The Ministry of Corporate Affairs (MCA) has extended the Fresh Start Business Plan, 2020 until December 31, 2020 due to the COVID-19 pandemic.
The MCA also extended the LLP Liquidation Plan, 2020 until December 31, 2020.
The Ministry of Corporate Affairs had introduced a new scheme known as the Business New Start Program, 2020, valid from 04/01/2020 to 09/30/2020 to allow companies to comply with their previous breaches. This plan has been extended until December 31, 2020.
The Fresh Start program and modified LLP Settlement Scheme incentivize compliance and reduce the burden of compliance during the unprecedented public health situation caused by COVID-19. The USP of both schemes is a one-time exemption from additional filing fees for delayed filings of companies or LLPs with the Registrar of Companies during the currency of the Schemes, that is, during the period beginning April 1, 2020 and ends September 30. 2020.
The Schemes, in addition to granting longer time frames for companies to comply with various filing requirements under the 2013 Companies Act and the 2008 LLP Act, significantly reduce the related financial burden on them, especially for those in default. long-standing, thus giving them an opportunity to make a “fresh start.” Both Schemes also contain provisions to grant immunity from criminal proceedings, including against the imposition of penalties for late filings, and also provide additional time to file appeals to interested Regional Directors against the imposition of penalties, if they have already been imposed.
Under the scheme, the company in default means a company defined under the Companies Act 2013 and that has been in default in filing any of the documents, declarations, statements, etc., including the annual legal documents in the MCA registration 21.
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