New Condonation of Delay Scheme for Restored Companies by MCA

The Ministry of Corporate Affairs (MCA), on 30.03.2020, introduced the Companies Fresh Start Scheme, 2020 (CFSS 2020). This scheme was in effect from 01.04.2020 till 30.09.2020. On account of the large disruptions caused by COVID-19, there was a further extension of this scheme till 31.12.2020. Many professionals made representations to the MCA seeking further extension of CFSS 2020. But, the MCA did not extend this scheme.

The MCA issued a circular on 15.01.2021 stating that the CFSS 2020 is inapplicable for various filings done under the Companies Act 2013 after 31.12.2020. But, the MCA gave relief to the companies restored in December 2020 by introducing a new scheme. The MCA introduced the ‘Scheme for condonation of delay for companies restored on the Register of Companies between 1st December 2020 and 31st December 2020 under Section 252 of the Companies Act, 2013’ through its circular dated 15.01.2021.

Many representations were given to the MCA to grant relief to the companies who had filed an appeal under the Companies Act Section 252 before the National Company Law Tribunal (NCLT). Many companies filed an appeal for restoration against the order of striking off their company names under section 252 of the Companies Act.

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The NCLT passed orders of restoration of the company names relating to these appeals in December. As a result, these companies could not avail the benefits of the CFSS 2020. Thus, the MCA introduced this new condonation of delay scheme for condoning the delay in filing forms to the Registrar of Companies.

This new condonation of delay scheme for restored companies introduced by the MCA applies to specific companies. It applies to only those companies whose names have been restored in December through the order of restoration by the NCLT. This scheme is valid from 01.02.2021 to 31.03.2021. These companies can file documents to the registrar without paying any additional fees.

The companies who come under this new condonation of delay scheme can file all e-forms except where there is an increase in authorized capital, i.e. e-Form SH-7, and charge related documents, i.e., e-forms CHG-1, CHG-4, CHG-8, and CHG-9 on the MCA portal. Under this scheme, the companies will have to pay the regular filing fees under the Companies (Registration Offices and Fees) Rules 2014 while filing the e-forms.

Accordingly, the MCA website has made available the CFSS 2020 forms for filing as e-forms for the companies covered under this new scheme. Though there was no extension of the CFSS 2020, the MCA gave relief provided in the CFSS 2020 to the companies restored in December by introducing this new scheme. Thus, the companies restored between 01.12.2020 and 31.12.2020 can file documents without facing any penalty.

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