#Ham Honge Kamayab #We shall overcome – Together. Strangely for the first time ever, human race is in it together – not as a group but as individuals. Unfathomable. Unimaginable. Unnerving. Eerie. Sci-fi movie type. Together we stand, Divided we fall – yes, we all “stand together at a distance” to fight against COVID-19, a miniscule, dreaded virus that has brought the whole world to a standstill that has never been seen in history before ! If we are divided in our purpose and “come together” crossing the Lakshman Rekha, we are sure to fail and fall. Let’s continue to honour the “social distancing” norms even as we bridge the “emotional distancing” and help each other tide over this apocalypse. Much has been shared about the family bonds growing during this crisis, thanks to the forced lockdown and #WFH (Work From Home). Managing all on our own, we have come to realise the value of every single person who contributes in our life – maid, sweeper, driver, gardener, office peon, security, grocer, delivery boy, electrician, plumber, spouse, children, office colleagues, even the boss….the list goes on. The eternal truth that man is a gregarious being and cannot live in isolation is dawning upon all of us like never before.Each of us are interdependent on the other, irrespective of the function and status. ‘Social distancing’ is highlighting ‘interdependency’ – what an oxymoron-like situation !
I may be pardoned for talking about my Cancer days now but I am tempted to share a few life lessons from that experience where I was home-bound for months but pulled though successfully:
Positive energy from within and the universe – a crisis brings out the best in us. Let us use the positive energy within us and spread it as much as possible.
Milestone approach – When the journey is long, break it up into milestone activities.
Live for the moment – Enjoy the small things. This too shall pass.
Accept the situation and adapt – Ordinary things taken for granted become special. Sudden changes shake you up. Create a different daily routine to tackle.
Believe in yourself and your own power – both as an individual and as a society. Unleash the indomitable spirit hidden somewhere deep within. Lets fight this together !
Strategise right in the beginning – a few countries have done it. Others haven’t and we are seeing the devastating difference.
Stay calm and safe – No ‘why us’, ‘why now’ questions – we humans know how we have exploited Mother Nature and her other ‘children’. It is a sort of ‘reclaim action’. Stay calm, staysafe.
Be prepared for ‘side-kicks’ – Journey is long. Despite strategizing, be prepared for shocks and encountering ‘side-kicks’. Learn to deal with them.
Trust and delegate – most critical for WFH. Take everyone into confidence. You are not as
important as you think. Life goes on, perhaps even better without you !
Practise social media distancing – along with social distancing. Avoid fake news and fear-mongering.
Build immunity – through physical activity and mental strength. Relax and rejuvenate.
People are the greatest assets – Take care of employees, customers, vendors, friends & family.
#Let’s be ‘alone together’ ! #Hum honge kamayab !! #Oh, deep in my heart, I do believe, We shall overcome !!!
Never before, not even during Budget issues, has Samhita got so loaded in favour of regulatory updates – 20 news updates in all in Samhita 233rd issue. COVID-19 has got the various regulators viz., MCA, Finance Ministry, SEBI, IBBI, GST up and galloping, responding promptly to the need of the hour – from extending filing timelines to meeting dates to tax payments to offering a Fresh Start to Companies & LLPs to complete their pending filings at normal fee, without any additional fee or fear of prosecution and penalties. Read this carefully – the relaxation is not only for filings due during this lockdown period but also for all pending ones BC (before Corona?) ! Corporates, please take advantage and clear up pending matters. Wash all the compliance sins inexpensively, thanks to the Corona virus. More is likely to follow for India Inc. w.r.t Board and Shareholder meeting protocols, what with the Social Distancing norms not permitting physical meetings.
“Let’s Excel in English” contributed by Mr. Balaji Ramaswamy, a Cambridge CELTA certified English language trainer breaks the monotony of heavy regulatory reading and the pall of Corona gloom. Watch out for his insightful tips related to English articulated in an interesting way.
The LLP Settlement Scheme, 2020 released by MCA on 04.03.2020 has been modified to reduce compliance burden on LLPs during the pandemic. The said Scheme which was valid till 13.06.2020 now ends on 31.03.2020 and a new Settlement Scheme will be in place with following features:
The Scheme shall be effective from 01.04.2020 to 30.09.2020
Any defaulting LLP is permitted to file belated documents, which are due for filing till 31.08.2020, without any additional fee.
No prosecution shall be launched for late filing.
Companies Fresh Start Scheme, 2020
To grant companies an opportunity for a fresh start, to begin with a clean slate MCA has introduced the “Companies Fresh Start Scheme, 2020” effective from 01.04.2020 to 30.09.2020.
Any company which has defaulted in filing of any document / return at any point in time can now file the same without any additional fee and with no fear of prosecution by RoC.
All such companies shall obtain an “immunity certificate” under the scheme by making an application in Form CFSS-2020
The Scheme shall not be applicable to companies under the process of strike-off, vanishing companies, dormant companies or companies under CIRP.
Special measures for companies and LLPs
Vide Circular dated 24.03.2020, MCA has announced the following relaxations to mitigate the compliance burden of companies and LLPs.
No additional fees will be charged for late filing of documents, returns, statements etc. during the period 01.04.2020 to 30.09.2020 irrespective of the due dates.
Maximum gap of 120 days between 2 consecutive board meetings extended by 60 days for meetings in the April-September, 2020 quarters.
CARO, 2020 will be applicable from FY 2020-2021 instead of FY 2019-20
Non-holding of Independent Directors meeting (at least one in a year) without non-independent directors being present will not be treated as a violation during FY 19-20.
The deposit repayment reserve of 20% of deposits maturing during FY 2019-20 should be created before 30.06.2020 as against 30.04.2020.
The requirement to invest / deposit at least 15% of the amount of debentures maturing has to be complied with before 30.06.2020 as against 30.04.2020.
An additional period of 180 days has been granted for newly incorporated companies to file the declaration for Commencement of Business in Form INC-20A.
Non-compliance of minimum residency in India for at least 182 days by at least one director of the company will not be treated as a violation.
VC Board meetings can now be held for all agendas
The CA, 2013 lists few agendas which cannot be dealt with in VC meetings viz. approval of financial statements, approval of Board’s Report, approval of prospectus, Audit Committee meetings, approval of mergers, amalgamation, demerger, acquisition and takeover. During April-June 2020 quarter all these agendas can be dealt with through VC board meetings.
Extension of due date for Annual filing – UT of J&K and Ladakh
The due date for filing Forms AOC-4, AOC-4(CFS), AOC-4 XBRL and MGT-7 for FY ended 31.03.2019 has been extended till 30.06.2020 without payment of late fees for companies in UTs of J&K and Ladakh.
PM CARES – CSR funds for COVID-19
MCA has clarified that contribution by corporates towards battling COVID-19 will be treated as a valid CSR spend considering the mammoth funds required for the pandemic. The Prime Minister’s Citizen Assistance and Relief Emergency Situations Fund (PM CARES Fund) has been constituted for this purpose for dealing with any kind of distress or emergency. Corporates must ensure all other compliances to qualify as CSR contribution under the health care, sanitation and disaster management categories listed in Schedule VII of CA, 2013.
Company Affirmation of Readiness towards COVID-19
In the wake of COVID-19, MCA has advised all companies and LLPs to report the readiness of “work from home” facility through a simple web form called CAR (Company Affirmation of Readiness towards COVID-19) which was released on 23.03.2020. It is a voluntary OTP based reporting.
Extension of due dates – SEBI
Due to the COVID-19 pandemic, following relaxations have been granted for certain filings underSEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015:
Current due date
Extended due date
Corporate Governance report
Statement of Investor complaints
Compliance certificate on share transfer facility
Certificate from Practicing Company Secretary on timely issue of share certificates
Secretarial Compliance report
Annual Financial results
Holding of AGM by top 100 listed entities by market capitalization for FY 19-20
The requirement of maximum 120 days gap between 2 meetings (Audit Committee & Board) has been relaxed for the meetings held during the period 01.12.2019 to 30.06.2020. However they are required to hold at least 4 meetings in the year.
The Requirement of the Nomination & Remuneration Committee, Stakeholders Relationship committee & Risk Management committee to meet at least once a year i.e. before 31.03.2020 for FY 2019-20 has been extended till 30.06.2020
The new Standard Operating Procedure as per notification dated 22.01.2020 shall be effective for periods ending on or after 30.06.2020 as against the existing period ending on or after 31.03.2020.
The due date for regulatory filings for REITs & InvITs for the period ended 31.03.2020 has been extended by 1 month over the due date mentioned in the respective Rules.
The disclosure filings under SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (SAST Regulations), require the shareholders to compile and disseminate information of their consolidated shareholding as on 31.03.2020, to the company and the stock exchanges within 7 working days from the end of the financial year. The due date for filing such disclosure has been extended till 30.06.2020.
Equity shares with superior rights issued to promoter
If a company seeking listing of its ordinary shares for public issue has issued any equity shares with superior voting rights to its promoters / founders; as per the Securities Contracts (Regulation) (Amendment) Rules, 2020 the company should mandatorily list its equity shares having superior voting rights at the same recognized stock exchange along with the ordinary shares which are being offered to the public.
However the minimum offer and allotment requirements of the Regulations shall not apply to such shares with superior voting rights which have been listed on the Stock Exchange for offering its ordinary shares to the public.
Additional fee applicable from October, 2020
Late filing of Forms under IBC, will attract additional fee of Rs. 500 per month of delay from 01.10.2020. Earlier the date of implementation was 01.04.2020
IBC limit increased from 1 lakh to 1 crore
The Central Government has increased the threshold limit of default of Corporate Persons to Rs 1 crore from the existing Rs. 1 Lakh under IBC. This is a relief to several companies which would have otherwise become insolvent during these tough times.
IBC (Amendment) Act, 2020
IBC (Amendment) Act, 2020 w.e.f. 13.03.2020, has ushered in a few important changes that are summarised in a comparative table format by Ms. Sumana Rao, PCS and Insolvency Professional. The Provisions are made effective from 28.12.2019. Click on the attached article for details.
21 lockdown not to be counted in time line for any CIRP activity
During the 21 days lockdown declared by the Central Government w.e.f. 25.03.2020, time line for various activities in the CIRP like conducting meetings of Committee of Creditors, submission of Resolution Plan etc. has been relaxed by excluding the 21 days lockdown period.
Chennai gets NCLAT bench
Central Government has constituted another bench of National Company Law Appellate Tribunal [NCLAT] at Chennai to hear appeals against the orders of NCLT benches at Karnataka, Tamil Nadu, Kerala, Andhra Pradesh, Telangana, Lakshadweep and Puducherry w.e.f. 18.03.2020.
Affordable and Middle-Income Housing Investment Fund I
Central Government notifies “Special Window for Affordable and Middle-Income Housing Investment Fund I”, a Government sponsored Alternate Investment Fund for providing priority debt financing for stalled housing projects. This qualifies as “interim finance” under Section 5(2) of IBC.
Department of Revenue
Indian Stamp (Collection of Stamp-Duty through Stock Exchanges, Clearing Corporations and Depositories) (Second) (Amendment) Rules, 2020
The amendments made to the Indian Stamp Act, 1899 through the Indian Stamp (Collection of Stamp-Duty through Stock Exchanges, Clearing Corporations and Depositories) (Amendment) Rules, 2020 were effective from 01.04.2020. However the effective date now stands as 01.07.2020 as per notification dated 30.03.2020. For details of the changes in the stamp duty effected, please refer to our update in Samhita 229th issue of Feb-2020
IRP & RPs to be treated as a distinct person
Where a Resolution Professional (RP)/ Interim Resolution Professional (IRP) is appointed under the IBC, 2016, they shall be treated as distinct person of the corporate debtor and shall be liable to take new GST registration, within 30 days in all the States and Union Territories where the corporate debtor was registered earlier.
In cases where the IRP/RP has been appointed prior to the date of this notification, he shall take registration within 30 days from the commencement of this notification.
Persons receiving service from IRP/ RP are eligible for claiming input tax credit by quoting the erstwhile GSTIN (corporate debtor GSTN) subject to conditions. Any amount deposited by the IRP / RP into the cash ledger will be to the credit of the erstwhile registration.
Form GSTR-1 not required in certain cases
If return in Form No. GSTR-3B has been furnished instead of GST-CMP-08 for FY 2019-20, taxpayers shall not be required to furnish the statement of outward supply of goods or services or both in FORM GSTR-1 or the statement containing the details of payment of self-assessed tax in FORM GST CMP-08 for all the tax periods in the financial year 2019-20.
E-Invoice implementation date has been postponed to 01.10.2020 from 01.04.2020 for companies whose turnover exceeds Rs. 100 crores. As per the notification, a certain class of registered persons (insurance company, banking company, financial institution, non-banking financial institution, GTA, passenger transportation service etc.) shall be exempted from issuing e-invoices or capturing dynamic QR code.
Extension of due dates and certain relaxations – GST
Following are the extended due dates and relaxations under GST Act as announced by the Honourable Finance minister of India:
March, April and May 2020 month GST returns & composition returns filing date extended up-to 30thJune 2020.
Companies with less than 5 Crore Turnover no interest, late fees or penalty.
Other companies more than 5 Crore turnover, no Late fee and penalty, only interest at reduced rate of 9%
Date for opting composition scheme extended to 30th June 2020.
Extension of due dates and certain relaxations – Income Tax
The Honourable Finance Minister Ms. Nirmala Sitharaman announced certain relaxations and extension of due dates. Highlights of the same are below:
For FY 2018-19
Last date for filing ITR extended till 30th June 2020
Interest reduced from 12% to 9% for all tax payments made till 30th June
Reduced interest 9% for delayed deposit of TDS till 30th June
Extension of due dates:
for all notices, orders, appeals, applications, reports, any other document by taxpayers extended upto 30th June, 2020
All investments / Saving instruments for rebates can be made by 30th June 2020.
Date for linking Aadhaar – PAN extended to 30.06.2020
Vivad Se Vishwas Scheme extended up-to 30.06.2020, No additional charge of 10% up-to 30th June 2020, earlier disputed tax has to be deposit by 31st March without additional charge of 10%.
Note: The contents of this Newsletter are only a summary and has not dealt with any issue in detail. Any action taken
or proposed to be taken must be in consultation with professionals and not merely based on
the articles / news updates. S. C. Sharada & Associates disclaims all liability on action taken without professional advice.
S. C. Sharada & Associates,
Company Secretaries. #405, 7th Cross, IV Block, Koramangala, Bangalore – 560 034.
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