‘Companies fresh start scheme’: ICSI requests govt to further extend deadline till March-end

The Institute of Company Secretaries of India (ICSI) has raised serious concern over the government’s decision not to extend the deadline of the ‘companies fresh start scheme’ for corporates to file pending compliance documents with the Registrar of Companies (RoC) beyond December 2020.

Many SMEs and LLPs (limited liability partnerships) are facing uncertain future as their efforts to revive themselves have become a costly affair.

In December 2019, the Ministry of Company Affairs termed many entities that did not comply with the statutory filings as shell companies and de-recognised them.

Following the industry representation, the government last March launched ‘Companies Fresh Start Scheme 2020’ and allowed companies to file the pending documents by September; this deadline was extended to December-end due to Covid outbreak.

Since then, over 500 companies have obtained requisite NCLT orders for revival which took them about four months amid the pandemic. Now, these and another 1,000-odd companies, whose pleas are pending with NCLT, have to pay heavy penalty to file their statutory papers with the RoC, said SK Jain, Senior Member, ICSI.

Some of the corporates have already moved the Rajasthan High Court against the government decision not to extend the scheme and more writ petition are being filed in Mumbai and Ahmedabad soon, said Jain.

ICSI on Monday made a representation with the RoC to extend the deadline till March-end as life in some of the major cities are yet to limp back to normalcy.

In metros like Mumbai, local trains — the life line for millions of people — are not yet fully commenced for many sections of the society. Even the guidelines for working environment of various State governments, including Maharashtra government, is restrictive right from fixing working hours, night curfews, movement of people, disruptions of transport system and much more, said Jain.

Corporates and professionals are unable to complete the pending tasks including audit could not be completed as they were mostly working from home, he said.