The Association of Corporate Advisors and Executives has written a representation letter to the Ministry of Corporate Affairs for the extension of timelines for holding Annual General Meeting (AGM) under the Companies Act, 2013 for the Financial Year ended 31.03.2021, due to the COVID-19 outbreak. Read the official representation letter below:
ASSOCIATION OF CORPORATE ADVISERS & EXECUTIVES
(Registered under the Societies Registration Act, 1860)
An ISO 9001 : 2015 Certified Organization
6, Lyons Range, 3rd Floor, Unit 2, Kolkata-700 001
Ref. No. ACAE/2021-2022 September 13, 2021
Shri Rajesh Verma, IAS
Ministry of Corporate Affairs Government of India
Dr. Rajendra Prasad Road
New Delhi 110 001
Subject: Request for extension of timelines for holding Annual General Meeting (AGM) under the Companies Act, 2013 for the Financial Year ended 31.03.2021 due to COVID-19 outbreak.
Brief about the party making representation
At the outset, we appreciate and acknowledge the sincere efforts and various initiatives of the Ministry of Corporate Affairs (MCA) and its sensitivity and promptness in providing relief, relaxations and respite to the Corporate Sector, Professionals, and Business Owners/Entrepreneurs and other connected Stakeholders at large in these unprecedented COVID Pandemic times by providing various relaxations and extension of timelines for adherence of several compliance requirements under the provisions of the Companies Act, 2013 (CA, 2013) and the Limited Liability Partnership Act, 2008 (LLP Act, 2008).
We are thankful to the Union Finance Minister for steering our economy so well even amidst and post - Covid 19 difficult financial situation. Finance Ministry has taken various structural reforms to support the economy financially, which includes various initiatives like: Atmanirbhar Bharat (आत्मनिर्भर भारत), MSME Financial Assistance, CFSS Scheme, GST Amnesty Scheme, LLP Settlement Scheme.
We would like to bring it to your kind attention that the operations of Companies have been disrupted and disturbed due to stringent covid restrictions imposed during the second wave of Covid -19 and no State was left untouched. This Covid 19 pandemic has drastically hampered not just financial conditions but restrained activities supporting businesses. Audit firms and the companies both are facing big challenge in conducting remote audits due to lack of infrastructure, technology and other support which entail extra costs. There have been delay and restraints in providing and verification of information, records, data etc. for the Audit purposes, especially where key support staff members of the Company has got changed or shifted to native places or not available in view of COVID 19 Pandemic.
According to the media reports, the third wave of Covid -19 Pandemic is expected to arrive around end of September, 2021 in India. Scientists from Indian Institute of Technology (IIT) Kanpur show simulations for India, several states and districts. The latest projections show rise in cases by 1 lakh day in coming months with mutant coronavirus strains showing up.
Please be apprised that, in the present pandemic situation, the onslaught of COVID-19, which has affected a lot in India and fear of onset of 3rd wave, the timely holding of Annual general Meeting (AGM) of the Companies as per the provisions mentioned under the Companies Act, 2013, for the year ended 31st March 2021 is very difficult due the reasons mentioned above.
Please be apprised that, in order to provide relief from difficulties faced by various stakeholders, the Securities and Exchange Board of India (SEBI) has already introduced a circular vide Circular No. SEBI/HO/CFD/CMD1/P/CIR/2021/60 dated 23rd day of July, 2021 to extend the timeline for conduct of AGM by top 100 listed entities by market capitalization. A copy of the above mentioned SEBI Circular is enclosed to this letter as “Annexure A” for your ready reference.
We would like to bring to your kind notice that, in order to provide relief to the stakeholders and difficulties reported by the taxpayers and other stakeholders in electronic filing of Income-tax returns and various reports of audit under the provisions of Income-tax Act, 1961, Central Board of Direct Taxes (CBDT) has extended the timelines for filing of Income-tax returns and various reports of audit for the Assessment Year 2021-22 vide Circular no. 17/2021 dated 09.09.2021. A copy of the above mentioned CBDT Circular is enclosed to this letter as “Annexure B” for your ready reference.
Please be apprised that, Financial Statements and Audit Reports are pre-requisite for convening the Annual General Meeting (AGM) for the Company. Due to current scenario as mentioned above, it is very difficult to conduct physical audit and verification of the Company records and also not possible to conduct Audit by remote mode completely. The non- working of new income tax portal has added more problems for above issue. The non-downloading of data from Income Tax Portal, which is extremely necessary for proper certification of various financial figures, is further adding to the woes of various stakeholders.
It is therefore requested that, to mitigate the hardships of Corporate and public at large the time period for holding Annual General Meeting for the year ended 31st March, 2021 be extended till 31st December 2021.
We are also requested to your good office to provide extension for the One Person Companies (OPC) whose financial statements duly adopted by its member, along with all the documents which are required to be attached to such financial statements, within one hundred eighty (180) days from the closure of the financial year as per Section 137 of the Companies Act, 2013.
We sincerely hope that the Ministry would provide the requisite reliefs being sought by the companies, professionals and other relevant stakeholders. Your favourable consideration would surely promote the cherished vision and initiative of Prime Minister of “Ease of Doing Business” with Minimum Government, Maximum Governance.
For Association of Corporate Advisers & Executives
(CA Vivek Agarwal)