All about about CFSS 2020

Last Updated On: May 21, 2020, 8 p.m.
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COMPANY FRESH START SCHEME -2020

The Ministry of Corporate Affairs in the view of COVID-19 has provided an opportunity to Corporates by issuing a general circular No.12/2020 dated on 30th March 2020. MCA has introduced a scheme to all defaulting companies CFSS-2020 this scheme helps those companies to make a fresh start to clean slate by filing all e-forms without any additional fees between 1st April to 30th September 2020. Defaulting company means any company has made default in filing any document, any statement, any return.

Need/Purpose:

The main purpose of this scheme is an intent to reduce the compliance burden on companies by making a fresh start by clearing all the non –compliances on account of non-filings made by the company registered in India.

Benefits:

 MCA giving one time opportunity to all defaulting companies to complete all their pending compliances by filing necessary documents in the MCA-21 without being subjected to any additional fees.

 It provides immunity from paying additional fees and being liable to any prosecution or proceedings for the penalty imposed

 Companies have to pay normal fees as per the provision of section 403 with the companies (Registration office and fees) rule, 2014, and section 460 of the CA, 2013.

 

Procedure:

​​​​​​​ The company needs to have active status before availing of the scheme.

​​​​​​​ Companies are required to file form CFSS-2020 without any filing fees within six months.

​​​​​​​ The form CFSS gives the details of CIN (Corporate Identification Number) Name of the company and its registered office address, e-mail of the company, and forms filed with SRN to be given.

​​​​​​​ For filing form CFSS-2020 the below two documents are mandatory to be attached:

(i) Proof of withdrawal of APPEAL

(ii) Details in prosecution pending

​​​​​​​ For Non-Compliant Companies, first the status has to be changed to Active.

​​​​​​​ Pre-requisite is that form INC-22 for Active tagging and DIR 3 KYC for DIN activation of Directors of the company.

​​​​​​​ If the company has delayed in filing form INC-28 with RD, then the company has to get the order from RD and then need to file form INC-28

 

List of 60 Forms allowed to be filed of Companies Act, 2013 under CFSS -2020:(Check the link at the end of this article)

 

Consequences if no action taken by the defaulting Companies:

The respective ROCs having jurisdiction over the companies shall take the necessary actions pursuant to the respective provisions of the Act, 2013 in respect of all those companies which continue to be in default of filing the documents and have not availed CFSS-2020. 

In case the forms due and pending for filing are not filed within the currency of the Scheme, such forms will be subject to additional fees, penalty, prosecution as applicable pursuant to the provisions of the Companies Act, 2013.

 

FAQs:

1.      Who can avail this scheme?

Ans:  Any company which has failed to file any mandatory forms with Registrar of Corporate.

2.      Can MGT-14 filed in this scheme?

Ans:  Yes, MGT-14 can be filed in this scheme only if its filing due date does not exceed 300days. If it exceeds 300 days then the company has to apply for condonation of delay.

3.      Is this scheme applicable to Inactive companies?

Ans:  Yes, either by applying Voluntary strike-off by filing e-form STK-2 or by applying for the status of Dormant company by filing e-form MSC-1.          

4.      Can deactivated director get activated through this scheme?

Ans:  Yes, the deactivated director should file DIR-3 KYC e-form and INC-22A without any payment of fee provided such director is will be considered as not disqualified under section 164 of the CA 2013.

5.      What are the forms which cannot be filed under CFSS-2020?

Ans:  Forms like SH-7, CHG-1, CHG-4, CHG 8/CHG 9 cannot be filed under this scheme.

6.      What if certain companies have got the order for belated filing of returns?

Ans:  In such cases, if the penalties are imposed then the same may not be refunded 

7.      Who will issue an Immunity Certificate?

Ans:  An Immunity Certificate with respect to documents filed under this scheme shall be issued by the Designated Authority.

8.      Is this scheme applicable to LLPs?

Ans:  No, MCA has provided another scheme that is the LLP Settlement scheme.

9.      For filing MGT-14, AOC-4 for the past year, is it required to apply for condonation?

Ans: Condonation is required if MGT-14 filing is beyond 300 days. Whereas, for AOC-4 past years can be filed without any condonation.

10.      Is the CFSS-2020 scheme applicable to a subsidiary of a foreign company registered in India.

Ans:   Yes.

11.    Under this scheme whether AoC-4 for a year can be filed, without filling the AOC-4 for the previous year?

Ans:  Yes, It can be filed without filing for the previous year. There is no restriction, it is expected that complete and continuous year filing will be good corporate governance.

12.     The company is an inactive company. The company has defaulted in filing form SH-7. It now wants to file form SH-7 under CFSS 2020 scheme and simultaneously make an application for striking off the name by filing Form STK 2.

Ans:   SH-7 can be filed with applicable MCA fee and an additional late fee. The additional fee waiver is not applicable for SH-7.

13.    What are options available to a company the name of which has been struck off by the ROC but is having business activities for availing this scheme

Ans: The Company has to approach NCLT and get an Order for reviving. Thereafter the company can take the benefit under CFSS. 30.

14.    Whether the scheme is applicable for companies already struck off by MCA and not voluntarily filed by the company?

Ans: The struck off companies may approach the NCLT for revival. Once the company is revived the belated documents may be filed.

15.    Whether late fees/additional fees be waived off after filing of Immunity Form i.e. full amount will be paid in advance (while filing of any form out of 76 forms) and refunded back after filing of Immunity Form?

Ans: Additional fees would not be charged in respect of the 76 forms and such forms have already been displayed in the MCA-21 portal.

16.    Is the Form CFSS 2020 currently available in the MCA portal for e-filing? If not, when will the form be made available?

Ans: The form CFSS 2020 would be made available from 1st October 2020 and till 31st March 2021 for the filing process.

 

Click here to check Detailed FAQs on CFSS 2020 and LLP Modified Settlement Scheme

Click here to see List of forms CFSS 2020 and LLP Modified Settlement Scheme​​​​​​​

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