India: Clarifications on Condonation of Delay Scheme, 2018

June 25, 2018


Condonation of Delay Scheme, 2018

The Condonation of Delay Scheme, 2018 (hereinafter referred to as the “Scheme”) was introduced by the Ministry of Corporate Affairs (hereinafter referred to as “MCA”) vide General Circular 16/2017, dated December 29, 2017, wherein defaulting companies, i.e., companies which had not filed financial statements or annual returns under the Companies Act, 1956/2013 for a continuous period of three years, were permitted to file their overdue documents. It is to be noted that companies whose names have been struck off from the Register of Companies are not included as defaulting companies under the Scheme.

Under the Scheme, the DINs of disqualified directors would be temporarily activated to enable them to file documents. The defaulting companies would file the overdue documents in the respective prescribed e-forms and thereafter would seek condonation of delay by filing form e-CODS by paying a fee of INR 30,000.

Discrepancy with respect to e-CODS

MCA has received various representations from stakeholders wherein they raised doubts regarding filing of e-CODS in cases where petitions had been filed before NCLT under Section 252 of the Companies Act, 2013, and orders were pending from NCLT. Section 252 deals with filing of appeal by a company for unjustified removal of name from the Register of Companies. The issue was whether such companies could file for CODS upon obtaining orders even after May 1, 2018.

Clarification by MCA

The issue was examined by MCA and thereafter MCA issued clarifications vide General Circular no. 05/2018 dated May 17, 2018[1] . MCA clarified that in such cases, the Registrar(s) of Companies shall raise a ticket through Change Requirement Form (hereinafter referred to as “CRF”) on MCA21 portal along with copy of NCLT order and E-governance shall activate DIN of the Directors of such struck off companies that have been revived through NCLT to file e-CODS, 2018.

It was further stated that the directors whose DINs are proposed to be activated through CRF should not be directors of any other company which has been stuck off other than the one revived through NCLT order as mentioned in CRF. The same may be ensured by the Registrar(s) of Companies before raising CRF with E-governance.

MCA has also stated that the Registrar(s) of Companies are directed to ensure that CRFs are raised in such cases only after thorough scrutiny of the NCLT orders and ensuring that such struck off companies had filed overdue documents before filing e-CODS, 2018, and had filed petitions before the NCLT during the validity of CODS.

[1]Available at

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