In this article, I’ve tried to capture the various relaxations provided by the Government of India, in order to enable the businesses to cope up with the COVID-19 lockdown and help them in complying with the provisions of law, within the prescribed time frame.
Subsequent to the announcement made by Union Finance & Corporate Affairs Minister, Nirmala Sitharaman on March 24, 2020, the MCA has issued a circular dated March 24, 2020, wherein several important relief measures, have been taken to address the threat imposed by COVID-19 and to reduce the compliance burden as mentioned below:
1. The interval period for holding Board Meetings under Section 173 of the Companies Act, 2013 has been extended to 180 days until next two quarters, i.e. till September 30, 2020. Therefore, the gap between two consecutive Board Meetings may now extend up to 180 days (instead of 120 days) till the next two quarters.
2. Companies (Auditor’s Report) Order, 2020 shall now be made applicable from the FY 2020-21 instead of being applicable from the FY 2019-20.
3. If the Independent Directors fail to hold even 1 meeting without the non Independent Directors in the year 2019-20, then the same shall not be considered as a non-compliance.
4. Additional time period of 6 months has been granted to newly incorporated companies to file a declaration for commencement of business, in addition to the existing period of 6 months
5. For the financial year 2019-20, non-compliance of minimum residency in India for a period of at least 182 days by at least one director of every company, shall not be treated as a violation.
6. The transactions restricted to be transacted through video conferencing (VC) or audio-visual means (AUVM), as per Rule 4, shall now be allowed till 30th June, 2020, even if the physical quorum is absent.
7. The place of BM shall be the place mentioned in the notice of the BM (sent through e-mail)
8. The Chairman and the Company Secretary of the Company shall be responsible for holding the BM via electronic means.
9. A company can only hold Extra-ordinary General Meetings via VC AUVM, and not the AGM. Provided, that EOGM shall not be held electronically, unless the matter to be discussed in very urgent.
10. Both ordinary as well as the Special Resolutions can be passed in the GM held through VC. But it should be noted that GM shall not discuss the ordinary businesses , it shall only discuss the Special businesses (considering the significance of those matters)
11. As per Section 117(1) of the Act, Company shall file required resolutions or agreement with RoC in form MGT-14 within 30 days from the date of passing of resolution or date of entering into agreement. This time period is now extended to 60 days.
12. All the forms falling due within Apr 2020 and Sep 2020, can now be filed till 30th Sep, 2020, without any additional fees.
13. MCA introduced a new web-based Form named CAR (Company Affirmation of Readiness towards COVID-19), as a recommendary measure to inform MCA about which and how many companies have adopted the “Work from Home” policy in the times of this pandemic, to be filed by Companies and LLP till 31st March, 2020.
With this, I conclude the major relevant relaxations, which will indeed save us from being a non-compliant person in the eyes of law.
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