Be ready to file Form PAS-6 [Reconciliation of Share Capital Audit Report (half-yearly)] till 13th September, 2020

The Ministry of Corporate Affairs (MCA) has introduced a new form i.e. Form PAS-6 [Reconciliation of Share Capital Audit Report (half-yearly)] which is basically used for the reconciliation of the share capital audit report on the half-year basis. Form PAS-6 is introduced w.e.f 30.09.2019 in pursuance to the sub-rule (8) of rule 9A of the Companies (Prospectus and Allotment of Securities) Rules, 2014.

MCA vide its Notification No. 376(E) Dated 22nd May, 2019 has amended the Companies (Prospectus and Allotment of Securities) Rules, 2014 as the Companies (Prospectus and Allotment of Securities) Third Amendment Rules, 2019 w.e.f. 30.09.2019. By this Amendment MCA amended existing Sub-Rule 8 and inserted new Sub-Rule 8A in the main Rule 9A, as under:

“(8) Every unlisted public company governed by this rule shall submit Form PAS-6 to the Registrar with such fee as provided in Companies (Registration Offices and Fees) Rules, 2014 within sixty days from the conclusion of each half year duly certified by a company secretary in practice or chartered accountant in practice.

(8A) The company shall immediately bring to the notice of the depositories any difference observed in its issued capital and the capital held in dematerialised form.”.

Before the above amendment, Sub rule 8 of Rule 9A deals with the filing of Share Capital Reconciliation Audit report on half yearly basis with ROC, same is stated as under:

(8)“The audit report provided under regulation 55A of the Securities and Exchange Board of India (Depositories and participants) Regulations, 1996 shall be submitted by the unlisted public company on a half-yearly basis to the Registrar under whose jurisdiction the registered office of the company is situated.” 

It is pertinent to note that this sub rule 8 created lot of ambiguities because it didn’t provide for the form in which and time within which such report to be filed with ROC and the SEBI (DP) Regulations, 1996 has been replaced by SEBI (DP) Regulations, 2018 w.e.f. 03rd October, 2018. Therefore, various representation were filed before MCA regarding practical difficulties faced by the professionals and company while filing such report to ROC.

Therefore, MCA vide notification dated 22nd May, 2019, amended existing Sub-Rule 8 and inserted new Sub-Rule 8A in the main Rule 9A, which is effective from 30th September, 2019.

In view of the above, PAS-6 has to be filed within sixty days from the conclusion of each half year (i.e. on 30th September and 31st March).  All information shall be furnished for the hall year ended 30th September and 31st March in every financial year for each ISIN separately.

However, later on, MCA has received representation regarding extension of the last date of filing of PAS 6 under Rule 9A(8) of the Companies (Prospectus and Allotment of Securities) Rules, 2014.

The matter was examined by MCA and it was stated by MCA vide its General Circular No. 16/2019 dated 28.11.2019, that the time limit for filing Form PAS-6 without additional fees for the half year ended on 30.09.2019 will be sixty days from the date of deployment of this form on the website of the Ministry.

Now, MCA has made available the Form PAS-6 for filling w.e.f. 15th July, 2020. Accordingly, the last date for filing the Form PAS-6 for the half-year ended on 30th September, 2019 and 31st March, 2020 will be 13th September, 2020.

Non-Applicability.

The above rule, Rule 9A of Companies (Prospectus and Allotment of Securities) Rules, 2014 not applicable on the following unlisted public Companies: –

(a) Nidhi Company

(b) Government Company

(c) Wholly owned subsidiary

Caution: As mentioned above, all information shall be furnished for the hall year ended 30th September and 31st March in every financial year for each ISIN (International Securities Identification Number) separately. Therefore, every public company has to obtain ISIN for each types of existing security. As per section 2(81) of the Companies Act, 2013, “securities” means the securities as defined in clause (h) of Section 2 of the Securities Contracts (Regulations) Act, 1956.

It is also pertinent to note that there is no penalty prescribed under Rule 9A Companies (Prospectus and Allotment of Securities) Rules, 2014 for non-compliance, therefore section 450 of the Companies Act, 2013 (punishment where no specific penalty or punishment is provided) will be applicable.

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Form PAS-6 and Moratorium Period under General Circular No. 11/ 2020 dated 24th March, 2020.

Due to the emerging financial distress faced by most companies on account of the large-scale economic distress caused by COVID 19, there is delay in filing of various forms which are provided under the Act. In view of this, Ministry of Corporate Affairs (MCA) has taken special measures under Companies Act, 2013 and Limited Liability Partnership Act, 2008 in view of the COVID -19 outbreak vide General Circular No. 11/ 2020 dated 24th March, 2020.

In order to support and enable Companies and Limited Liability Partnerships (LLPs) in India to focus on taking necessary measures to address the COVID-19 threat, including the economic disruptions caused by it, some measures have been implemented by the MCA to reduce their compliance burden and other risks. In Para I of the said Circular-

“No additional fees shall be charged for late filing during a moratorium period from 01st April to 30th September 2020, in respect of any document, return, statement etc., required to be filed in the MCA-21 Registry, irrespective of its due date, which will not only reduce the compliance burden, including financial burden of companies/ LLPs at large, but also enable long-standing non-compliant companies/ LLPs to make a ‘fresh start’. The Circulars specifying detailed requirements in this regard are being issued separately.”

In view of the special measure provided by MCA vide General Circular No. 11/ 2020 dated 24th March, 2020, a moratorium period from 1st April, 2010 to 30th September, 2020, has been provided by MCA, by which no additional fess shall be charged for late filing during the said moratorium period.

The due date of Form PAS-6, i.e. 13th September, 2020, is falling under moratorium period from 1st April, 2010 to 30th September, 2020, provided by MCA. Therefore, Companies can file Form PAS-6 till 30 September, 2020 without any additional fees for half year ended on 30.09.2019 and 31.03.2020.

Further, it is mentioned in the said circular that the Circulars specifying detailed requirements in this regard are being issued separately. In furtherance of the Ministry’s Circular No. 11/2020, dated 24th March, 2020 and in order to facilitate the companies registered in India to make a fresh start on a clean slate, MCA has decided to take certain alternatives measures for the benefits of all companies.

So, MCA came out with a detailed Scheme namely, “Companies Fresh Start Scheme, 2020 (CFSS-2020)” videCircular No. 12/2020 dated 30th March, 2020. The said CFSS-2020 automatically override moratorium period provided by General Circular No. 11/ 2020 dated 24th March, 2020.

It is pertinent to note that the MCA has uploaded a list of 76 forms (including for companies and LLPs) for which the benefit of the Scheme CFSS-2020 can be availed. Please note that Form PAS-6 is not included in the said list to avail the benefits under CFSS-2020.

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Disclaimer: Nothing contained in this document is to be construed as a legal opinion or view of either of the authors whatsoever and the content is to be used strictly for educative purposes only.

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