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.
Relaxation for holding Extraordinary General Meeting (EGM) through Video Conferencing (VC) or other Audio-Visual means (OAVM)
Due to the pandemic caused by COVID-19, Companies are requested to take all urgent business, other than ordinary business or business where the person has right to be heard, which require the approval of members through the postal ballot or e-voting without holding a physical general meeting. In case of unavoidable circumstances companies are allowed to conduct EGMs on or before June 30,2020, through Video Conferencing or other audio visual means along with the facility of e-voting (If required) after complying the prescribed procedure and all the resolutions related thereto shall be filed with Registrar of Companies within 60 days. In this regard MCA further clarified the manner and mode of issue of notices to the members before convening the general meeting.
[Source: MCA Circular dated April 08, 2020] [Source: MCA Circular dated April 13, 2020]
Release of FAQ’s related to COVID 19 on CSR Contribution
The contribution on various funds is not qualified as admissible CSR Expenditure as:- 1. Chief Minister’s Relief Fund’ or ‘State Relief Fund for COVID-19 2.Making Payment of salary/wages to employees and workers, including contract labour. 3. Making Payment of wages made to temporary/casual /daily wage workers.
[Source: MCA Circular dated April 10, 2020]
Relaxations for ROC filing of IEPF e-forms due to outbreak of COVID-19
In continuation of relaxation(s) as provided by MCA vide its circular dated March 24, 2020 and March 30,2020, MCA has decided to provide the necessary relaxation for filing ofvarious other IEPF e-forms i.e. IEPF-1, IEPF1A, IEPF-2, IEPF-3, IEPF-4, IEPF-7 and e-verification of claims filed in e-forms IEPF-5, with authority without payment of additional fees till September 30, 2020.
[Source: MCA Circular dated April 13, 2020]
Discontinuation of Form CAR towards COVID-19
Web based service as introduced by MCA i.e.(Company Affirmation of Readiness towards COVID19) has been discontinued w.e.f.April 14, 2020.
[Source: MCA Notices, dated April 14, 2020]
Holding of annual general meetings by companies whose financial year has ended on December 31, 2019
As preventive measure against COVID-19, these companies may hold their AGM within a period of nine months from the closure of FY i.e.by September 30, 2020 and the same shall not be viewed as a violation.
[Source: MCA Circular dated April 21, 2020]
Extension in the validity of reserved names and resubmission of forms
Validity of reserved names in case of proposed Companies/LLP’s and existing companies/LLP’s (in case of name change) expiring during March 15, 2020 to May 03, 2020 would be extended by 20 days beyond May 03, 2020. Also, those SRNs where last date of resubmission falls between March 15, 2020 to May 03, 2020, additional 15 days beyond May 03, 2020 would be allowed for resubmission. However, for SRNs already marked under not to be taken on record, extension would be provided on case to case basis.
[Source: MCA Notification dated April 22, 2020]
Further Extension of time limit for Independent Director Registration in the IICA Databank
For the registration of existing Independent Directors in the IICA databank the due date has been further extended for two months i.e. June 30, 2020 (7 months from the earlier notification).
[Source: Companies (Appointment and Qualification of Directors) Amendment Rules, 2020]
Further Extension in the last date for filing of form NFRA-2
The time limit for filing of form NFRA-2, for the reporting period Financial Year 18-19, will be 210 days from the date of deployment of this form on the website of National Financial Reporting Authority.
[Source: MCA Circular dated 30.04.2020]
RBI Updates
100% foreign direct investment allowed under automatic route for insurance Intermediaries
Key highlights of the amendments are as follows: 100% FDI under automatic route is allowed to intermediaries or insurance intermediaries, insurance brokers, reinsurance brokers, insurance consultants, corporate agents, TPA, surveyors and loss assessors and other entities as notified by IRDAI. FDI upto(49%) of the total paid-up equity of the Indian insurance company shall be allowed on the automatic route subject to verification by the IRDAI andother conditions as specified in the amended rules.
[Source: Foreign Exchange Management (Non Debt Instrument) (Second Amendment) Rules, 2020]
DIPP
Review of FDI policy for curbing opportunistic takeovers/acquisitions of Indian companies due to the current COVID-19 pandemic
Government of India has revised the FDI policy, where a non-resident entity or the beneficial owner of an investment, situated in or is a citizen of a country, which shares a land border with India can invest in India only under the approval route. Further, any transfer of ownership of any existing or future FDI to such person(s) as mentioned above will also require government approval.
[Source: DIPP Press Note 3 dated April 17, 2020]
IBBI
Exclusion of period of lockdown for timelines imposed under IBBI Regulations
IBBI has inserted a regulation 47A for Exclusion of period of lockdown, in which the period of lockdown imposed by CG due to COVID-19 outbreak shall not be counted for the purposes of computation of the outline for any task that could not be completed due to such lockdown in relation to any liquidation process.
[Source: IBBI Notification dated April 17, 2020]