ICSI Requested MCA for Relaxation in Compliance Procedures for Companies

ICSI is an acronym for The Institute of Company Secretaries of India, has released a letter in requesting for relaxations in the provisions of the Companies Act, 2013  due to Coronavirus. The letter is issued to Thursday for the Ministry of Corporate Affairs (MCA)

ICSI stated in the letter that Due to COVID-19, the government imposed a countrywide lock down on transport as well as the movement of people.in this matter, ICSI is requesting the government to grant some relaxations from some compliance under the Companies Act, 2013, ICSI also suggested some relaxation in the same letter.

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According to the letter, the suggestions for the relaxation are

1. MCA be requested for exemption from the requirement of dispatching the physical copies of the Annual Report as stated under Companies Act, 2013’s Section 136. 
2. The companies may be allowed to consider the restricted matters required to be conducted at meetings of the board through circular resolution. 
3. In the current situation, the company may not be able to open a dedicated bank account and dispatch the warrants, and physical dividends to the shareholders, who have not made electronic payment facilities mandatory. It also needs to be considered that bank facilities are also not fully functional thus they are also providing limited services to stakeholders. Additionally, the post offices along with courier services are also halted all over India. Even after lockdown, for some time, these will be active in a few areas only. Thus, the time limit also needs to be relaxed to determine or marking of the dividend funds.
4. For the FY 2019-20, a deduction as per the Section 80G of the Income Tax Act, 1961 can be claimed, regarding donations made before 30th June 2020.
5. MCA extended the time-frame for various IEPF e-forms filing even eliminated additional fee. But as directed in Section 124(5) which is related to transfer of unpaid dividend as well as in Section 124(6) which is related to the transfer of shares the timeline had been not extended. Both timelines need to be extended, otherwise, it may prejudice the interest of Investors. Because, if Corporate choose to deposit the money or transfer of shares, the last chance for the Investor for preventing of the same may not be accessible or can’t be availed in view o due to the lockdown. Thus relaxation in the timeline need to be considered seriously.
6. The MCA is also requested to consider the temporary halt or a relevant extension of the due dates for all such e-forms filing.