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Over 1.7 million pending forms filed by 500,000 firms under MCA’s amnesty scheme

Over 1.7 million pending compliance-related forms have been filed on-line by about 500,000 firms and 100,000 restricted legal responsibility partnership (LLP) firms that availed the prolonged deadline to make good their pending filing-related defaults until December 31, two authorities officers mentioned.

The one-time amnesty initiative—Companies Fresh Start Scheme (CFSS) and the LLP Settlement Scheme (LSS)—with none further payment of the ministry of company affairs (MCA), which was launched in March, 2020, was concluded on December 31, 2020, the officers mentioned, requesting anonymity.

The scheme was initially efficient from April 1, 2020 for six months. Later, the federal government prolonged it for an additional three months due to disruptions attributable to Covid-19 pandemic, they mentioned. CFSS and LSS gave a one-time rest to such enterprise entities that defaulted in submitting statutory paperwork up to now. The authorities offered companies a recent begin as totally compliant entities however the length of defaults.

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It is feasible that some enterprise entities could not have submitted all pending statutory necessities comparable to appointment of administrators, appointment of auditors, annual returns, annual stability sheet, compliance certificates and modifications in shareholding place of promoters and high ten shareholders. They can nonetheless meet the salutatory obligations by paying some further payment, one of many officers mentioned.

“The initial deadline to avail the schemes was September 2020, which was extended to December 31, 2020 to provide relief to businesses because of the Covid-19 pandemic. As per the notification, the scheme is no longer available,” the officers mentioned.

Some firms nonetheless need the federal government to increase the deadline by one other three months. Some petitions have additionally been obtained for extending the deadlines additional, however no choice has been taken on that, a second official mentioned.

The Institute of Company Secretaries of India (ICSI) on December 24, wrote to the ministry of company affairs to increase the deadline from December 31, 2020 to March 31, 2021. But, the deadline was not prolonged. HT reviewed the letter. Email queries despatched to MCA and ICSI didn’t elicit any response.

The first official quoted above mentioned, “Those who could not comply in the nine-month period are unlikely to do so in another three months. Sincere firms have no reasons to worry as they can still file by paying some additional fee.”

One Delhi-based chartered account mentioned, requesting anonymity, that the schemes gave firms a recent begin with out further prices. “No extension means huge additional costs to such companies, which could go up to 10 times of the normal fees. Some entities also faced problems in online filing because of connectivity issues and technical problems at the MCA-end,” he mentioned.

The authorities official talked about above mentioned the web submitting system is totally faceless and technically strong. “There is no excuse of technical glitches in the online filing. The system is functioning well. The robustness of the system can be assessed by the fact that over 160,000 forms were filed on December 31 alone,” the second official mentioned.

Ankit Singhi, head, company regulation, at a authorized and company advisory agency, Corporate Professionals Group, mentioned, “It was indeed a very good scheme and with these numbers [1.7 million online filings], it seems, that it has been successful. Some companies could not have availed the scheme within the deadline as in the last couple of years, filing compliances have drastically increased. They are mainly small companies with limited resources, infrastructure and lack of advisory services. So they are seeking an extension.”

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