FAQs on filing Form CAR (Company Affirmation of Readiness towards COVID-19)

As all of you are aware that Ministry of Corporate Affairs (MCA) issued advisory on preventive measures to contain spread of COVID-19 to all Chairman, Managing Director and Chief Executive Officer. With respect of it, they will deploy “Company Affirmation of Readiness towards COVID-19 (CAR) web-based form on 23rd March, 2020 to ensure that “work from home” policy is followed by all the LLPs and Companies to show their readiness against fight with COVID-19.

As per the said advisory, all Companies /LLPs are expected and strongly advised to put in place an immediate plan to implement the “Work from home” policy in their headquarters and field offices, to the maximum extent possible, as a temporary measure till 31st March, 2020. Even with the essential staff on duty, staggered timings may be followed, so as to minimize physical interaction.

Therefore, in our view, what matters is the preparedness itself, not so much the task of having the so-called policy or the filing of the form itself.

However, the country has a few lakhs of companies, and the affirmation of preparedness by filing this form will be expected from all the companies. Hence, there is understandably a barrage of questions from clients and others.

Hope all stakeholders will get answer of their query from following FAQs :-

Q.1 Which entities have to fill form CAR-2020?

Ans: All Indian companies, foreign companies, LLPs and foreign LLPs

Q.2 What is the due date for filing CAR-2020?

Ans: The CAR form has to be filed w.e.f. 23rd March, 2020. While no clear due date has been mentioned to file the form, however, since the current work from advisory is till 31st March, 2020, therefore, it is presumed that the said form should be filed before that.

Q.3 Is CAR-2020 form statutory?

Ans: CAR-2020 has emanated from the advisory issued by MCA and not from any circular or notification. To that extent, it is not statutory. However, it is highly recommended to file this form to enable the Ministry to gather data on the preparedness to tackle COVID-19 by corporates.

Q.4 What are the steps being suggested through the Advisory?

Ans: Companies and LLPs are being advised to put in place an immediate plan to implement a ‘work from home’ policy as a temporary measure.

Q.5 Whether there is any penalty for non-filing of Form CAR-2020?

Ans: Form has been deployed as a purely confidence building measure to assess the readiness of the companies to deal with COVID-19 Threat in India. As such no penalty or enforcement related action is applicable. Stakeholders may at their convenience file this form. It is purely voluntary as part of our contribution towards joining the movement to fight against the spread of the disease. Since the portal may experience heavy load, it would indicate ‘Busy’ alert whenever peak traffic is reached.

Q.6 What are the key details to be filled in the form CAR-2020?

Ans: It’s a simple web-based form containing the following details:

a) CIN/ FCRN/ LLPIN/ FLLPIN

b) Name of the company/ foreign company/ LLP/ Foreign LLP (Prefilled)

c) Whether the company/ LLP is in compliance of COVID 19 Guidelines? – Yes or No

d) Authorized Signatory of the company/ LLP: DIN/ PAN/ Membership No. of the Authorised Signatory

e) Mobile No. (Pre-filled, if available in the database, else can be manually entered)

f) OTP (received on the mobile number instantly)

Q.7 What is the object of having such a plan?

Ans: The object of having such a plan is to ensure social distancing as advised by WHO and other public health authorities in the recent outbreak of COVID-19 which is required for preventing the rapid spread and transmission of the disease at community level.

Q.8 Who is authorized to file the form and are any Digital signatures required?

Ans: Any authorized signatory of the entity (being the Director / KMP / CS) having a valid DIN/ PAN / Membership number and who is currently associated with the said entity on MCA portal can file this form. No digital signatures are required to fill this form. However, this form is available to all Registered Users and Business Users, post login at the MCA portal, by the name COVID-19 (under MCA services).

Q.9 Is there any fee for filing the form?

Ans: There is no filing fee and no SRN will be generated. After filing the form, just an email acknowledgement will be received by the Company mail id and at the mail id of the authorized signatory.

Q.10 What do “COVID-19 guidelines” mean (as mentioned in the form)?

Ans: COVID-19 guidelines have not been defined anywhere. There are no separate COVID-19 guidelines for Corporates except for the advisory issued by the MCA, available at the MCA home page, advising the corporates to offer work from home to its employees in the headquarters as well as field offices.

Q.11 What all does a work from home policy include?

Ans: As we said above, we are not envisaging this to be a formal document. However, please do consider the following:

  • Who all can be permitted to work from home – for those who have to be present, whether there is rotational or staggered presence?
  • What will be the weekly and daily working hours?
  • Whether necessary equipment or software is in place for working from home?
  • Whether there will be any revision in compensation and benefits paid to the employees?
  • Whether employees have adequate internet connection required for the job?
  • What level of dedication and concentration is expected from employees during working hours?
  • What will be the method of marking attendance or absence?
  • Who will review work of whom and how?
  • Revision in employees code of conduct
  • How to maintain and ensure confidentiality of information
  • Installation of necessary software for group discussions or meetings
  • To educate remote employees on basic security policies as for example use of VPN is a secure channel and better than public network
  • Establishment of virtual employee allowance or reimbursements for expenses such as internet, phone, electricity and other utilities
  • Strict adherence to do’s and don’ts issued by public health authorities from time to time
  • Date of implementation of this policy- with immediate effect till 31st March, 2020 (tentative date, maybe extended depending upon the situation)

Q.12 Do I mandatorily need to offer work from home to all employees?

Ans: It is expected and strongly advised to Corporates to offer work from home to all employees. In case an essential staff is required on duty, staggered timings may be followed, so as to minimize physical interaction. Therefore, to that extent is it not mandatory to offer work from home to all employee, although it is highly recommended. However, every one (including all corporates) will have to follow the state / city lock-down orders, travel advisories etc. issued by the appropriate authorities from time to time.

Q.13 My company does not have any permanent employees. Am I still required to adhere to this policy?

Ans: If there are no permanent employees, it is all peace as far as your company is concerned. Go and file the form and say you have taken necessary steps.

Q.14 What if employees at certain locations are working from home, while others are not?

Ans: If any Corporate has offered work from home for employees, wherever it is possible, and has made other alternate arrangements to ensure the safety, security and minimum physical interaction of the other staff, the said Corporate may file “Yes” in the CAR form to report preparedness to tackle COVID-19 pandemic.

I am sure this information will help all of us in advising our Boards / Managements / Clients appropriately and comply in letter and spirit.

DISCLAIMER: THE ARTICLE IS BASED ON THE RELEVANT PROVISIONS AND AS PER THE INFORMATION EXISTING AT THE TIME OF THE PREPARATION. IN NO EVENT I SHALL BE LIABLE FOR ANY DIRECT AND INDIRECT RESULT FROM THIS ARTICLE. THIS IS ONLY A KNOWLEDGE SHARING INITIATIVE.

THE AUTHOR – CS DEEPAK SETH (ASSOCIATE PARTNER HELPINGHANDS PROFESSIONALS LLP) AND CAN BE REACHED AT CONTACTHHPRO@GMAIL.COM OR 9910248911.

Author Bio

Qualification: CS
Company: HELPINGHANDS PROFESSIONALS LLP
Location: NEW DELHI, New Delhi, IN
Member Since: 12 Jun 2018 | Total Posts: 45
CS Deepak Seth is an Associate Member of Institute of Companies Secretaries of India having good experience in legal and secretarial matters. He is graduate from Delhi University and Post graduate from IGNOU University. He is also MBA in Finance and LLB Deree holder. He possesses professional experi View Full Profile

My Published Posts

More Under Company Law

Leave a Comment

Your email address will not be published. Required fields are marked *