Companies Fresh Start Scheme, 2020 is a RELIEF.

Have your Company defaulted in filing statutory returns and other documents and you wish to file but could not do so because of the very high late fee?


Well, now you can file them without paying a late fee/additional fee because MCA came up with a Scheme for the Defaulting Companies.  

Purpose of the Scheme

The government observed that several companies defaulted in the filing of Statutory Returns and were not able to file momentarily due to heavy late fees, as it may cause a financial burden on the entity. On this ground, many representations were received by the government, seeking a waiver of fee/Con-donation of Delay/relaxation in Additional Fee. This is another step of Government inline to its efforts while promoting ease of doing business, under which ONE-TIME RELAXATION IN ADDITIONAL FEE/ONE-TIME CON-DONATION OF DELAY IN FILLING STATUTORILY REQUIRED DOCUMENTS WITH REGISTRAR is provided to the defaulter Companies through which they can make their default good. 

Important Dates 

· 30th March 2020 – Scheme published on MCA Website
· 01st April 2020 – Scheme came into force
· 30th September 2020 – Conclusion of the Scheme.

Waiver of Late Fee under the Scheme

Earlier it was mandatory to pay ₹100/- (One Hundred Rupees) per document/per form, per day of delay but according to the scheme, Companies which will opt to complete their Statutory Filings under this Scheme will have to pay Normal Filing Fee only. No additional/Late Fee will be required to be paid.

Applicability of the Scheme

The Scheme is applicable on any document, statement, return, etc. required to be filed on the MCA-21 Registry including annual statutory documents.

Non-applicability of the Scheme

Following Companies cannot avail benefit under the Scheme:
· Companies against which action for final notice u/s 248 of the Act has been initiated.
· Application has been filed by the Company for Striking off the name.
· Companies which have amalgamated under a scheme of Compromise and Arrangement.
· Application has been filed to obtain the Dormant Status under section 455.
· Vanishing Companies
· Cases involving an increase in Authorized capital and charge related documents.

Immunity over Prosecution

Companies who make their default good under this scheme till 30th September 2020 shall not be subjected to prosecution by the Registrar.

Companies who make their default good under this scheme shall not be subjected to prosecution by the Registrar.

However, any Company which has not filed its statutory returns earlier and doesn't opt for this Scheme shall be liable for action by the Registrar.
The Companies who opted the Scheme have to apply for an Immunity Certificate by filling Form CFSS-2020 within 6 months from the date of closure of the Scheme, without payment of any fee. Based on the declaration made in Form CFSS-2020, an Immunity Certificate in respect of documents filed under the Scheme be issued by the Designated Authority.

The scheme also provides an opportunity to companies who wish to take Dormant Status or Strike-off its name. Companies who wish to strike-off due to non-operation and did not see any future business prospects may also opt this scheme to complete their pending statutory fillings before filling the application of Strike-off.

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