SECTION 460. CONDONATION OF DELAY IN CERTAIN CASES
[Effective from 12th September, 2013]
Notwithstanding anything contained in this Act,—
(a) where any application required to be made to the Central Government under any provision of this Act in respect of any matter is not made within the time specified therein, that Government may, for reasons to be recorded in writing, condone the delay; and
(b) where any document required to be filed with the Registrar under any provision of this Act is not filed within the time specified therein, the Central Government may, for reasons to be recorded in writing, condone the delay.
Company Law Settlement Scheme, 2014
General Circular No. 34/2014 dated 12-8-2014
As you are aware, the Companies Act requires companies to file annual documents (Annual Return and financial statements) on the MCA21 electronic registry within prescribe time limit. Sections 159, 220 and 611 of the companies Act, 1956 may be referred to in this regard. These annual documents are considered very important in context of an up-to-date Registry, It is observed that a large percentage of companies have not filed their statutory documents making them liable for penalties and prosecution for such non-compliance.
2. The Companies Act, 2013 lays down a stricter regime for the defaulting companies with higher additional fees. The quantum of punishment has been enhanced under the above mentioned provision of the Act vis-à-vis the earlier Act i.e. Companies Act, 1956, A specific provision for enhanced fine in case of repeated default has also been included in the form of section 451 of the act, Additionally, the provisions of section 164(2) of the Act, inter alia, providing for disqualification of directors in case a company has not filed financial statements or annual returns for ant continuous period of three financial year has been extended to all companies
3. The Ministry has received representations from various stakeholders requesting for grant of transitional period/one time opportunity to enable them to file their pending annual documents to avoid attraction of higher fees/fine and other penal action, especially disqualification of their Directors prescribed under the new provisions of the Act.
4. In order to give such an opportunity to the defaulting companies to enable them to make their default good by filing these belated documents, the Central Government in exercise of powers conferred under section 403 and 460 of the Companies Act, 2013 has decided to introduce a Scheme namely “Company Law Settlement Scheme 2014” [ClSS-2014] condoning the delay in filing the above mentioned documents with the Registrar, granting immunity for prosecution and charging a reduced additional fee of 25% of the actual additional fees payable as per section 403 read with Companies (Registration Offices and Fee ) Rules, 2014 for filing those belated documents under the Companies Act, 1956/2013 and the Rules made thereunder.
5. In addition, the scheme gives an opportunity to Inactive companies to get their companies declared as ‘dormant company* under section 455 of the Act (Chapter XXIX) by filing a simple application at reduced fees. The said provision enables Inactive companies to remain on the Register of Companies with minimal compliance requirements.
6. The details of the Scheme are as under: –
(i) The scheme shall come into force on the 15th August 2014 and shall remain in force up to 15th October, 2014.
(ii) Definitions – In this Scheme, unless the context otherwise requires, –
(a) “Act” means the Companies Act, 2013 and Companies Act, 1956 (where ever applicable) ;
(b) “Company” means a company as defined in clause of 20 of section 2 of the Companies Act, 2013;
(c) “defaulting company” means a company defined under the Companies Act, 2013, and which has made a default in filing of annual statutory documents.
(d) “designated authority” means the Registrar of Companies having jurisdiction over the registered office of the company.
(e) “immunity certificate” means the certificate referred to in sub-paragraph (vl> of the Scheme;
(f) “inactive Company” means as defined In Explanation (i) to sub-section (1} of section 455(1) of Companies Act, 2013.
(iii) Applicability: – Any “defaulting company” is permitted to file belated documents which were due for filing till 30th June 2014 In accordance with the provisions of this Scheme:
(iv) Manner of payment of fees and additional fee on filing belated document for seeking Immunity under the Scheme – The defaulting company shall pay statutory filing fees as prescribed under the Companies (Registration Offices and fee} Rules, 2014 along with additional fees of 25% of the actual additional fee payable on the date of filing of each belated document.
(v) Withdrawal of appeal against prosecution launched for the offences: If the defaulting company has filed any appeal against any notice issued or complaint filed before the competent court for violation of the provisions under the Companies Act, 1956 and/or Companies Act, 2013 in respect of which application is made under this scheme, the applicant shall before filing an application for issue of immunity certificate, withdraw the appeal and furnish proof of such withdrawal along with the application.
(vi) Application for Issue of Immunity in respect of document(s) filed under the Scheme – The application for seeking immunity in respect of belated documents filed under the Scheme may be made electronically in the e-Form CLSS-2014 annexed, after the document(s) are taken on file, or on record or approved by the Registrar of Companies as the case may be. The e-Form for filing application to obtain such a certificate will be available on the MCA21 portal from 1st September, 2014 and may be filed thereafter but not later than three months from the date of closure of the Scheme. There shall not be any fee payable on this Form.
Provided that this immunity shall not be applicable in the matter of any appeal pending before the court of law and in case of management disputes of the company pending before the court of law or tribunal.
(vii) Order by designated authority granting immunity from penalty and prosecution – The designated authority shall consider the application and upon being satisfied shall grant the immunity certificate in respect of documents filed under this Scheme.
(viii) Scheme not to apply in certain cases – (a) This scheme shall not apply to the filing of belated documents other than the following:
Form 20B – Form for filing annual return by a company having share capital.
Form 21A – Particulars of Annual return for the company not having share capital.
Form 23AC, 23ACA, 23AC-XBRL and 23ACA-XBRL – Forms for filing Balance Sheet and Profit & Loss account.
Form 66 – Form for submission of Compliance Certificate with the Registrar.
Form 23B – Form for intimation for Appointment of Auditors.
(ix) This Scheme shall not apply to companies against which action for striking off the name under sub¬section (5) of section 560 of Companies Act, 1956 has already been initiated by the Registrar of Companies or where any application has already been filed by the companies for action of striking off name from the Register of Companies or where applications have been filed for obtaining Dormant Status under section 455 of the Companies Act, 2013; to vanishing companies
(x) After granting the immunity, the Registrar concerned shall withdraw the prosecution(s) pending if any before the concerned Court(s);
(xi) scheme for Inactive Companies: The defacing inactive companies, while filing due documents under CLSS-2014 can, simultaneously, either:
(a) apply to get themselves declared as Dormant Company under section 455 of the Companies Act, 2013 by filing e-form MSC- l at 25% of the fee for the said form; OR
(b) apply for striking off the name of the company by Wing e- Form FTE at 25% of the fee payable on form FTE.
(xii) Applicability of clause (a) sub-section (2) of Companies Act. 2013 In case of companies availing the Scheme:- In case of defaulting companies which avail of this Scheme and file all belated documents, the provisions of clause (a) of sub¬section (2) of section 164 of the Companies Act, 2013 shall apply only for the prospective defaults, if any, by such companies.
7. At the conclusion of the Scheme, the Registrar shall take necessary action under the Companies Act, 1956/ 2013 against the companies who have not availed this Scheme and are in default in filing these documents in a timely manner.
Company Law Settlement Scheme, 2014 (CLSS-2014)
General Circular No. 40/2014 dated 15-10-2014
In continuation to the Ministry’s General Circular No. 34/2014 dated 12.08.2014 on the subject cited above, this Ministry has, on consideration of requests received from various stakeholders, has decided to extend the Company Law Settlement Scheme (CLSS 2014) upto 15th November, 2014.
Company Law Settlement Scheme, 2014 (CLSS-2014)
General Circular No. 44/2014 dated 14-11-2014
In continuation to the Ministry’s General Circular No. 34/2014 dated 12.08.2014 and 40/2014 dated 15/10/2014 on the subject cited above, this Ministry has, on consideration of requests received from various stakeholders, has decided to extend the Company Law Settlement Scheme (CLSS 2014) upto 31st December, 2014.
Condonation of Delay Scheme, 2018
General Circular No. 16/2017 dated 29th December, 2017
Whereas, companies registered under the Companies Act, 2013 (or its predecessor Act) are inter-alia required to file their Annual Financial statements and Annual Returns with the Registrar of Companies and non-filing of such reports is an offence under the said Act.
Whereas, section 164(2) of the Act read with section 167 of the Companies Act,2013 [the Act], which provisions were commenced with effect from 01.04.2014, provide for disqualification of a director on account of default by a company in filing an annual return or a financial statement for a continuous period of three years.
Whereas, Rule 14 of the Companies (Appointment and Qualification of Directors) Rules, 2014 further prescribes that every director shall inform to the company concerned about his disqualification, if any, under section 164(2), in form DIR-8.
Whereas, consequent upon notification of provisions of section 164(2), Ministry of Corporate Affairs (MCA) had launched a Company Law Settlement Scheme 2014 providing an opportunity to the defaulting companies to clear their defaults within the time period specified therein and following the due process as notified.
Whereas, MCA in September 2017, identified 3,09,614 directors associated with the companies that had failed to file financial statements or annual returns in the MCA21 online registry for a continuous period of three financial years 2013-14 to 2015-16 in terms of provisions of section 1.64(2) r /w 167(1)(a) of the Act and they were barred from accessing the online registry and a list of such directors was published on the website of MCA.
Whereas, as a result of above action, there have been a spate of representations from industry, defaulting companies and their directors seeking an opportunity for the defaulting companies to become compliant and normalize operations.
Whereas, certain affected persons have also filed writ petitions before various High Courts seeking relief from the disqualification.
Whereas, with a view to giving an opportunity for the non-compliant, defaulting companies to rectify the default, in exercise of its powers conferred under sections 403, 459 and 460 of the Companies Act, 2013, the Central Government has decided to introduce a Scheme namely “Condonation of Delay Scheme 2018″ [CODS-2018] as follows.
1.The scheme shall come into force with effect from 01.01.2018 and shall remain in force up to 31.03.2018
2.Definitions – In this scheme, unless the context otherwise requires, –
i.“Act” means the Companies Act,2013 and Companies Act, 1956 (where ever applicable);
ii. ‘overdue documents’ means the financial statements or the annual returns or other associated documents, as applicable, in the case of a defaulting company and refer to documents mentioned in paragraph 5 of the scheme.
iii. “Company” means a company as defined in clause of 20 of section 2 of the Companies Act, 2013;
iv. “Defaulting company// means a company which has not filed its financial statements or annual returns as required under the Companies Act, 1956 or Companies Act, 2013, as the case may be, and the Rules rnade thereunder for a continuous period of three years.
v. “Designated authority” means the Registrar of Companies having jurisdiction over the registered office of the company.
3.Applicability: – This scheme is applicable to all defaulting companies (other than the companies which have been stuck off/ whose names have been removal from the register of companies under section 248(5) of the Act). A defaulting company is permitted to file its overdue documents which were due for filing till30.06.2017 in accordance with the provisions of this Scheme.
4.Procedure to be followed for the purposes of the scheme:- (1) In the case of defaulting companies whose names have not been removed from register of companies,-
i.The DINs of the concerned disqualified directors de-activated at present, shall be temporarily activated during the validity of the scheme to enable them to file the overdue documents.
ii. The defaulting company shall file the overdue documents in the respective prescribed eForms paying the statutory filing fee and additional fee payable as per section 403 of the Act read with Companies (Registration Offices and fee) Rules, 2014 for filing these overdue documents.
iii. The defaulting company after filing documents under this scheme, shall seek condonation of delay by filing form e-CODS attached to this scheme online on the MCA21 portal. The fee for filing application eform CODS is Rs.30,000/- (Rs. Thirty Thousand only).
iv. The DINs of the Directors associated with the defaulting companies that have not filed their overdue documents and the eform CODS, and these are not taken on record in the MCA21 registry and are still found to be disqualified on the conclusion of the scheme in terms of section 164(2)(a) r/w 167(1)(a) of the Act shall be liable to be deactivated on expiry of the scheme period.
v. In the event of defaulting companies whose names have been removed from the register of companies under section 248 of the Act and which have filed applications for revival under section 252 of the Act up to the date of this scheme, the Director’s DIN shall be re-activated only NCLT order of revival subject to the company having filing of all overdue documents.
5.Scheme not to apply for certain documents – This scheme shall not apply to the filing of documents other than the following overdue documents:
i) Form Number 208/MGT-7- Form for filing company having share capital.
ii) Form 21A/MGT-7- Particulars of Annual return for the company not having share capital.
iii) Form 23AC, 23ACA, 23AC-XBRL, 23ACA-XBRL, AOC-4, AOC-4(CFS), AOC (XBRL) and AOC- 4(non-XBRL) – Forms for filing Balance Sheet/Financial Statement and profit and loss account.
iv) Form 66 – Form for submission of Compliance Certificate with the Registrar.
v) Form 238/ADT-1- Form for intimation for Appointment of Auditors.
6.The Registrar concerned shall withdraw the prosecution(s) pending if any before the concerned Court(s) for all documents filed under the scheme. However, this 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.
7.At the conclusion of the Scheme, the Registrar shall take all necessary actions under the Companies Act, 1956 / 2013 against the companies who have not availed themselves of this Scheme and continue to be in default in filing the overdue documents.
8.The e-Form CODS 2018 would be available from 20.02.2018 or an alternate date, which will be intimated by the ministry on www.mca.gov.in. The stakeholder should complete the necessary procedural requirements and file overdue documents without waiting for the availability of the e-CODS form.
Condonation of Delay Scheme, 2018
General Circular No. 02/2018 dated 28th March, 2018
In continuation to the Ministry’s General Circular No. 16/ 2017 dated 29/12/2017 on the subject cited above, this Ministry has, on consideration of requests received from various stakeholders, has decided to extend the Condonation of Delay Scheme, 2018 upto 30th April, 2018.
Condonation of Delay Scheme, 2018
General Circular No. 03/2018 dated 27th April 2018
In continuation to the Ministry’s General Circular No. 16/2017 dated 29/12/2017 and General Circular No. 02/2018 dated 28.03.2018 on the subject cited above and to state that the closing date of the scheme viz. 30.04.2018 is falling under gazetted holiday on account of ‘Budh Purnima’, therefore, this Ministry has decided to give one day extension of the said scheme i.e. up to 01.05.2018.
Clarification-Condonation of Delay Scheme, 2018
General Circular No. 05/2018 dated 17th May 2018
In continuation of General Circular No. 16/2017 dated 29.12.2017, General Circular No. 02/2018 date 28.03.2018 and General Circular No. 03/2018 dated 27.04.2018 on the subject cited above, it is stated that this Ministry has received representations from stakeholders raising doubts regarding filing requirements of e-CODS, 2018, in such cases, where petitions have already been filed before NCLT under section 252 of the Companies Act 2013, during the currency of the scheme and orders are pending before the NCLT and whether such struck off companies can file CODS upon obtaining orders for the same even after 01.05.2018.
2. The matter has been examined and it is clarified that as per para 4(v) of the General Circular No.16/2017 dt 29.12.2017, which states “In the event of defaulting companies whose names have been removed from the register of companies under section 248 of the Act and which have filed applications for revival under section 252 of the Act up to the date of this scheme, the Director’s DIN shall be re-activated only NCLT order of revival subject to the company having filing of all overdue documents”. It, is therefore, hereby directed that in such cases the Registrar(s) of Companies shall raise a ticket through Change Requirement Form (CRF) on MCA21 portal along with copy of NCLT order and E-governance shall activate DIN of the directors of such struck off companies that have been revived through NCLT to file e-CODS, 2018. However, the directors whose DINs are proposed to be activated through CRF should not be directors on any other company which has been stuck off under section 248( 1) of the Act (other than the one revived through NCLT order as mentioned in CRF). This may be ensured by the ROC before raising CRF with E-governance.
3. Further, the Registrar(s) of Companies are directed to ensure that CRFs are raised in such cases only, after thorough scrutiny of the NCLT orders and ensuring that such struck off companies had filed overdue documents before filing e-CODS, 2018 and had filed petitions before the CL T during the validity of COOS Scheme.