Important Relaxations in Compliances by MCA Amid COVID Pandemic

[Manish Gupta]

We all know how hard this COVID pandemic hit us physically, mentally and financially as well. We had to lock ourselves in our houses to reduce its impact as we were left with no other better option. The government imposed a lockdown also due to which it was not possible for us all to abide by the compliances timely and some relaxations were urgently needed to reduce the stress we all were facing due to the constant pressure in our minds to comply with all the laws.

Amid this COVID pandemic and lockdown situation, many requests were received by the MINISTRY OF CORPORATE AFFAIRS. Given the difficulties faced by its stakeholders, the MCA provided certain temporary relaxations to decrease the burden of mandatory compliances by the companies and LLPs in this hour of crisis.

In this article, we have discussed these relaxations and other updates to help you understand them better and stay updated with the recent reliefs provided-

• EXPENDITURE ON COVID CARE FACILITIES- ELIGIBLE CSR ACTIVITY

MCA has clarified that spending CSR funds for setting up makeshift hospitals and temporary COVID care facilities is an eligible CSR activity related to health care promotion, including preventive health care and disaster management.

It is further clarified that spending of CSR funds for

1. creating of health infrastructure for COVID Care,

2. establishment of medical oxygen generation and storage plants,

3. manufacturing and supply of oxygen concentrators, ventilators, cylinders and other medical equipment or similar activities are also eligible CSR activities.

The companies can undertake these activities in collaboration with other companies also.

• WAIVER OF ADDITIONAL FEES ON LATE FILING OF CERTAIN FORMS

MCA has decided to give relaxation on the levy of additional fees in the filing of some forms under the Companies Act, 2013 LLP Act, 2008 after considering the difficulties faced by the stakeholders due to the COVID pandemic.

This relaxation is given for forms that were due for filing from 1st of April 2021 to 31st of May 2021 (except for CHG-1 FORM, CHG-4 FORM, CHG-9 FORM)

LIST OF FORMS

1. Form ADT-1: Information to the registrar by a company for appointment of auditor

2. Form INC-22: Notice of situation or change of situation of the registered office of the company

3. Form NDH-3: the return of Nidhi company for the half-year ended

4. Form FC-4: annual return of a foreign company

5. Form MSC-3: the return of dormant companies

6. Form INC-27: conversion of public company into a private company or vice versa

7. FORM NDH-2: application of extension of time

8. Form IEPF-3: statement of shares and unclaimed or unpaid dividend not transferred to the IEPF.

9. Form AOC-4: form for filing the financial statement and other documents with the registrar

10. Form AOC-4 NBFC: form for filing the financial statement and other documents with the registrar for NBFCs

11. Form AOC-4 XBRL: form for filing XBRL document in respect of financial statement and other documents with the registrar

12. Form MGT-7: form for filing annual return by a company

13. LLP Form 3: information about LLP agreement and changes, if any, made therein

14. LLP Form-11: the annual return of LLP

15. Form DIR-11: notice of resignation of a director to the registrar

16. Form MGT-14: filing of resolutions and agreements to the registrar.

17. Form INC-20A: declaration for commencement of business

18. Form MGT-15: form for filing report on AGM

19. Form PAS-6: reconciliation of share capital audit report (half-yearly)

20. Form AOC-4 CFS NBFC: form for filing consolidated financial statements and other documents with the Registrar for NBFCs

21. Form AOC-4 CFS: form for filing consolidated financial statements and other documents with the Registrar

No additional fees for delayed filings shall be levied on these forms until the 31st of July, 2021.

• MCA has also given temporary relaxation in the filing of forms CHG-1(application for registration or creation of charge, other than debentures) and CHG-9(application for registration of creation or modification of charge for debentures)

• EXTENSION IN THE GAP BETWEEN TWO BOARD MEETING

The gap between the two board meetings for the first two quarters of the financial year 2021-22, i.e., April to June 2021 and July to September 2021, has been extended from 120 days (as required by section 173 of the Companies Act, 2013) to 180 days due to COVID.

• MCA HAS MADE A CLARIFICATION ON OFFSETTING THE EXCESS CSR SPENT BY THE COMPANIES FOR FY-2019-20

Because of the COVID crisis being faced all over the country, MCA appealed to the top 1000 companies (based on market capitalisation) on 30.03.2020 to contribute generously to the PM CARES FUND, and it was also mentioned that this amount could be setoff later against the CSR obligation arising in subsequent financial years.

In pursuance of the above appeal, MCA has clarified that any excess CSR amount spent by the companies on 31.03.2020 by way of contribution to the PM CARES FUND can be set off against the compulsory CSR obligation for FY 2020-21 but subject to the following conditions-

The excess amount spent is other than the unspent CSR amount for the previous financial years if any,

A certification by the CFO and the statutory auditor of the company is also required.

The details of this contribution shall also be disclosed in the Annual Report for CSR and the Board's Report.

• MCA 21-VERSION 3.0

Even in this time of crisis, MCA has managed to improve itself and has launched the first phase of 3rd version of its website- MCA 21 VERSION 3.0.

It has revamped its existing website with some new functions and has changed its layout to make it more user friendly. The new MCA website takes the corporate entities, professionals and citizens of India one step ahead in the making of SELF- RELIANT INDIA. Some of those changes are

1. The homepage of the website is designed in a manner to make access to MCA services more convenient.

2. The homepage also provides for the option of changing theme (light/dark), size of the font and languages also (English/Hindi). These features are added to make working on the website more comfortable and less eye-straining.

3. MCA Service Cards are also introduced, and these cards provide easy access to various MCA services. These cards provide access to various MCA services related to the life cycle of the company/LLP from start to closure.

4. The Frequently Used Services section is also there to make easy and quick access to the services used by the users frequently.

5. The logo of MCA is now linked to the homepage, so when a user clicks on the logo, it brings them to the MCA's portal.

6. Important Messages Band feature has been introduced for urgent notifications, news, messages or updates of MCA.

Authored by CA Manish Gupta and assisted by Khushi Khandelwal

For any queries contact: info@manishanilgupta.com