The Ministry of Corporate Affairs (MCA) has recently extended the deadline for filing Form LLP BEN-2 and LLP Form No. 4D for Limited Liability Partnerships (LLPs). Here are the details:
Background:
The MCA introduced LLP BEN-2 and LLP Form No. 4D as crucial forms for declarations under the Companies Act, 2013.
These forms relate to significant beneficial owners and beneficial interest in contributions received by the LLP.
Extension and Waiver of Additional Fees:
To facilitate compliance during the transition from MCA-21 version-2 to version-3, the MCA has extended the deadline.
LLPs now have until 1st July 2024 to submit these forms without incurring any additional fees.
This extension aims to ease the financial burden on LLPs and promote adherence to legal obligations.
Conclusion:
General Circular No.-03/2024 demonstrates the government’s commitment to supporting businesses, especially LLPs, during transitional phases.
By prioritizing ease of doing business and encouraging compliance, the MCA promotes transparency and efficiency within the corporate sector.
The Ministry of Corporate Affairs, has made it mandatory for private limited companies also to issue their securities in dematerialized form starting from 30 September 2024 and to facilitate conversion of all their existing securities in dematerialized form
Background:
Till now, only public limited companies were required to issue these securities in dematerialized form and private limited companies were exempted and hence could issue their securities in the form of a physical document.
Previously, the Ministry of Corporate Affairs (MCA) mandated that public companies must maintain and transact their shares in Demat form starting from October 2nd, 2018
Effective from October 27, 2023, the MCA has introduced significant changes in the regulations governing the dematerialization of securities for private limited companies.
The Companies (Prospectus and Allotment of Securities) Second Amendment Rules, 2023 now apply to private limited companies, excluding small companies.
These rules come into effect on September 30th, 2024.
As per the new amendment every private company which has not been classified as small company shall mandatorily convert their existing physical securities into demat form within 18 months of end of F.Y. 2023. (i.e. 30/09/2024)
Small company, as per Section 2(85) of the Companies Act,2013, means a company, other than a public company,
having a paid-up share capital of which does not exceed 4 crore rupees or such higher amount as may be prescribed; and
Turnover of which as per profit and loss account for the immediately preceding financial year does not exceed 40 crore rupees or such higher amount as may be prescribed: Exceptions:
A holding company or a subsidiary company;
A company registered under section 8; or
A company or body corporate governed by any special Act.
Consequences of non-dematerialization of physical security into demat on or before 30/09/2024:
After the due date, the company shall not be able to undertake a) Issue any securities b) buyback of securities c) issue bonus shares d) Offer for right issue of securities
After the due date, Security holders shall not be able to transfer the securities of the company or subscribe further issue of securities.
Penalty would be levied on the Company under the provisions of section 450 of the Companies act, 2013 as no specific penalty has been provided for the said noncompliance under the act.
* The penalty to be levied under Section-450 of the Companies Act, 2013 is as mentioned hereunder: “Fine which may extend to Rs. 10,000 and in case of continuous contravention, a further fine of which may extend to Rs. 1,000 per day after the first during which the contravention continues.”
Summary: Failure to convert physical securities into demat form by the specified deadline carries significant repercussions for private companies. They risk being unable to issue securities, undertake buybacks, issue bonus shares, or offer right issues. Moreover, security holders may face restrictions on transferring securities or subscribing to further issues. Non-compliance also attracts penalties under Section 450 of the Companies Act, 2013, emphasizing the importance of adhering to the new mandate.
This scheme aims to grant a condonation of delay to LLPs for filing of Form-3, Form-4, and Form-11 from September 1, 2023 to September 30, 2023.
The Ministry of Corporate Affairs (MCA) has notified the Limited Liability Partnership (LLP) Amnesty Scheme. The ministry vide circular number No. 8/2023 issued on 23rd August 2023 condoning the delay in filing of Form-3, Form-4 and Form-11 under Section 67 of Limited Liability Partnership (LLP) Act, 2008 read with Section 460 of Companies Act, 2013.
These forms shall be available for filing from 01.09.2023 onwards till 30.11.2023 (both dates inclusive). Also, the LLPs availing the scheme shall not be liable for any action for delayed filing of the Form-3, Form-4 and Form-11.
Based on the representations received by the government that certain LLPs are finding difficulties in filing Form- 3 (LLP Agreement and changes therein), Form- 4 (Notice of appointment, cessation, change in name/ address/designation of a designated partner or partner and consent to become a partner/ designated partner) and Form- 11 (Annual Return of LLP) for various reasons including due to mismatch in the master data in electronic registry of the Ministry.
Due to this, the records/data in the electronic registry are also not being updated. Thus, to address these issues, the government has decided to grant one-time relaxation in additional fees to those LLPs who could not file the Form 3, 4 and 11 within the due date and provide an opportunity to update their filings and details in master data for future compliances.
The following are highlights of Amnesty Scheme:
The Form-3 and Form-4 would be processed under Straight Through Process (STP) mode for all purposes except for change in business activities.
The stakeholders are advised to file these forms in sequential manner i.e., the filing for old events date may be filed first and so on so as to update the master data in proper manner.
At the time of filing these forms, the pre-filled data as per existing master data of the LLP shall be provided in each of above mentioned forms but the same shall have the facility to edit. The onus of filing correct data would be on the stakeholders.
In case of misrepresentation, the Designated Partner and the professional certifying the form may be liable for adverse action as per provisions of the law.
The filing of Form-3 and Form-4 without additional fee shall be applicable for the event dates 01.01.2021 and onwards.
For events dated prior to 01.01.2021, these forms can be filed with 02 times and 04 times of normal filing fees as additional fee for small LLPs and Other than small LLPs respectively.
The filing of Form-II without additional fee shall be applicable for the financial year 2021-22 onwards.
Form-II for previous years (prior to financial year 2021-22) can be filed with 02 times and 04 times of normal filing fee as additional fee for small LLPs and Other than small LLPs respectively.
These forms shall be available for filing from 01.09.2023 onwards till 30.11.2023 (both dates inclusive). The LLPs availing the scheme shall not be liable for any action for delayed filing of the Form-3, Form-4 and Form-11.
A company cannot file a strike-off application unless it has filed overdue financial statements and overdue annual returns.
The Ministry of Corporate Affairs (MCA) has notified an amendment to the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016.
The amendment provides more clarity on the filing requirements of overdue financials before applying for strike-off.
As per the amended norms, a company cannot file a strike-off application unless it has filed overdue financial statements under section 137 and overdue annual returns under section 92, up to the end of the financial year in which the company ceased to carry out its business operations.
Previously, the MCA had removed the requirement for up-to-date financial results and annual returns, vide the amendment introducing the Centre for Processing Accelerated Corporate Exit.
However, this requirement has now been reintroduced. The present amendment shall be effective from 10.05.2023.
Annual Filing (i.e. AOC-4 and MGT-7) is required to be filed before applying for Strike off.
As per the amendment made in rule 4 in May 2019 and amendment made on May 2023 “no application in Form No. STK-2 shall be filed by a company unless it has filed overdue returns in Form No. AOC-4 (Financial Statement) or AOC-4 XBRL, as the case may be, and Form No. MGT-7 (Annual Return), up to the end of the financial year in which the company ceased to carry its business operations”
Therefore, after amendment in Rule 4 w.e.f. 08th May, 2019 read with notification dated 10th May 2023, annual filing of AOC-4 and MGT-7 is mandatory up to the end of the financial year in which the company ceased to carry its business operations. In other words, Company is required to file AOC-4 and MGT-7 up to financial year till company carries its business and operations.
MINISTRY OF CORPORATE AFFAIRS
NOTIFICATION
New Delhi, the 10th May, 2023
G.S.R. 354(E).—In exercise of the powers conferred by sub-sections (1), (2) and (4) of section 248 read with section 469 of the Companies Act, 2013 (18 of 2013), the Central Government hereby makes the following rules further to amend the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016, namely:-
Short title and commencement.- (1) These rules may be called the Companies (Removal of Names of Companies from the Register of Companies) Second Amendment Rules, 2023.
(2) They shall come into force on the date of their publication in the Official Gazette.
In the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 (hereafter referred to as the principal rules), in rule 4, in sub-rule (1), the following provisos shall be inserted, namely: –
“Provided that the company shall not file an application unless it has filed overdue financial statements under section 137 and overdue annual returns under section 92, up to the end of the financial year in which the company ceased to carry its business operations:
Provided further that in case a company intends to file the application after the action under subsection (1) of section 248 has been initiated by the Registrar, it shall file all pending financial statements under section 137 and all pending annual returns under section 92, before filing the application:
Provided also that once notice under sub-section (5) of section 248 has been issued by the Registrar for publication pursuant to the action initiated under sub-section (1) of section 248, a company shall not be allowed to file the application under this sub-rule.”.
[F. No. 1/28/2013-CL-V(Part-III)]
MANOJ PANDEY, Jt. Secy.
Note: The principal rules were published in the Gazette of India, Extraordinary, Part II, Section 3 of Subsection (i), vide number G.S.R. 1174(E), dated the 26th December, 2016 and amended, vide Notification numbers G.S.R 355(E), dated the 12th April, 2017, G.S.R 350(E), dated the 8th May, 2019, G.S.R 420(E), dated the 29th June, 2020, G.S.R. 436(E), dated the 9th June, 2022 G.S.R. 658(E), dated the 24th August, 2022 and G.S.R. 298(E), dated 17th April, 2023.
The Ministry of Corporate Affairs (MCA) is all set to launch the Second Set of Company Forms on the MCA21 V3 portal, in January 2023, comprising of total 56 forms.
The first lot will consist of 10 forms to be released on January 9, 2023, and the second lot will consist of 46 forms to be released on January 23, 2023.
In order to simplify the process of integrating these forms into ( web based filing) the MCA21 V3 portal, the Ministry of Corporate Affairs has requested stakeholders to take note of the following points:
(1) For 10 forms scheduled for rollout from January 7, 2023, at 12:00 a.m. to January 8, 2023, at 11:59 p.m., company e-Filings on the V2 portal will be disabled for the specified forms that are scheduled to be released on January 9, 2023.
(2) For 46 forms scheduled for rollout on January 23, 2023, company e-Filings on the V2 portal will be disabled from January 7, 2023, at 12:00 a.m. to January 22, 2023, at 11:59 p.m.
(3) All stakeholders are advised to ensure that there are no SRNs in “pending payment” or “resubmission” status.
(4) Offline payments in V2 for the above 56 forms using the “Pay Later” option would be discontinued on December 28, 2022, at 12:00 AM. The stakeholders are required to pay for these forms in V2 online (via credit/debit card or net banking).
(5) Due to the upcoming release of 56 company forms, the V3 portal will be unavailable from January 7 at 12:00 AM to January 8 at 11:59 PM for the roll-out of 10 company forms, and from January 21 to 22, 2023, for the roll-out of 46 company forms.
(6) The V2 Portal for company filing will continue to be available for all forms except the 56 mentioned above.
LIST OF 10 COMPANY FORMS TO BE ROLLED OUT ON 09 Jan 2023
Sl. No.
Form Number
Form Name
1
SPICe+ PART A
Application for reservation of name for new company incorporation
2
RUN
Application for change of name of existing company
3
SPIce+ PART B
Integrated Company Incorporation Application
4
AGILE PRO S
Application for Goods and services tax Identification number , employees state Insurance corporation registration pLus Employees provident fund organisation registration, Profession tax Registration, Opening of bank account and Shops and Establishment Registration
5
e-AOA[INC-34]
Articles of Association
6
e-MOA[INC-13]
Memorandum of Association
7
e-MOA[INC-31]
Articles of Association
8
e-MOA[INC-33]
Memorandum of Association
9
INC-9
Declaration by Subscribers and First Directors
10
URC-1
Application by a company for registration under section 366
LIST OF 46 COMPANY FORMS TO BE ROLLED OUT ON 23rd Jan 2023
Sl. No.
Form Number
Form Name
1
DIR-12
Particulars of appointment of directors and the key managerial personnel and the changes among them
2
DIR-11
Notice of resignation of a director to the Registrar
3
DIR-3
Application for allotment of Director Identification Number
4
DIR-3C
Intimation of Director Identification Number by the company to the Registrar DIN services
5
DIR-5
Application for surrender of Director Identification Number
6
DIR-6
Intimation of change in particulars of Director to be given to the Central Government
7
INC-12
Application for grant of License to an existing company under section 8
8
INC-18
Application to Regional Director for conversion of section 8 company into any other kind of company
Sl. No.
Form Number
Form Name
9
INC-20
Intimation to Registrar of revocation of license issued under section 8
10
INC-20A
Declaration for commencement of business
11
INC-22
Notice of situation or change of situation of registered office
12
INC-23
Application to the Regional Director for approval to shift the Registered Office from one State to another state or from jurisdiction of one Registrar to another Registrar within the State
13
INC-24
Application for approval of Central Government for change of name
14
INC-27
Conversion of public company into private company or private company into public company or Conversion of Unlimited Liability Company into Limited Liability Company
15
INC-28
Notice of Order of the Court or any other competent authority
16
INC-4
One Person Company – Change in Member/ Nominee
17
INC-6
One Person Company – Conversion form
18
MGT-14
Filing of Resolutions and agreements to the Registrar under section 117
19
MR-1
Return of appointment of managing director or whole time director or manager
20
MR-2
Form of application to the Central Government for approval of appointment or reappointment and remuneration or increase in remuneration or waiver for excess or over payment to managing director or whole time director or manager and commission or remuneration to directors
21
NDH-4
Form for filing application for declaration as Nidhi Company or updation of status by Nidhis.
22
PAS-3
Return of Allotment
Sl. No.
Form Number
Form Name
23
SH-7
Notice to Registrar of any alteration of share capital
24
SH-11
Return in respect of buy-back of securities
25
SH-8
Letter of Offer
26
SH-9
Declaration of Solvency
27
NDH-1
Return of Statutory Compliances
28
NDH-2
Application for extension of time
29
NDH-3
Return of Nidhi Company for the half year ended
30
GNL-3
Particulars of person(s) charged for the purpose of sub-clause (iii) or (iv) of clause 60 of section 2
31
PAS-6
Reconciliation of Share Capital Audit Report (Half-yearly)
32
MGT-3
Notice of situation or change of situation or discontinuation of situation, of place where foreign register shall be kept
33
PAS-2
Information Memorandum
34
DIR-9
Report by the company to Registrar for disqualification of Directors
35
DIR-10
Application for removal of Disqualification of Directors
36
AOC-5
Notice of address at which books of account are maintained
37
FC-1
Information to be filed by foreign company
38
FC-2
Return of alteration in the documents filed for registration by foreign company
39
FC-3
Annual accounts along with the list of all principal places of business in India established by foreign company
40
FC-4
Annual Return of a Foreign company
41
GNL-2
Form for submission of documents with the Registrar
42
GNL-4
Addendum to form
43
MSC-1
Application to ROC for obtaining the status of dormant company
44
MSC-3
Return of dormant companies
45
MSC-4
Application for seeking status of active company
46
RD-1
Form for filing application to Regional Director
Stakeholders are advised by MCA to plan accordingly.
The MCA vide General Circular No. 09/2022 dated September 28, 2022 extends the timeline for filing e-form DIR-3-KYC and web-form DIR-3-KYC-WEB without fee upto October 15, 2022.
Director’s KYC Filing is an annual compliance and applies to every person who was allotted a DIN (Director Identification Number) on or before 31st March 2022. The purpose of filing the DIR-3 KYC form to the ROC is to keep the records of the ROC updated with the correct address, mobile and email address of the directors/designated partners.
It is a mandatory filing, and if filed within the due date of 30th September 2022, there is no government fee. The DIN Numbers for which the KYC is not filed within its due date get deactivated, and the same can be activated after the filing of DIR-3 KYC with late filing fees of Rs. 5000 for each defaulting director or the designated partner.
Representation has been received in the Ministry requesting for an extension of time beyond September 30, 2022 for filing e-form DIR-3-KYC and web form DIR-3-KYC-WEB without payment of fee.
The matter has been examined in the Ministry and it has been decided to allow filing of e-form DIR-3-KYC and web-form DIR-3-KYC-WEB without filing fee upto October 15, 2022.
MCA has further revised/ increased the ‘paid-up capital’ and ‘turnover’ thresholds applicable in the case of ‘small companies’ under the Companies Act, 2013, to reduce compliance burden for more number of companies to be treated as ‘small companies’, as part of ‘ease of doing business’ initiative.
Earlier, the definition of “small companies” under the Companies Act, 2013 was revised by increasing these thresholds, i.e. paid up capital threshold was increased from not exceeding Rs 50 lakh to Rs 2 crore and turnover threshold was increased from not exceeding Rs 2 crore to Rs 20 crore.
These thresholds, now have been further revised/ increased to amend the definition of small companies, so that more number of companies can be treated as ‘small companies’, eventually to reduce their compliance burden. Now the paid up capital threshold has been increased from not exceeding Rs 2 crore to Rs 4 core and turnover threshold has been increased from not exceeding Rs 20 crore to Rs 40 crore, which effectively means that number of small companies will increase substantially.
In the recent past, MCA has taken several initiatives/ measures in the direction of ease of doing business for corporates, like decriminalization of various provisions of the Companies Act, 2013/ LLP Act, 2008, extending fast track mergers to start ups, incentivizing incorporation of One Person Companies (OPCs) etc.
Lakhs of small companies significantly contribute to the growth of Indian economy and generation of employment. Therefore, Government is making continuous efforts by such initiatives/ measures which create a more conducive business environment for law-abiding small companies, by reducing their compliance burden so that they can focus more on their core business.
It may be noted that small companies are eligible for certain benefits/ relaxations, in the form of reduced compliance burden, some of which are listed hereunder:
i) No need to prepare cash flow statement by small companies, forming part of financial statement,
ii) Advantage of preparing and filing an Abridged Annual Return,
iii) Mandatory rotation of auditor not required,
iv) An Auditor of a small company is not required to report on the adequacy of the internal financial controls and its operating effectiveness in the auditor’s report,
v) Holding of only two board meetings in a year,
vi) Annual Return of the company can be signed by the company secretary, or where there is no company secretary, by a director of the company,
vii) Lesser penalties for small companies, etc.
In view of the fact that ‘paid up capital’ and turnover’ thresholds applicable for ‘small companies’ under the Companies Act, 2013 have been further revised/ increased, this will allow more number of companies to enjoy relaxation from certain compliance burdens.
The Ministry of Corporate Affairs (MCA) has recently extended the deadline for filing Form LLP BEN-2 and LLP Form No. 4D for Limited Liability Partnerships (LLPs). Here are the details:
