New scheme to promote ease of doing Business – Companies Fresh Start Scheme 2020

Under the Companies Act 2013, every company is required to file various forms, statements and returns with the Registrar of Companies (ROC). Failure to do so attracts an additional fee of up to 12 times the normal fee and makes directors liable for prosecution.

To ease this financial burden and promote ease of doing business during the current COVID-19 crisis, the Ministry of Corporate Affairs (MCA) has introduced the new Companies Fresh Start Scheme, 2020, which allows a one-time condonation of delay in filing required statutory documents with the ROC without payment of any additional fees.

Key features of the scheme

Applicability of scheme

• Under the scheme, available from 1 April to 30 September 2020, any defaulting company is permitted to file delayed forms (i.e., annual return, financial statements and various other forms) without payment of any additional fee for the delay.

Immunity against penalty for delays in filings

• The defaulting company/directors will not be liable for any prosecution/penalty for delay in filing of such forms.

Provision of additional time

• An additional time of 120 days from the last date of filing appeal against the order of adjudicating authorities (if the last date falls between 1 March 2020 to 31 May 2020) for filing appeal has been granted.

and more…