Condonation of Delay Scheme 2018

Ministry of Corporate Affairs (MCA) has issued circular dated 29^th December, 2017 wherein it has introduced a scheme known as “Condonation of Delay Scheme 2018.

In September, 2017 MCA had identified directors associated with companies which had not filed financial statements or annual returns for a continuous period of three financial years and such directors were disqualified and barred from accessing the online registry

After the said action by MCA, certain affected persons have filed writ petitions before High Courts seeking relief from disqualification. Hence, MCA has brought the Condonation of Delay Scheme 2018.

The Scheme shall be effective from 01.01.2018 to 31.03.2018.

Applicability:

The scheme is applicable to all defaulting companies except those whose names have been struck off or removed from the register of companies under Section 248(5) of Companies Act, 2013.

Procedure under the scheme for companies whose names have not been removed from the register of companies:

·         The DIN of the disqualified director shall be temporarily activated during the validity of the scheme.

·         The defaulting company can then file the overdue documents in the prescribed eforms by paying the statutory filing fee and additional fee as per Section 403 of the Act.

·            After filing the documents, the company shall seek condonation of delay by filing form e-CODS         2018 along with filing fee of Rs. 30,000/-

·         After 31^st March, 2018, DIN of those directors will be deactivated who are associated with companies which have not filed their overdue documents and e-CODS

For the companies whose names have been removed and which have filed applications for revival upto the date of this scheme, the DIN of the director shall be reactivated only upon NCLT order of revival subject to filing of all overdue documents by the company.

 The scheme is applicable to filing of following overdue documents:

·         Form 20B/MGT-7: -Form for filing Annual return by a company having share capital.

·         Form 21A/MGT-7: Form for filing Annual return by a company not having share capital.

·         Form 23AC, 23ACA, 23AC-XBRL, 23ACA-XBRL, AOC-4, AOC-4 CFS, AOC-4 XBRL, AOC-4 (non-XBRL)

·         Form 66: Submission of compliance certificate with Registrar of Companies.

·         Form 23B/ADT-1: Appointment of Auditor

After the filing of documents, Registrar can withdraw the pending prosecutions, if any. However, the scheme is without prejudice to action under Section 167(2) of the Act or civil and criminal liabilities, if any, of such disqualified directors during the period they remained disqualified.

After the expiry of the scheme, Registrar shall take necessary actions against the companies who have not availed the scheme and have not filed the overdue documents.