not professional advice and is subject to change without notice. I assume no responsibility for the consequences of the use of such information.

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