The MCA has now introduced the Condonation of
Delay Scheme to provide an opportunity for disqualified Directors to regularise compliance under the
scheme by filing overdue documents with additional fee under E Forms with MCA.
Features of the COD Scheme, 2018
All companies registered in India are required
to file annual return with the Ministry of Corporate Affairs each year and
under the Companies Act, 2013, Directors of Companies which have defaulted in
filing annual return continuously for a period of 3 years are liable to be
disqualified and a disqualified Director would be unable to incorporate a new company or act as Director of an existing
company for a period of three years.
The Directors associated with defaulting
companies i.e the companies that failed to file financial statements or annual
returns for a continuous period of three financial years 2013-14 to 2015-16 are
disqualified by MCA and name of such companies are being struck off by MCA.
Ministry of Corporate Affairs has now
introduced the Condonation of Delay Scheme to provide an opportunity for
defaulting companies and Directors to who were disqualified to revive their
names and regularise the compliance defaults from 01.01.2018 till 31st March,
2018.
Condonation of Delay Scheme,2018
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During
this period, the DIN of disqualified directors will be re-activated temporarily
to facilitate Directors of defaulting companies to file all overdue annual
returns.
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After the
end of the scheme which is open for three months, if the Director of a
defaulting company failed to regularise compliance and revive their names, DIN of
such directors associated with defaulting companies will be deactivated and such
directors would be disqualified for a period of 5 years.
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The
defaulting Companies will be able to file the overdue documents i.e Annual
Returns and Financial Statements in respective E Forms with additional fee with
MCA.
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In
addition to the overdue documents, the company has to file under the Scheme a form
e-CODS 2018 along with a fee of Rs.30,000 before 31st March, 2018.
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On
filing the overdue annual return and financial statements and form e-CODS 2018,
the DINs of the disqualified Directors would be reactivated.
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The Directors
associated with such defaulting companies if fail to file the overdue documents and E- COD
form with additional fee and penalty till the end of such scheme their disqualification will be made final for
a period of 5 years and other penalties as prescribed under Companies Act 1956
and/or Companies Act, 2013 would apply.
Summary of Circular by MCA for Condonation of
Delay Scheme 2018
The companies registered with ROC / MCA are 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.
The Companies Act, 2013 effective 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, with a view to giving an opportunity
for the non-compliant, defaulting companies to rectify the default, 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. ‘overdue documents’ means the
financial statements or the annual returns or other associated documents, as
applicable, in the case of a defaulting company.
3.“Defaulting company” means a company which
has not filed its financial statements or annual return as required under the
Companies Act, 1956 or Companies Act, 2013,
4.Applicability: – This scheme is applicable to all
defaulting companies (other than the companies which have been stuck off/whose
names have been removed 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 till 30.06.2017 in accordance with the provisions of this
Scheme.
5. 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,-
- The
DINs of the disqualified directors de-activated at present shall be temporarily
activated during the validity of the scheme to enable them to file the overdue
document.
- The defaulting company shall file the
overdue documents in the respectively 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
documen
- The defaulting company after filing
documents under this scheme, shall seek condonation of delay by filing form
e-CODS 2018 attached to this scheme along with a fee of 30,000/- (Rs. Thirty
Thousand only) as prescribed under the Companies (Registration Offices and Fee)
Rules, 2014 well before the last date of the scheme.
- 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.
- 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.
6. 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 20B/MGT-7- Form for filing
Annual Return by a 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 23B/ADT-1- Form for intimation for
Appointment of Auditors.
7. The Registrar concerned shall withdraw the
prosecution(s) pending if any before the concerned Court(s) for all documents
filed under the scheme..
8. 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.
