FAQS ON CONDONATION
OF DELAY SCHEME-2018:
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LIST OF
FAQS WITH ANSWERS
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1.
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What is Condonation of Delay Scheme 2018 [CODS 2018][1]?
Condonation
of Delay Scheme 2018 is a Scheme introduced by Central Government as an
golden 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. It is to be operational from January 1 to
March 31, 2018, scheme to be complied within 3 months
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2.
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Why this scheme?
The
Condonation of Delay Scheme, which is rolled out by the Ministry of Corporate
Affairs, is came as a
relief for disqualified directors, and giving chance to them to do
good and be a compliance compliant.
As per MCA
September 2017, Around 3,09,614 Directors were recently disqualified u/s
164(2) by the Ministry of Corporate Affairs for continuing default in filing
company annual return, which as a result vacation of office u/s 167 of the
Act, 2013 was attracted consequently.
Aggrieved
by the disqualification many disqualified Directors had made representations
to the Ministry of Corporate Affairs and approached the National Company Law
Tribunal and High Courts for staying order of disqualification. Taking into
consideration the representations made by various stakeholders, the Central
Government and Ministry of Corporate Affairs has now introduced the
Condonation of Delay Scheme to provide a final opportunity for defaulting
companies and Directors to regularize compliance before 31st March, 2018.
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3.
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To whom this Scheme is Applicable?
All companies registered in India
including private limited company, one person company, limited company,
section 8 company and others are required to file annual return with the
Ministry of Corporate Affairs each year.
Therefore, this Scheme applies to every Company
(herein referred as ‘Defaulting Company), which has not filed its financial statements
or annual returns as required under the Companies Act 1956/ Companies Act
2013, for a period of 3 years.
Please note: This scheme applies to only “Defaulting Company”
whose status is still ACTIVE on MCA Portal.
It means directors (disqualified
directors) of defaulting Company which are still active on MCA Portal have
chance to remove their disqualification.
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4.
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Will this scheme apply to Companies whose status is
shown “Strike OFF” on MCA portal?
NO, this
scheme will not apply to defaulting companies whose names have been removed
from the register of companies under section 248 of the Act
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5.
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Disqualification of directors of Companies which have
been struck off can be removed?
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.
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6.
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What is procedure to Comply with this scheme?
Deactivated
DIN of Defaulting directors will be activated for temporary purpose only.
Defaulting
Company will file “overdue
documents:”
Where overdue documents can be referred
here in as:
ü Financial Statements (Form 23AC, 23ACA,
23AC-XBRL, 23ACA-XBRL, AOC-4, AOC-4(CFS), AOC (XBRL) and AOC-4(non-XBRL)
ü Annual Return (Form Number 20B/MGT-7)
ü Compliance Certificate[2]
(Form No 66)
ü Auditor Appointment (Form 23B/ADT-1)
ü Or any other associated documents as
required under the Companies Act 1956/ Companies Act 2013
Please
note overdue documents up to June 30, 2017, can be filed under this
scheme.
The
defaulting company shall file the overdue documents in the respective
prescribed e-Forms 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.
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 Rs. 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.
(PLEASE NOTE: E-FORM CODS
2018, will be available form 20.02.2018 or other alternate date as may be
prescribed by MCA)
Where o
Company have been restored after an application to NCLT, DIN of Directors of
such companies will also be re-activated. |
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7.
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Implication of compliance under this scheme?
The
Registrar concerned shall withdraw the prosecution(s) pending if any before
the concerned Court(s) for all documents filed under the scheme.
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. |
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8.
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Implication of Non Compliance of this 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.
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9.
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Specific disclosure required in E FORM CODS 2018?
Disclosure
like:
Whether
any appeal(s) was filed against any notice issued or complaint filed before
the competent court for violation of the provisions under the Act in respect
of the above mentioned document(s). lf yes, attach proof of withdrawal of
such appeal.
Whether
any prosecution(s) is pending in court against the company and its officers
in respect of belated documents filed under the scheme. lf yes, provide
details thereof as an attachment
Whether
any director(s) of the company is declared as proclaimed offender or facing
criminal case(s) for economic offences. lf yes, provide details of such
director(s) as an attachment. Etc. |
******************
DISCLAIMER: The entire contents of this document have
been developed on the basis of relevant information and are purely the views of
the authors. Though the authors have made utmost efforts to provide authentic
information however, the authors expressly disclaim all or any liability to any
person who has read this document, or otherwise, in respect of anything, and of
consequences of anything done, or omitted to be done by any such person in
reliance upon the contents of this document. READER SHOULD SEEK
APPROPRIATE COUNSEL FOR YOUR OWN SITUATION. AUTHOR SHALL NOT BE HELD LIABLE FOR
ANY OF THE CONSEQUENCES DIRECTLY OR INDIRECTLY.
(Author-CS
Anjali Gorsia, Company Secretary from Nagpur (Maharashtra) and can
be contacted at csanjali.gorsia@gmail.com)
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