OBJECTIVE In order to make a fresh start on a clean state, Ministry of Corporate Affairs (MCA) vide circulars issued in March, 2020 has taken certain alleviative measures by introducing the Companies Fresh Start Scheme, 2020. Further, to promote ease of doing business, MCA has given relaxation in additional fees with respect to filing of pending documents with MCA by defaulting LLPs by introducing LLP Settlement Scheme, 2020. These Schemes act as relief to defaulting Companies / LLPs by mitigating their financial burden and giving them an opportunity to make a fresh start. In this webinar, we shall understand the salient features of these Schemes including their objective, applicability and the effect of immunity.

1. CS Meenakshi Jayaraman
What are the salient features of CFSS, 2020
& LLP Settlement Scheme, 2020?

2. Credits and Acknowledgments
Sundar Rajan S
2

3. Presentation Schema
3
Overview
Part-I: Companies Fresh
Start Scheme, 2020
Part-II: LLP Settlement
Scheme, 2020

4. Overview
4

5. 5
In order to address the COVID-19 threat and to reduce the compliance burden,
MCA vide its Circulars dated 30th March, 2020 has introduced Companies Fresh
Start Scheme, 2020 and Limited Liability Partnership (LLP) Settlement Scheme,
2020
These Schemes provide one-time opportunity for defaulting Companies / LLPs
to complete the delayed filings, comply with various filing requirements and
make a fresh start

6. Part – I: Companies Fresh Start Scheme, 2020
6

7. Presentation Schema for Part-I
7
Understanding the
Company Fresh Start
Scheme
Applicability and time
period of the Scheme
Benefits available under
the Scheme
Immunity Certificate
Benefits to inactive
Companies
Illustrations

8. Legends used in Part-I of the Presentation
Act Companies Act, 2013
CFSS / The Scheme Companies Fresh Start Scheme, 2020
MCA Ministry of Corporate Affairs
Old Act Companies Act, 1956
Registrar / ROC Registrar of Companies
Sec Section

9. What is Companies Fresh Start Scheme, 2020 (CFSS)?
9
In the wake of COVID-19, MCA has introduced CFSS to facilitate the Companies registered in
India to make a fresh start on a clean slate
The Scheme provides one-time opportunity to companies by enabling them to complete their
pending compliances with MCA without paying additional fees
The main objectives of the Scheme are to:
•Reduce compliance burden during the unprecedented public health situation caused by
COVID-19 and
•Incentivise compliance by providing an opportunity to defaulting companies to make a
fresh start
The Scheme also gives an opportunity to defaulting inactive companies to get their companies
declared as “Dormant Company” by filing e-form MSC-1 at a normal fee

10. Whether the Scheme is applicable for all companies
registered with MCA?
10
Companies against which final notice for striking off the name of the company under Sec 248 of the Act has
already issued by the ROCs
Companies which have already made an application for striking off the name of the company in Form STK-2
Companies amalgamated under the scheme of compromise or arrangement under the Act
Companies which have already applied for dormant status under Sec 455 of the Act before the
commencement of the Scheme and *Vanishing Companies*
Filing of Form SH-7 (increasing Authorised Capital), CHG-1, CHG-4, CHG-8 and CHG-9 (Charge related
documents)
No. The Scheme is not applicable in certain cases which are listed as follows:
*Vanishing Company means a company:
 registered under the Act / Old Act / any other law for the time being in force and listed with Stock Exchange
 which has failed to file its returns with the ROC and Stock Exchange for a consecutive period of 2 years and
 is not maintaining its registered office at the address notified with the ROC or Stock Exchange and none of its
directors are traceable

11. What is the meaning of Defaulting Company?
11
It means a Company
defined under the Act
which has made a default
in filing of any
documents, statements,
returns, etc.
including annual
statutory documents
on the MCA registry
What is the time period of the Scheme?
The Scheme commences on 1st April, 2020 and ends on 30th September, 2020

12. 12
What are the benefits available under the Scheme?
1. Waiver of additional filing fees in respect of e-Forms (other than those specifically
excluded) by condoning the delay in filing during the duration of the Scheme
2. Immunity from launching of prosecution or proceedings for imposing penalty on
account of delay associated with certain filings
Grant of immunity certificate and its effects
 Immunity certificate is issued by ROC having jurisdiction over the registered office of
the Company
 Companies having this certificate get immunity from:
a. prosecutions pending, if any, before the concerned Courts and
b. proceedings of adjudication of penalties under Sec 454 of the Act

13. How can a defaulting Company get the immunity certificate?
13
An application in Form CFSS – 2020 shall be filed after the closure of the Scheme and after
the documents are taken on record or approved by the Registrar
However, such Form shall not be filed after the expiry of 6 months from the date of
closure of the Scheme (i.e.) Form shall not be filed after 31st March, 2021
There is no fee applicable in filing Form CFSS – 2020
On perusal of the Form CFSS – 2020, the Registrar shall issue the immunity certificate in
respect of documents filed under the Scheme

14. 14
Whether the defaulting Company can get immunity
against any prosecution?
Immunity shall not be provided in the following two instances:
1. In case of any appeal or management dispute of the Company pending before any
court of law or Tribunal
However, if the pending
appeal pertains to order
issued for violation of
provisions of the Act or the
Old Act with respect to
default in statutory filings,
then the company
may be granted
immunity if the
pending appeal is
withdrawn before
filing Form CFSS –
2020
and the proof of
withdrawal of appeal
shall be filed along
with such Form

15. Contd.
15
2. In case of conviction order received from any Court in any matter or an order imposing
penalty received from adjudicating authority for which no appeal is preferred before the
commencement of the Scheme
 However, if the last date of filing appeal is between 1st March 2020 and 31st May 2020, a
period of additional 120 days from such last date is allowed to file the appeal
 During the additional period as mentioned above, no prosecution shall be initiated
against the Companies with respect to default in statutory filings in MCA-21 registry

16. How does the Scheme benefit inactive Companies?
16
The defaulting inactive companies while filing belated documents under the Scheme, can
simultaneously apply for either of the following:
a. Application for dormant status by filing Form MSC-1 at a nominal fee; or
b. Application for strike-off of name of the company in Form STK-2 by paying
the normal fee of Rs. 10,000

17. 17
What if the defaulting Companies don’t avail
the Scheme?
At the conclusion of the Scheme
(i.e. after 30th September, 2020),
the Registrar shall take
necessary action under the Act
against the Companies
which have not availed the
Scheme
and are in default in filing
any document as required
under the Act or the Old
Act in a timely manner

18. 18
Illustrations
SSR Limited has not filed its annual returns (Form AOC-4 and MGT-7) till date for three Financial Years
ended 31-03-2017, 31-03-2018 and 31-03-2019. The Company’s status is still active and has not been
struck off. Whether SSR Limited can avail the Scheme and file its pending returns with normal fee?Q.
A.
Yes. The Scheme is applicable for all Forms except Form SH-7 and charge related forms irrespective of the
due date. Hence, SSR Limited can avail the Scheme and file its pending annual returns with normal fee.
MN Limited (formed by merger of M Limited and N Limited during the year 2015) has overdue returns of
PAS-3, ADT-1 and SH-7. Whether MN Limited can avail the Scheme and file all its pending PAS-3 and ADT-
1 returns with normal fee?Q.
A.
No. The Scheme is not applicable for Companies which have amalgamated under a scheme of
arrangement under the Act. Hence, the Scheme does not apply to MN Limited. Company shall file all the
pending returns with late filing fees as applicable.

19. Contd.
19
ABC Private Limited is an ACTIVE Non-Compliant Company. Whether it can avail the Scheme and file Form
INC-22A with no fee?Q.
A.
Yes. As per the update released by MCA dated 31st March, 2020, Form INC-22A shall be filed by ABC
Private Limited with no fee during the time period of the Scheme
XYZ Private Limited has made an appeal for order received from adjudicating authority to pay penalty for
violation of Sec 42 of the Act (failure to allot shares within 60 days of receipt of money). The Company
has then withdrawn the appeal and wanted to claim immunity by availing the Scheme. Whether the
Company can do so?
Q.
A.
No. Immunity is applicable only for default in statutory filings under the Act or the Old Act. In this case,
the adjudicating order is issued for violation of provisions of the Act which is not related to default in filing

20. Part - II: Limited Liability Partnership (LLP)
Settlement Scheme, 2020
20

21. 21
Legends used in Part-II of the Presentation
Act Limited Liability Partnership Act, 2008
FY Financial Year
LLP Limited Liability Partnership
MCA Ministry of Corporate Affairs
Registrar Registrar of Companies
Rule(s) Limited Liability Partnership Rules, 2009
The Scheme LLP Settlement Scheme, 2020

22. Presentation Schema for Part-II
22
Understanding the LLP
Settlement Scheme
Applicability of the
Scheme
Time period of the
Scheme
Benefits available under
the Scheme
Non-applicability of the
Scheme
Illustrations

23. 23
LLP is a form of business entity which provides benefit of limited liability but allows its
members the flexibility of organising their internal structure as a partnership based on
mutually arrived agreement
Applicability of additional fee on late filing becomes a financial burden to LLPs in case of
inordinate delay which led to large number of LLPs remaining non-compliant, mainly on
account of their inability to pay late fees for the cumulative period of delay
To focus on taking necessary measures with the outbreak of COVID-19 and to support
LLPs by reducing their compliance burden
To give an opportunity to defaulting LLPs to make a fresh start, MCA has introduced LLP
Settlement Scheme (“the Scheme”) to give one-time relaxation in additional fee on
belated documents to be filed
What is LLP Settlement Scheme, 2020?

24. 24
What is the meaning of defaulting LLP?
It means a LLP
registered under the Act
which has made a default
in filing of documents on
the due date(s)
specified under the
Act and Rules made
there under
Whether the Scheme is applicable to all the forms to be
filed with MCA?
Yes. The Scheme is applicable to all the belated documents which are due for filing till
31st August, 2020 by defaulting LLP
What does belated documents mean?
It means all documents / forms which are required to be filed in MCA-21 registry under the Act and
Rules

25. 25
What is the time period of the Scheme?
 The Scheme shall come into force on 1st April, 2020 and shall remain effective till
30th September, 2020 pursuant to modification of the Scheme vide MCA circular
dated 30th March, 2020 (Original scheme was in force from 16th to 31st March,
2020)
 Hence, belated documents filed by defaulting LLP during the abovementioned
time period gets covered under the Scheme
Whether an LLP is required to file an application to the
Registrar to avail the Scheme?
No, the defaulting LLPs may themselves avail of the scheme for filing belated documents
on payment of normal fee as applicable for such document

26. 26
What are the benefits available under the Scheme?
 There are 2 main benefits available under the scheme
1. Waiver of additional fee on the belated documents
2. Immunity from prosecution in respect of belated documents filed under the Scheme
Whether the Scheme is applicable to all LLPs?
for striking off its name from the register as per the provisions of Rule 37(1) of the Rules
The Scheme shall not apply to LLPs which have made an application in Form 24 to the Registrar,
What if the defaulting LLPs don’t avail the Scheme?
On conclusion of the Scheme (i.e.
after 30th September, 2020), the
Registrar shall take necessary
action under the Act
against the defaulting LLPs
which have not availed the
Scheme
and are in default in filing
any document as required
under the Act in a timely
manner

27. Illustrations
27
S&S LLP defaulted in filing Form 11 for FY ended 31-03-2018 and 31-03-2019 and pursuant
to which it filed Form 24 for striking off the name of LLP. Now, whether S&S LLP can file
pending Form 11 for both FY under the Scheme?
Q.
A.
No. The Scheme is not applicable for LLPs which has made an application in Form 24 for
striking off the name of LLP as per the provisions of Rule 37(1)
XYZ LLP failed to file notice for change of name with Registrar in Form 5 within the due date
which is on 31st March, 2020. Whether XYZ LLP can avail the Scheme and benefit from it?Q.
A.
Yes. The Scheme is available for all belated documents which are due till 31st August, 2020.
XYZ LLP can avail the Scheme by filing the belated Form during the currency of the Scheme

28. Contd.
28
If ABC LLP gets incorporated on 11-08-2020 and fails to file Form 3 with Registrar within the
due date which is on 10-09-2020. Whether XYZ LLP can avail the Scheme and file the
belated Form on or before 30-09-2020 with normal fee?
Q.
A.
No. The Scheme is available for all belated documents which are due for filing till 31st
August, 2020. Hence, ABC LLP shall not avail the Scheme since the due date is after 31-08-
2020
SRS LLP fails to file Form 8 and Form 11 (annual filings) since incorporation i.e. from FY
ended on 31-03-2010. Whether the LLP can avail the Scheme and file the belated Forms
with normal fee?
Q.
A.
Yes. The Scheme is applicable for LLPs which has defaulted in filing any Form which are
required to be filed with MCA that are due till 31st August, 2020

29. Thank You!
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