Given the ongoing crisis (COVID 19), the Ministry of Corporate Affairs has decided to extend the Company Fresh Start scheme and LLP Settlement Scheme till 31/12/2020. Companies Fresh Start Scheme aims to facilitate a framework for the companies to settle their previous default. The scheme has now extended by the MCA till December 31st, 2020.
Company Fresh Start Scheme and LLP Settlement Scheme
The Company Fresh Start Scheme and LLP Settlement Scheme were rolled by the government to reduce the previous compliance issues during the unprecedented health crisis created by the Coronavirus Pandemic.
The main highlight of the said schemes is a one-time relaxation of supplementary filing fees for delayed filing by partnership firms or organizations with ROC during the timeline starting from 01/04/2020 till 30/09/2020.
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Salient features of the Company fresh start scheme
- Allowing firms to file pending statements/documents/return on the online portal of the Ministry of Corporate Affairs[1], regardless of the default period.
- The default can be associated with the non-filing of statements/documents/returns on the MCA portal.
- The company fresh start scheme encompasses 66 types of Forms/Documents against which filing can be executed as per the scheme
- The default can be associated with the Companies Act, 2013
- Only a basic fee will be applicable and no other expenses will be levied, hence it will provide relaxations to all the companies having long-standing default.
- The scheme also confers the right to taxpayers to raise objections against the imposition of a penalty for non-filing.
- After filing the company fresh start scheme Form, ROC will confirm the issuance of the Immunity certificate to averts any penalized provisions.
Key Notes on Filing Requirement with Ease
Apart from providing relaxation for late filing, the scheme helps the organization to get rid of the financial pressure amid the crisis. As the name suggests, the Fresh start scheme is an initiative by the government that assist the companies, particularly with long-standing default to confront filing requirement with ease.
Both the scheme also enclose provisions for penal proceedings against the imposition of penalties concerning late submissions and also renders extra time for filing appeals before the regional directors against the penalties imposed by the concerned authority.
In a legal perception, the defaulting company is the one registered under Companies Act 2013 which has failed to file a return, statements, or documents on the MCA 21 registry.
Conclusion
The extension for the timeline for the said scheme will allow the company to settle its long-standing default without being penalized by the authority. Since the ongoing crisis has made it hard for the companies to cope up with filing requirements, the said scheme will boost their confidence and let them outranks the obstacle with ease.
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