In view of the situation emerging out of the outbreak of COVID-19, which requires adherence of social distancing norms, the stakeholders have pointed about various difficulties MCA after considering this fact granted certain relaxation few of them are briefed as under.
The Ministry of Corporate Affairs (MCA) has notified the amendments to Schedule VII of the Companies Act, 2013.
The amendment is carried out in Schedule VII is to insert Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund) as Corporate Social Responsibility (CSR). http://www.mca.gov.in/Ministry/pdf/Notice_27052020.pdf
[Source: MCA Notice, Dated 27thMay 2020]
The NCLT has notified that the Regular Proceedings at NCLT shall begin from 15-06-2020.
The regular proceedings at NCLT Delhi were stopped immediately after the lockdown was announced on 24-03-2020. Now the Central Government has started to unlock 1.0 vide its Order dated 30-05-2020. The NCLT has decided to fix the dates of hearings for Principal Bench and for all its New Delhi Benches (Court No. II, III, IV, V & VI) effective from 15-06-2020 as follows: https://nclt.gov.in
[Source: NCLT Notice , Dated 3rd June 2020]
Insolvency and Bankruptcy Code (Amendment) Ordinance, 2020.
The government of India has effectively suspended fresh bankruptcy proceedings against persons impacted because of COVID-19 for at least six months, up to a maximum of one year further as follows: http://www.mca.gov.in/Ministry/pdf/IBCAmedBill_05062020.pdf
[Source: MCA Notification, Dated 05thJune 2020]
Companies (Share Capital and Debentures) Amendment Rules, 2020
MCA has notified the Companies (Share Capital and Debentures) AmendmentRules, 2020 which shall come into effect from 5th June, 2020 as follows: http://www.mca.gov.in/Ministry/pdf/Rule_08062020.pdf
[Source: MCA Notification, Dated 08thJune 2020]
MCA has issued further Clarification on the passing of ordinary and special resolutions by companies under the Companies Act, 2013 read with rules made thereunder on account of COVID-l9.
Earlier, MCA had issued a clarification on the passing of ordinary and special resolutions by companies and allowed companies to pass ordinary and special resolutions of urgent nature up to June 30, 2020 or to transact relevant business through postal ballot as per the procedure specified therein. The MCA has examined and it has been decided to allow companies to conduct their EGMs through VC or OAVM or transact items through the postal ballot in accordance with the framework provided in the aforesaid Circulars up to September 30, 2O2O. AII other requirements provided in the said Circulars remain unchanged.
[Source: MCA Circular No.22/2020, Dated 15th June 2020]
Clarification with regard to creation of deposit repayment reserve of 20% u/s. 73 (2) (C ) of the companies Act 2013 and to invest or deposit 15% of amount of debentures u/r.18 of Companies (Share capital and Debentures) Rules 2014 – COVID-19 -Extension of time-regarding’
Clarification is issued to relax the requirement under Section 73(2)(c) of Companies Act, 2013 to create the Deposit Repayment Reserve of 20% of deposits maturing during the financial year 2020-21 before 30th April, 2020, shall now be allowed to be complied with till 30th September, 2020 and for the requirement under Rule 18 of the Companies (Share Capital & Debentures) Rules, 2014, to invest or deposit at least 15% of the amount of debentures maturing in specified methods of investments or deposits before 30th April, 2020, may now be complied with till 30th September, 2020. Earlier these dates were extended up to 30th June, 2020.
[Source: MCA Circular No.24/2020, Dated 19th June 2020]
The MCA has issued a notification to further amend the Companies (Appointment and Qualification of Directors) Rules, 2014 through the Companies (Appointment and Qualification of Directors) Third Amendment Rules, 2020
which shall come into force on the date of their publication in the Official Gazette i.e 23-06-2020. Accordingly, MCA has further extended the last date for registration of details of Independent Directors in the ID Data Bank for a further three months, i.e. ten months from December 1, 2019. The date is extended up to 30th September, 2020 instead of the earlier extension
granted up to 30th June, 2020.
[Source: MCA Notification,
Dated 23rd June 2020]
The MCA has issued a notification to further amend the Companies (Meetings of Board and its Powers) Rules, 2014, through the Companies (Meetings of Board and its Powers) Second Amendment Rules, 2020
The MCA has earlier provided certain relaxation w.r.t conduct of Board Meeting for approving financial statements through Video Conferencing (VC) or Other Audio-Visual Means (OAVM), upto June 30, 2020. Now through this amendment, MCA has further extended the above relaxation for all the Board meetings to be conducted till September 30, 2020, to approve its financial statements through VC or OAVM.
[Source: MCA Notification, Dated 23rd June 2020]
Relaxation introduced by SEBI
In view of the impact of the COVID-19 pandemic and the lockdown measures undertaken by Central and State Governments, based on representations, SEBI has decided to grant the following one time relaxations from strict enforcement of certain regulations of SEBI
Further extension of time for submission of financial results for the quarter/half year/financialyear ending 31stMarch 2020 due tothe continuing impact of the CoVID-19 pandemic
After taking into consideration various representations and operational challenges due to the CoVID-19 pandemic, it has been decided by SEBI to further extend the timeline for submission of financial results under Regulation 33 of the LODR Regulations, as follows: https://www.sebi.gov.in/legal/circulars/jun-2020/further-extension-of-time-for-submission-of-financial-results-for-the-quarter-half-year-financial-year-ending-31st-march-2020-due-to-the-continuing-impact-of-the-covid-19-pandemic_46924.html
[Source: Circular No.: SEBI/HO/CFD/CMD1/CIR/P/2020/106dated 24th June 2020]
Further extension of time for submission of Annual Secretarial Compliance Report by listed entities due to the continuing impact of the CoVID-19 pandemic
In March, the markets regulator had extended the deadline by one month from May 31 to June 30 and now it has further been extended to July 31. The decision has been taken after the regulator received representations from the Institute of Company Secretaries of India, industry bodies, and listed entities requesting the extension of time for submission of Annual Secretarial Compliance Report in view of the difficulties faced by entities and practicing company secretaries due to the impact of COVID-19. This Circular shall come into force with immediate effect i.e 25-06-2020. The Stock Exchanges are also advised to bring the provisions of this circular to the notice of all listed entities that have issued specified securities and also disseminate on their websites.
[Source: Circular No.: SEBI/HO/CFD/CMD1/CIR/P/2020/109dated 25th June 2020]
Securities and Exchange Board of India (Infrastructure Investment Trusts) (Second Amendment) Regulations, 2020
Through this amendment, a new Regulation 7A has been inserted specifying de-classification of the status of the sponsor and further inclusion as follows: https://www.sebi.gov.in/legal/regulations/jun-2020/securities-and-exchange-board-of-india-infrastructure-investment-trusts-second-amendment-regulations-2020_46886.html
[Source: SEBI Notification dated 16th June 2020]
Relaxations from certain provisions of the SEBI (Issue of Capital andDisclosure Requirements) Regulations, 2018 in respect of Further Public Offer
SEBI has decided to provide similar relaxations in the eligibility conditions related to Fast Track Further Public Offer (FPO) as contained in the SEBI “ICDR Regulations as follows: https://www.sebi.gov.in/legal/circulars/jun-2020/relaxations-from-certain-provisions-of-the-sebi-issue-of-capital-and-disclosure-requirements-regulations-2018-in-respect-of-further-public-offer_46791.html
[Source: SEBI Circular No.: SEBI/HO/CFD/CIR/CFD/DIL/85/2020dated 09th June 2020]
The Cabinet approves an upward revision of MSME definition and modalities/ road map for implementing the remaining two Packages for MSMEs (a) Rs 20000 crore package for Distressed MSMEs and (b) Rs 50,000 crore equity infusion through Fund of Funds.
upward revision of MSME definition and modalities/ road map for implementing the remaining two Packages for MSMEs as follows: https://pib.gov.in/PressReleseDetailm.aspx?PRID=1628344
[Source: PIB Press Release, Dated 1st June 2020]
Insolvency Professionals to act as Interim Resolution Professionals, Liquidators, Resolution Professionals and Bankruptcy Trustees (Recommendation) Guidelines, 2020
Resolution Professionals and Bankruptcy Trustees (Recommendation) Guidelines, 2020 which shall come into force from 1st July, 2020. Further, these Guidelines have been issued in supersession of the earlier Guidelines issued on 28th November, 2019 and other amendment as follows: https://ibbi.gov.in//uploads/legalframwork/71d50e11656190259af4e3fe5427d943.pdf
[Source: IBBI Notification , Dated 2nd June 2020]