Mar 24, 2020

Further reliefs under the Companies Act, 2013 and LLP Act, 2008

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In order to support and enable Companies and Limited Liability Partnerships (LLPs) in India to focus on taking necessary measures to address the COVID-19 threat, including the economic disruptions caused by it, the following measures have been implemented by the MCA to reduce their compliance burden and other risks: –

1.No additional feesNo additional fees shall be charged for late filing during the moratorium period from 01st April to 30th September, in respect of any document, return, statement etc.,  required to be filed in the MCA-21 Registry, irrespective of its due date, which will not only reduce the compliance burden, including financial burden of companies/ LLPs at large, but also enable long-standing non-compliant companies/ LLPs to make a ‘fresh start’.
2.Holding of Board meetingThe mandatory requirement of holding Board meetings within the intervals of 120 days stands extended by a period of 60 days till next two quarters i.e., till 30th September, 2020.
3.Implementation of CARO, 2020The Companies (Auditor’s Report) Order, 2020 shall be made applicable from the financial year 2020-2021 instead of being applicable from the financial year 2019-2020 notified earlier.
4.Independent directors meetingIndependent Directors (lDs) are required to hold at least one meeting without the attendance of Non-independent directors and members of management. For the financial year 2019-20, if the IDs of a company have not been able to hold such a meeting, the same shall not be viewed as a violation. The lDs, however, may share their views amongst themselves through telephone or e-mail or any other mode of communication, if they deem it to be necessary.
5.Deposit repayment reserve accountRequirement to create the deposit repayment reserve of 20% of deposits maturing during the financial year 2020-21 before 30th April, 2020 shall be allowed to be complied with till 30th June 2020.
6.Debentures repayment reserve accountRequirement to invest or deposit at least 15% of amount of debentures maturing in specified methods of investments or deposits before 30th April 2020, may be complied with till 30th June 2020.
7.Commencement of business by newly incorporated companiesNewly incorporated companies are required to file a declaration for Commencement of Business within 180 days of incorporation. An additional period of 180 more davs is allowed for this compliance.
8.Requirement of resident directorNon-compliance of minimum residency in India for a period of at least 182 days by at least one director of every company shall not be treated as a non-compliance for the financial year 2019-20.

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