The tenure of Company Law Committee has been extended by the Ministry of Corporate Affairs (MCA...
The Ministry of Corporate Affairs provided various extensions and relaxations in fee for filing of forms owing to the Covid-19 situation. The relaxation and extension will provide the companies and LLPs to complete their annual compliances for Financial Year 2020-21 under the Companies Act 2013 and the LLP Act of 2008, respectively. The Ministry of Corporate Affairs decided to grant extensions and relaxed the fees for filing forms due to the representations received by various stakeholders. The stakeholders requested for extensions and fees relaxations for filing forms due to the impact of the Covid-19 pandemic. Thus in this article, we shall discuss the topic- “MCA grants extension and relaxations in certain compliances” in detail.
The MCA granted relaxations and extensions in the following compliances:
Time Extension for Holding Annual General Meeting (AGM)
The MCA issued an office memorandum asking the state ROCs to provide an extension of 2 months for holding AGM by companies. Therefore, all the state ROCs passed the order of time extension for holding AGM for the financial year ending March 31, 2021.
As per the order, an extension of 2 months to conduct the Annual General Meeting by the companies which were not able to hold such meeting within 6 months of the end of the financial year. Therefore the companies that didn’t hold AGM within September 30, 2021 for Financial Year 2020-21 can now conduct their AGM within November 30, 2021.
According to the provisions of Section 96 of the Companies Act, 2013, every company apart from the One Person Company in each calendar year is required to hold a General Meeting as its Annual General Meeting. Every company is required to hold its first AGM in 9 months from the date of closing of the first FY of the Company and thereafter in each year within 6 months from the closure of the FY, such that the time gap would not be more than 15 months between two successive AGMs.
Section 96 provides that the subsequent AGM must be held on the earliest of the following dates:
Further, the state ROCs has also stated that the companies are not required to file Form GNL-1 for seeking 2 months extension for conducting AGM. The companies whose GNL-1 applications are pending and rejected may also hold their AGM within November 30, 2021, without paying penalty.
Date Extension for filing Cost Audit Report
Cost auditors are required to prepare and submit cost audit reports for the financial year ending March 31, 2021 to the companies by September 30, 2021. Earlier the MCA had asked the cost auditor to submit this report for Financial Year 2020-21 to the Company’s Board of Directors by October 31, 2021. However, the MCA grants another extension on the date for filing of cost audit reports by a month. Therefore the cost auditors can now submit the cost audit report to the companies by November 30, 2021. Hence, companies need to file the report in Form CRA-4 to the Registrar of Company in 30 days of the receipt of the report.
Relaxation in additional fees for filing of Form 8
The MCA relaxed the payment of additional fees for filing Form 8 by the LLPs. The LLPs need to file the statement of account and solvency for FY 2020-21 within October 30, 2021. The LLPs can now file the statement of account and solvency within December 30, 2021, without paying any additional fees.
Relaxation in payment of additional fee for filing of Form AOC-4 and MGT-7
The MCA notified about providing relaxation in additional fees for filing annual financial statements for FY- 2020-21 by companies. Therefore with this relaxation in fees, companies can file form AOC-4, AOC-4 (CFS), AOC-4 XBRL, AOC-4 Non-XBRL and MGT-7/MGT-7A for the FY ending on March 31, 2021 till December 31, 2021 without the requirement of paying any additional fees.
These extensions and relaxations in compliances granted by MCA will allow companies to get some extra time to complete their compliances. Companies had faced difficulties to meet their compliances within the deadline due to the Covid-19 situation. The relaxation in the requirement of paying additional fees for filing financial forms by the companies and LLPs would allow them to file forms by December 31, 2021 by paying regular fees.