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CondonATion of delAy SCheme 2018 – neW yeAr GifT To STruCk off ComPAnieS by roC
(a) he incurs any of the disqualifications have been analysed in their chronological
specified in section 164; order below:
** ** ** 4.1 Para 1 states that the Scheme shall be
applicable from January 1, 2018 to March
164(2) No person who is or has been a
director of a company which— 31, 2018.
4.2 Para 2 deals with the definitions part
(a) has not filed financial statements or an-
nual returns for any continuous period under which 3 important definitions are as
of three financial years; or follows:
(i) “Overdue documents”mean the financial
(b) ** ** **
statements or the annual returns or other
CODS-2018: Whether it is Perfect New associated documents, as applicable,
in the case of a defaulting company
Year Gift by MCA? and refer to documents mentioned in
3. The Scheme is made effective from January paragraph 5 of the scheme.
1, 2018. MCA has also in its own way provided (ii) “Company” means a company as defined in
an opportunity to the defaulting companies clause 20 of section 2 of the Companies
vide its new year gift, i.e., ‘CODS-2018’ to Act, 2013;
make a fresh start subject to updating all u Section 2(20) of the Companies Act
pending annual filings under this Scheme. 2013: “company” means a compa-
Since the Scheme is only for a limited time ny incorporated under this Act or
period and is applicable only to selected under any previous company law
entities, it may be, said that, the gift from
MCA is not for all but for a selected or (iii) “Defaulting company” means a company
targeted audience only. which has not filed its financial state-
ments or annual returns as required
ROCs all over the country had, a few months under the Companies Act, 1956 or
ago, during Aug-September 2017, struck Companies Act, 2013, as the case may
down all defaulting companies which had be, and the Rules made thereunder for
not commenced their business within 1 year a continuous period of three years.
from the date of incorporation or which had
not been doing business for preceding 2 u Analysis: The reading of above defini-
years. The Scheme does not allow such struck tions clarifies the following position:
off companies to file any documents under this u only companies under the Act, 2013
Scheme which is a major setback, as ROCs had are eligible to file overdue docu-
recently struck down some 2 lakh (approx.) ments;
4
companies so this Scheme will be only useful to
few companies which have not filed their annual u out of above companies only those
financial statements and annual returns. Hence, falling under the category of defaulting
MCA has overlooked such large number of company, i.e., which are yet to file
companies and their associated disqualified their annual financial statements and
directors by keeping them out of this Scheme. annual returns under the Companies
It’s quite debatable to call this Scheme as a Act, 1956 or Companies Act, 2013 are
worthy new year gift. eligible to file overdue documents;
u permitted documents to be submitted
CODS-2018: Highlights under this Scheme shall be limited
4. The Scheme is divided into 8 Paras which
146 January 20 To January 26, 2018 u Taxmann’s Corporate Professionals Today u Vol. 41 u 40
