INDIA and COMPANIES : ‘’COMPANIES FRESH START SCHEME 2020’’

INTRODUCTION

In view of the Covid-19 pandemic and in order to provide companies with a unique opportunity, India's Ministry of Corporate Affairs (MCA) unveiled on March 30, 2020, a new plan called Companies Fresh Start Scheme 2020 (CFSS-2020) concerning delays in the submission of corporate forms and to authorize any default in registrations, regardless of duration, so as to create a true “fresh start” as a fully compliant entity.

IMPORTANT POINTS OF THE ‘’FRESH START SCHEME 2020’’

The new regulations went into effect on April 1 and will remain in effect until September 30, 2020.

The Fresh Start Scheme guarantees immunity to companies with respect to the filing of additional fees and from prosecution or proceedings for any delays associated with the late filing of documents. It also ensures the reduction of compliance During this unprecedented period caused by COVID-19.

Companies may file all outstanding payments, statements or documents with the Registrar of Companies (RoC) at no additional cost, regardless of the due date. That is, each delinquent company must pay the normal prescribed fees of each form submitted late but no additional fees will be due.

This immunity will not be granted for subsequent violations of the law. This means that the benefit under this scheme can be used for defaults by Companies pre-existing as of March 31, 2020 but does not provide immunity for defaults arising thereafter, i.e., from April 1, 2020 onward.

HOW TO TAKE ADVANTAGE OF THE BENEFITS UNDER THIS SCHEME:

Application for immunity under the CFSS-2020 scheme can be submitted electronically by filling out the appropriate form (e-Form CFSS-2020). Accordingly, the scheme requires companies by default to clear all outstanding documents until September 30, 2020.

Next, companies must submit the electronic form CFSS-2020 Within 6 months after the end of the Plan CFSS-2020, then by March 31, 2021. The competent body, upon filing, will issue a ‘’Certificate of Immunity’’ for the filed documents. However, immunity under CFSS-2020 does not apply to some specific cases.

NON-APPLICABILITY OF THE SCHEME

The CFSS-2020 scheme Is not applicable in the following cases:

To increase the authorized share capital and all related expense forms.

For companies that have applied for deletion from the commercial register.

For companies that have applied for “dormant company” status. It will be allowed for any dormant company to continue to remain on the Ministry's register (MCA) if minimum compliance requirements are maintained.

For companies against which a dissolution action has been initiated.

For companies that have merged through a scheme of arrangement or compromise under the law.

For “ghost” companies.

IMPORTANT NOTE:
Upon the conclusion of the CFSS-2020 plan, the relevant authorities will take the necessary actions in accordance with the respective legal provisions against all those companies that continue to be in default of submitting documents, and have not availed themselves of the extraordinary scheme of the CFSS-2020 plan.

As a reminder, the Octagona Task Force as Knowledge Partner of the Indian Embassy is available to provide free support, detailed information and advice to all Italian companies that may need it.

In this regard you can contact :

Alexander Fichera | [email protected] | +39.328.2123458
Monica Sessi | [email protected] | +39.340.3422473
Brando Bruschi | [email protected] | +39.348.9653664