Impacts of Insolvency and Bankruptcy Code of India (IBC) on Provisions, Rules and Laws

Before the introduction of Insolvency and Bankruptcy Code, sickness issues of companies were dealt with high court through different provisions, rules and laws. There was no predetermined time limit to solve the issues and ultimately leading to a huge national waste of time and resources.

For a solution to all the above problems, Government has introduced Insolvency and Bankruptcy Code. Insolvency and Bankruptcy Code was passed on 28.05.2016 and implemented on 01.12.2016. Now all the sickness issues of Companies and dealt with National Company Law Tribunal (NCLT) with a predetermined time bound manner.

Due to the introduction of Insolvency and Bankruptcy Code, there will be lots of changes in the existing provisions, rules and laws dealt with companies. Here are some of them:

1. The Foreign Trade (Development and Regulation) Act, 1922
2. The Reserve Bank of India Act, 1934
3. The Central Excise Act, 1944
4. The Prevention of Food Adulteration Act, 1954
5. The Essential Commodities Act, 1955
6. The Securities Contracts (Regulation) Act, 1956
7. The Income-tax Act, 1961
8. The Customs Act, 1962
9. The Water (Prevention and Control of Pollution) Act, 1974
10. The Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974
11. The Air (Prevention and Control of Pollution) Act, 1981
12. The Sick Industrial Companies (Special Provisions) Act, 1985
13. The Environment (Protection) Act, 1986
14. The Prohibition of Benami Property Transactions Act, 1988
15. The Prevention of Corruption Act, 1988
16. The Securities and Exchange Board of India Act, 1992
17. The Foreign Exchange Management Act, 1999
18. The Competition Act, 2002
19. The Prevention of Money-laundering Act, 2002
20. The Limited Liability Partnership Act, 2008
21. The Foreign Contribution (Regulation) Act, 2010
22. The Companies Act, 2013 (18 of 2013) or any previous company law
23. The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015
24. The Insolvency and Bankruptcy Code, 2016
25. The Central Goods and Services Tax Act, 2017

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MSME Form I and its Purpose, Sections and Rules, Dates, Attachments

What is MSME Form I?

MSME Form I is the Form for furnishing half yearly return with the registrar in respect of outstanding payments to Micro or Small Enterprises.

Purpose of MSME Form I

All companies, who get supplies of goods or services from micro and small enterprises and whose payments to micro and small enterprise suppliers exceed forty five days from the date of acceptance or the date of deemed acceptance of the goods or services shall submit a half yearly return to the Ministry of Corporate Affairs stating the following: 

• The amount of payment due and

• The reasons of the delay

Every company shall file a return as per MSME Form I annexed to this Order, by 31st October for the period from April to September and by 30th April for the period from October to March.

Sections and Rules for MSME Form I

This form required to be filed pursuant to Order dated 22 January, 2019 issued under Section 405 of the Companies Act, 2013.

Last date to file MSME Form I 

MSME Form I initial return is should be filed within thirty days from the date of deployed on MCA 21 portal i.e. within 30 days from 1st May 2019. So the last date to file MSME Form I initial return is 30th May 2019. 

Afterward MSME Form I is required to file two times in a year:

• one in month of April and (From October to March)
• another in month of October (From April to September)

Attachment for MSME Form I

There is no particular mandatory attachment instructed by government for MSME Form I. 

Only Optional attachment option is there.

Other Information required to file MSME Form I

• Total Outstanding amount due on date
• Particulars of the name of suppliers and amount of payments due 
• Name of Supplier 
• PAN of Supplier 
• Specify the date from which amount is due 
• Reasons for Delay in amount of payments due

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DPT-3 eform (Return of Deposit) and its dates, purpose, fees, penalties, and attachments

What is DPT-3 eform

Rule-16: DPT-3 eform shall be use to file Return of Deposit or particulars of transaction not considered as deposit or both by every companies other than Government companies.

DPT-3 eform need to filed by every companies on or before 30th day of June every year to furnish the information contained by the audited account as on 31st day of March every year.

What is DPT-3 eform one time return

Rule 16(A) (3): DPT-3 eform one time return is the eform to file a onetime return of outstanding receipt of money or loan by a company but not considered as deposits, in terms of Companies Act, 2013 from 01st April 2014 to 31st March 2019 within 90 days from 31st March 2019 along with the fee as provided by the ministry.

Purpose of DTP-3 eform

Following are the purposes of the eform:

• Onetime Return for disclosure of details of outstanding money or loan received by a company but not considered as deposits in terms of rule 2(1)(c) of the Companies (Acceptance of Deposits) Rules, 2014. 
• Return of Deposit 
• Particulars of transactions by a company not considered as deposit as per rule 2 (I) (c) of the Companies (Acceptance of Deposit) Rules, 2014 
• Return of Deposit and Particulars of transactions by a company not considered as deposit 

Last Date of filing DTP-3

Eform DPT-3 one time return need to file within 90 days from 31st March 2019 i.e. 29th June 2019.
Next year onward DPT-3 eform has to be filed on or before 30th day of June every year.

Attachment for eform DPT-3

• Auditor’s certificate – Mandatory if purpose ‘Return of Deposit’ or ‘Return of Deposit and Particulars of transactions by a company not considered as deposit’ is selected
• Copy of trust deed – Mandatory if company has trust deed and details of same are mentioned in the form 
• Copy of instrument creating charge – Mandatory if company has trust deed and details of same are mentioned in the form 
• List of depositors - List of deposits matured, cheques issued but not yet cleared to be shown separately – Mandatory if company has balance of deposits outstanding at the end of the year 
• Details of liquid assets 
• Optional attachment, if any 

Fee and Penalty for DPT-3 eform

Fee applicable in case of companies having share capital

Nominal Share Capital	Fee Applicable
Less than 1,00,000	Rs. 200 per document
1,00,000 to 4,99,999	Rs. 300 per document
5,00,000 to 24,99,999	Rs. 400 per document
25,00,000 to 99,99,999	Rs. 500 per document
1,00,00,000 or more	Rs. 600 per document

Fee applicable in case of companies not having share capital:
Rs. 200 per document

Additional fee or penalty for late filing

Period of delay	Additional fees
Upto 30 days	2 times of normal fees
More than 30 days and up to 60 days	4 times of normal fees
More than 60 days and up to 90 days	6 times of normal fees
More than 90 days and up to 180 days	10 times of normal fees
More than 180 days	12 times of normal fees

Other information required to file DPT-3 eform

• Date of last closing of accounts
• Net Worth as per the latest audited balance sheet preceding the date of the return
• Maximum limit of Deposits
• Total number of deposit holders as on 1st April
• Total number of deposit holders at the end of financial year
• Particulars of deposit
• Particulars of liquid assets (amount of deposit maturing before 31st March next year and following next year)
• Amount required to be invested in liquid assets
• Details of liquid assets 
• Particulars of charge
• Total amount of outstanding money or loan received by the company but not considered as deposits
• Particulars of receipt of money or loan by a company but not considered as deposits at the end of financial year

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INC 22A Active e-Form and its applicability sections, fees and penalties, non-filing consequences and other details

Sections and Rules for INC 22A Active eform

The Central Government vide its notification dated 21st February, 2019 has amended the Companies (Incorporation) Rules, 2014 through the Companies (Incorporation) Amendment Rules, 2019 which have come into force with effect from 25th February, 2019.

As per the newly inserted Rule 25A of the Companies (Incorporation) Rules, 2014, Every company incorporated on or before 31st December, 2017 shall file particulars of the company and its registered office, in e-Form INC-22A ACTIVE (Active Company Tagging Identities and Verification) on or before 25.04.2019, later it has been extended to 15.06.2019.

Purpose of the eForm

This initiative of the ministry is a strong move to strengthen the existing governance structure.

Last Date to file INC 22A Active eform

15th June 2019 is the last date to file INC 22A Active eform.

Who can not file INC 22A Active eform

Any Company with any one of the following conditions is restricted to file INC 22A Active eform.

• if the company has not filed its due financial statements under Section 137 or due annual returns under Section 92 or both with the Registrar or
• if the company has not appointed KMP (if it is applicable) or
• if any one of the Directors of the company is a disqualified director or deactivated director (who has not filed DIR-3 KYC eform) or
• if the company has not appointed Statutory Auditor(eform ADT-1) or
• if the company has not appointed Cost Auditor (if it is applicable). 

Non-filing Consequences

If any company fails to file INC-22A ACTIVE form by the due date i.e. 25.06.2019, then that company will not be allowed to record the following event based information or changes by the registrar: 

1. SH-07 (Change in Authorized Capital); 
2. PAS-03 (Change in Paid-up Capital); 
3. DIR-12 (Changes in Director except cessation); 
4. INC-22 (Change in Registered Office); 
5. INC-28 (Amalgamation, de-merger).

Not Applicability of the form

For following companies INC 22A is exempt / not applicable for filing.

• Company incorporated after 01.01.2018;
• Companies which have been struck off;
• Company under process of striking off;
• Company under liquidation;
• Amalgamated or dissolved.

Fee and Penalty for Late filing of INC 22A Active form

There is no fee applicable to file INC 22A Active eform. 

Where a company files e-Form ACTIVE”, on or after 15th June, 2019, the company shall be marked as “ACTIVE Compliant”, on payment of fee Rs. 10,000 (Ten Thousand Rupees).

Required Attachments for INC 22A Active eform

• Photograph of Registered Office showing external building and inside office also showing                  therein at least one director/KMP who has affixed his/her Digital Signature to this form. 
• Optional attachments, if any.

OTP to registered Email Id

After successful Pre-scrutiny of the form, OPT to the registered email ID button will be enable. OTP can be successfully sent to the email ID against one form, for a maximum of 10 times in one day. OTP shall be valid for a span of 30minutes. For further chances, anyone may download a fresh form on the same day or try next day. 

After entering the received OPT, the form can be verified and then it will be possible to upload to MCA.

To be digitally signed by

This form shall be signed by one director and one KMP or two directors and by one director in case of OPC. 

The person should have registered his/her DSC with MCA by using the following link (www.mca.gov.in). If not already registered, then please register before signing this form. 

Certification

This form need to digitally signed by a Chartered Accountant/ Cost Accountant or a Company Secretary in whole-time practice. 

Enter the details of the practicing professional and attach the digital signature. 

Acknowledgement

On successful submission of the eForm INC-22A, SRN will be generated and shown to the user which will be used for future correspondence with MCA. 

When an eForm is completely processed by the authority concerned, an acknowledgement of the same, if any is sent to the user in the form of an email to the email id of the company.

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Last Date of Annual Return Fillings of Private Limited Companies for FY 2016-2017

After Companies Act 2013 has been rolled out, Govt. of India has made it very strict for organizations to do all filings in time.

Failing to meet the deadline will cause heavy penalty, that is up to 12 times.

Each filing for a private limited company with RoC costs only 400 rupees, when you do the filings in time. But if you delay the annual filings after the deadlines then you might end up paying 12 times penalty for each filling.

So if you do the filing on time then it will cost you only 400 rupees whereas any late filing will cost you up to 4800 rupees.

Last Date of Annual Return Filings for FY 2016 - 2017

• 30 Sep, 2017 - Income Tax filing 
• 31 Oct, 2017 - Filing of Financial statements with RoC
• 30 Nov, 2017 - Filing of Annual Return with RoC

So only 3 months left for all private limited companies to complete all compliance for 2016-2017. If you have not yet started looking at your accounts then its high time you should look into it now to avoid last minute rush and heavy penalty.

For any assistance on annnual return filing of your company contact us at +91 9090 966 477 or drop an email at [email protected].

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How GST (Goods and Services Tax) is different from Past Indirect Taxes

We all know that GST (Goods and Services Tax) is the indirect tax, that has been already rolled out in India from 1st July, 2017. GST has replaced almost all the indirect taxes. GST has come with some new features which are very different from the past indirect taxes. Following are the major difference between the past indirect taxes and GST.

One GST instead of several Taxes

Previously there were several indirect taxes in India, which made the taxation system difficult and complicated. But GST has subsumed almost all the indirect taxes and make the taxation system easy and simple.

VAT and Service Tax under one GST 

Before implementation of GST, Government used to collect VAT and Service Tax separately. VAT was levied and collected by State whereas service tax levied and collected by Center. But after the implementation of GST, both VAT and Service Taxes are treated under GST.

Tax Burden

In Previous Taxation system, the tax rate was higher as it had several indirect taxes and also different states imposed different taxes in case of inter-state transaction. Each indirect taxes added a level of tax burden to the end user. As GST replaced almost all the indirect taxes, the overall tax burden is less as compare to the previous tax structure.

Compliance 

Previous indirect tax compliance was a difficult and complicated one. For each tax, the tax payer/dealer worked separately starting from paying tax to filing return. But in GST system, the compliance is less. The tax payer/dealer need to work only one that is GST.

Inter-state Transaction

Previously inter-state transaction for goods and services treated differently. All the inter-state transaction for goods are covered by CST while all the inter-state transaction for services are covered by service tax. But in GST all the inter-state transaction comes under IGST.

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What are the Taxes replaced by GST (Goods and Services Tax)

GST or Goods and Services Tax has rolled out from July 1, 2017. GST is the biggest reform in India’s Tax system. GST has replaced a numbers of Central taxes as well as State taxes. Below is the list of replaced taxes by GST.

Central Taxes those are replaced by GST

1. Central Excise Duty
2. Service tax
3. Additional Duties on Excise
4. Excise on Medicines and Toiletries Preparation
5. Special Additional Duty (SAD)
6. Surcharge and Cesses
7. Central Sale Tax

State taxes those are replaced by GST

1. Value Added Tax(VAT)
2. Purchase Tax
3. Entry Tax
4. Entertainment Tax
5. Luxury Tax
6. Betting, Gambling, Lottery Tax
7. Surcharge and Cesses
8. Local Body Taxes

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