What is CFSS 2020?
Company Fresh Start Scheme commonly known as CFSS is introduced by the Ministry of Corporate Affairs(MCA) for the purpose of helping companies to correct or make changes on any default in filing.
The MCA issued circular dated March 30, 2020, in order to give an opportunity to the defaulting companies and to enable them to file the delayed documents in the MCA-21 registry and introduced a new scheme namely “ Companies Fresh Start Scheme, 2020 (CFSS- 2020). Only normal fees for filing of documents will be payable under this scheme.
Also, this scheme is similar to the LLP Settlement Scheme, 2020 where the same one time opportunity is provided to complete the overdue compliances without any penalty.
How to apply for CFSS-2020?
When the companies are registered and established under the laws of India they are required to file MCA Annual Return every year along with financial statements. If a company fails to do so then the penalty of Rs.200 per day is to be paid.
Here, Onfiling helps in maintaining the compliance for your company at a very nominal cost.
Highlights of the CFSS- 2020
The scheme shall come into force on 1.04.2020 and remain in force till 30.09.2020.
The scheme is applicable only for the defaulting company and hence permitted to file belated documents that were due for filing.
Every defaulting company shall be required to pay normal fees as prescribed under the Companies (Registration Offices and Fees) Rules,2014 on the date of filing of each belated document and no additional fee shall be payable.
- Withdrawal of appeal in case of prosecution
If the defaulting company has filed an appeal against any notice issued or complaint filed before a competent court in respect of which application is made under this scheme, then the applicant shall before filing an application, withdraw the appeal and furnish proof of such withdrawal along with the application.
- Application for issue of immunity in respect of documents filed
The application for seeking immunity in respect of belated documents filed under this scheme may be made electronically in the Form CFSS-2020 after the closure of the scheme and after the documents are taken on the file, or on record or approved by the Designated authority as the case may be but not after the expiry of six months from the date of closure of the scheme.
And this is not applicable in case any appeal pending before the court of law and in case of management disputes of the company pending before any court of law or tribunal.
Scheme not to apply in certain cases:
1. To companies against which action for final notice for striking off the name u/s 248 of the Companies Act has already initiated by the Designated Authority
2. Where an application has already been filed by the companies for the action of striking off the name of the company.
3. To companies which have amalgamated under a scheme of arrangement or compromise
4. Where applications have already been filed for obtaining Dormant Status under section 455 of Companies Act.
5. To vanishing companies
6. Where an increase in authorized capital is involved (Form SH-7) and also charge related documents (CHG-1, CHG-4, CHG8, and CHG-9)
7. Also, the strict action shall be taken under the Act against the companies who have not availed this Scheme and are in default in filing these documents in a timely manner.