Scheme for Relaxation of Time Period for Filling Forms Related to Creation or Modification of Charges Under  Companies Act, 2013

Relevant Circular: MCA Circular dated 17.06.2020

Relevant Sections: Section 77 and Section 78 of the Companies Act, 2013.

Reason of the Circular

1. As per section 77 of the Companies Act, 2013, the companies are required to file forms related to creation or modification of charge within such time period as provided in the section i.e the total time period of 120 Days from the date of its creation or modification.

2. In case company fails to register the charge within 30 days from the date of its creation or modification, the chargeholder may file form relating to modification or creation of charge under section 78 of the Act, within the overall time period for filling the form under section 77 of the Act.

3. Various representation have been received in ministry, requesting that the timeliness related to filling of certain charge related forms may be suitably relaxed so as to provide a window of compliance for registration of charge.

4. The CFSS, 2020 dated 30.03.2020, under this scheme the benefit of waiver of additional fees was not extended to the charge related documents, therefore it has been suggested that some dispensation may be provided for filling of charge related document as well.

Introduction of Scheme for relaxation of time for filling forms related to creation or modification of charge under the Companies Act, 2013.

As per section 460 read with section 403 of the Companies Act, 2013, the Central Government has decide to introduce a scheme named above.

Purpose of the Scheme

To condoning the delay in filling certain forms relating to creation or modification of charge.

Features of the Scheme

1. Effective date of the Scheme: 17th June 2020.

2. Applicability:

The scheme shall be applicable in respect of filling of Form CHG-1 & CHG-9 by a Company or Chargeholder.

Its applicable where date of creation or modification :

a. is before 1st March 2020, but the timeline for filling such form had not expired u/s 77 of the Act as 1st march 2020, or

b. falls on date between 1st March 2020 and 31st March 2020.

Non- Applicability of the Scheme

The Scheme shall not apply, in case:

(a) The forms CHG-1 and CHG-9 had already been filed before the date of issue of this Circular.

(b) The timeline for filing the form has already expired under section 77 or section 78 of the Act prior to 01.03.2020.

(c) The timeline for filing the form expires at a future date,

(d) Filing of Form CHG-4 for satisfaction of charges.

Relaxation in the Time period (1st Day of Time Period Start From 01.10.2020 for the purpose of filling form CHG- 1 & CHG-9)

1. In case a form is filed in respect of a situation covered under sub-para (ii)(a) above, the period beginning from 01.03.2020 and ending on 30.09.2020 shall not be reckoned for the purpose of counting the number of days under section 77 or section 78 of the Act. In case, the form is not filed within such period, the first day after 29.02.2020 shall be reckoned as 01.10.2020 for the purpose of counting the number of days within which the form is required to be filed under section 77 or section 78 of the Act.

2. In case a form is filed in respect of a situation covered under sub-para (ii)(b) above, the period beginning from the date of creation/modification of charge to 30.09.2020 shall not be reckoned for the purpose of counting of days under section 77 or section 78 of the Act. In case, the form is not filed within such period, the first day after the date of creation/modification of charge shall be reckoned as 01.10.2020 for the purpose of counting the number of days within which the form is required to be filed under section 77 or section 78 of the Act.

Chart Format

How the fees will be levy

1. In regard to sub-para (iii)(a) above, if the form is filed on or before 30.09.2020, the fees payable as on 29.02.2020 under the Fees Rules for the said form shall be charged. If the form is filed thereafter, the applicable fees shall be charged under the Fees Rules after adding the number of days beginning from 01 . 10.2020 and, ending on the date of filing plus the time period lapsed from the date of the creation of charge till 29.02.2020.

2. In regard to sub-para (iii)(b) above, if the form is filed before 30.09.2020, normal fees shall be payable under the Fees Rules. If the form is filed thereafter, the First day after the date of creation/modification of charge shall be reckoned as 01.10.2020 and the number of days till the date of filing of the form shall be counted accordingly for the purposes of payment of fees under the Fees Rules.

Applicability of Fees

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