PDH Chamber Of Commerce And Industry requested Finance Minister, Smt. Nirmala Sitharaman to extend the time period regarding Legal and Statutory compliances in the second wave of Covid 19. Full text of their representation is as follows:-
PDH CHAMBER OF COMMERCE AND INDUSTRY
22nd April 2021
Respected Smt. Nirmala Sitharaman Ji,
Request to extend the time period regarding compliances in the second wave of Covid 19
The current COVID situation has major economic consequences across the globe and every country is being affected by it. Small businesses are vital to the economy of the nation whether there is a pandemic across India or any other country. In fact, 94 percent of the Fortune 1000 are already seeing COVID-19 disruptions.
The last financial year 2020-21 started with the whole country being under one of the strictest lockdowns, but at that time few would have thought that April 2021 would be worse in terms of Covid cases than April 2020. With cases rising continuously and rapidly the pandemic appears to be bigger threat now than it did during the first wave. States are following mini lockdown and subsequent restrictions to curb the situation. However, the same is causing difficulties for Corporates to comply with the necessary timelines which is required to be followed by them. The relaxation in timelines as was allowed during the last year is necessitated at this time as the offices are operating with limited staff and to facilitate consolidation of listed subsidiaries.
Upon careful perusal of the raised concerns from industry and stakeholders, PHDCCI hereby requests for necessary extension of timelines by at least 90 days from the due date as mentioned below especially for compliances requiring certification by external agencies. The relaxations will enable companies to avoid penalties on account of unavoidable delay in meeting their regulatory compliances.
1. The extension for filling Form MSME 1 related to supplies of good and payment shall be granted as the last date to file is 30th April, 2021
2. The extension for filling Form 11 by LLPs related to annual return be granted as the last date to file is 30th May, 2021.
3. The extension for filling Form PAS 6 to be filed by unlisted public company for reconciliation of share capital audit report shall be granted as the last date to file is 30th May, 2021
4. The relaxation in the timelines for all shareholder communications such as payment (dispatch of warrant etc) shall be granted as Registrar and Transfer Agents (RTAs) are working with limited resources.
5. Relaxation in formalities for transfer of Shares to IEPF- Reminder letters to Shareholders, advertisements required to be published under the Companies Act, like for transfer of Shares to IEPF. This is generally done in May every year.
6. The companies should be provided with the flexibility of holding a board meeting having a gap between two consecutive board meetings be extended to 180 days.
7. The requirement to hold a separate meeting of IDs once in a year be dispensed with and they shall be allowed to discuss the matters as per schedule 4 of the Companies Act, 2013 between themselves by telephone, e-mail or other agreed means of communication. Also, IDs are not involved in day to day activity hence they should not be liable for any type of criminal liability.
8. Extension for filling Form FC-4 related to Annual Return of Foreign Co. and Form CHG1/9 related to creation / modification of charges created on assets of the Company.
9. As a special measure due to outbreak of COVID-19 pandemic, the residency clause relaxed by the MCA last year i.e if a director of a Company doesn’t reside in India for more than 182 days, it shall not be considered as violation of Section 149 of Companies Act, 2013. Considering the rationale of doing business without physical presence and geographical locations, the minimum residency requirement be dispensed with.
10. The extension for filing Form DPT-3 for exempted deposits should be granted.
11. Extension for time for compliance with provisions of Section 135(6) of the Companies Act, 2013 i.e., transfer of Unspent Amount of CSR on ‘ONGOING PROJECTS’ to Unspent Corporate Social Responsibility Account, the last date of which is 30th April 2021 for FY 2020-21.
12. Timeline to submit annual financial results by listed companies within 60 days from end of financial year – Regulation 33(3)(d) of SEBI LODR
13. Compliance Certificate (Half Yearly) by 30 April – Regulation 7(3) of the LODR
14. Secretarial Compliance Report (Yearly) by 30 May – Regulation 24A of the LODR
15. Certificate from Practicing Company Secretary by 30 April – Regulation 40(9) of the LODR
16. Timeline to hold AGM by top 100 companies by market capitalization within five months from end of financial year – Regulation 44(5) of SEBI LODR
17. Financial Results (Quarterly) by May 15 – Regulation 33 of the LODR
18. Financial results of entities having listed non-convertible debentures (NCDs) / non-convertible redeemable preference shares (NCRPSs) by 15 May- Regulations 52(1) and (2) of the LODR and Filing of Reconciliation of Share Capital Audit Report with stock exchange(s) as per Regulation 76 of SEBI DP Regulation
19. Extension of time for holding Board Meeting for March’21 quarter under LODR Regulations.
20. Closely held company with no outside shareholders and no investment other than promoters, is same as Pvt. Ltd. company. Hence provision of Closely held company and Pvt. Ltd. Company should be same.
We hope our suggestions will be considered in best interests of the industry and ease of doing business provisions for Indian Corporate Sector.
With best regards,
Smt Nirmala Sitharaman
Hon’ble Minister of Finance & Corporate Affairs
Government of India