The law must be interpreted as per the requirement of changing times. - Justice Dhananjaya Y. Chandrachud, Supreme Court of India

• The outbreak of communicable malady recognised today across the globe as Coronavirus (COVID-19) has undeniably left an unforgettable and unfortunate scar on the functioning of our entire nation, the institutions and entities established by the framework of law.
   
• World Health Organization has been assessing this outbreak around the clock and we are deeply concerned both by the alarming levels of spread and severity. We have therefore made the assessment that COVID-19 can be characterized as a pandemic, remarked the Director General while briefing the media on 11th Day of March 2020. Therefore it is a well settled fact, that COVID-19 is highly contagious and dangerous in nature.
   
• At the outset, several measures are being embraced by the Government of India (GOI) for not only combating against the pernicious virus but also for promoting and facilitating a better atmosphere for the corporates and entities alike by rolling out various relaxations.
   
• The GOI’s efforts were not only limited to declare the situation as notified disaster but also to enable the provisions of Epidemic Diseases Act, 1897 and Disaster Management Act on the 14th Day of March 2020, so as to deploy such measures and imposing temporary regulations to be observed by the public.
   
• It could be viewed that imposing lock downs to refrain public movement was not the only agenda of the GOI but also to establish certain mechanisms by the means of temporary measures to avoid complete destabilization of corporate domain. This is seen of more than a notion and sheer appreciation has to be bestowed upon the Government of India for being considerate upon the impact of COVID-19 upon the corporate environment.
   
• Declaration of Masks and hand sanitizers as essential commodities by the GOI under Essential Commodities Act up to the 30th Day of June,2020 is also one of the pro-active measures taken up for the greater benefit of the community.
   
• The Ministry of Corporate Affairs vide notification captioned General Circular No. 10/2020 dated 23rd day of March 2020 had elucidated that spending of funds maintained for CSR towards COVID-19 and it’s preventive measures is an eligible CSR Activity. For the purpose of the same, the said spending can be undertaken under serial number (i) promoting health care including preventive health care and sanitation and (xii) disaster management to Schedule VII of the Companies Act, 2013.

Interim Measures By The Ministry Of Corporate Affairs:
In the advent of COVID-19 threatening the probity of Companies in India, the Ministry of Corporate Affairs (MCA) in order to promote and protect the interest of the stakeholders had established certain interim relaxations by issuing a circular captioned General Circular No. 11 /2020 dated 24th Day of March 2020.

The rationale behind deploying such interim measures is to reciprocate the ideals of the Ministry towards addressing the current situation, reducing compliance burden and in the best interest of the companies domiciled under law. Below reproduced comprehensively are the relaxations enlisted by the MCA in comparison with the existing compliance provision ought to be complied by the companies.

Compliance Aspect	Pre Relaxation Compliance	Post Relaxation Compliance
Column I	Column II	Column III
Filing of forms with the MCA	Companies are required to file the respective returns and documents within the time specified in this regard under the respective provisions of the Companies act, 2013 (the Act). However, filing returns beyond specific time period would attract late filing fees.	# The ministry has imposed a moratorium period on its registry from 1st day of April 2020 to 30th day of September 2020. #  Moratorium as per Merriam-Webster’s dictionary is defined as a legally authorized period of delay in the performance of a legal obligation # During this said period, the companies are authorized to file their pending returns and documents with the ministry without the levy of any additional filing fee notwithstanding the due date which has already went past or the due date which may occur during the said period. # This means that the company is provided with a fresh opportunity to clear off all pending filings from their end during the said period without the MCA taking cognizance of the same. For Example: A company has to file Annual returns in   form MGT-7 with the Registrar of Companies (ROC) pertaining to the Financial year ended 31st March 2019. The same has not been filed till date. As already been known, late filing fees are effective from 1st day of January 2020. Now a company can make use of this moratorium period to file the said annual return with ROC without incurring any additional filing fee and without reciprocating any comments from the ROC.
Board meetings	Section 173(1) of the Act state that Every company shall hold the first meeting of the Board of Directors within thirty days of the date of its incorporation and thereafter hold a minimum number of four meetings of its Board of Directors every year in such a manner that not more than one hundred and twenty days   shall intervene between two consecutive meetings of the Board.	# Considering the pre-relaxation compliance to hold board meetings within 120 days of previous meeting, there would be certain companies who would have scheduled their board meetings closer to the end of the financial year or would be planning to hold meetings of board during the month of April or May 2020. # On being considerate about the nationwide pandemic situation and lock downs in several places, the ministry has extended the time to hold the meeting of the board of directors by 60 days over and above the period of 120 days. However this relaxation is only available till 30th day of September 2020. For Example: ABC Limited held its board meeting on 20th December 2020 and its next meeting is scheduled to be held on 10th April 2020. Now considering the situation and by the virtue of given relaxation, the company can hold board meeting anytime but not later than 17th June 2020. # Earlier the MCA on 19th day of March 2020 issued the Companies (Meetings of Board and its Powers) Amendment Rules, 2020 to allow the directors of the companies to participate in the meeting of board of directors by the mode of video conferencing for the restricted items enlisted under Rule 4 of Companies (Meetings of Board and its powers) Rules, 2014 such as Approval of Financial statements, Approval of Board report, approval of prospectus, audit committee meetings etc. without requirement of physical quorum being present. This notification is effective till 30th day of June 2020.
The Companies (Auditor's Report) Order,2020	The MCA had issued notification S.O. 849(E) dated 25th day of February 2020 which is captioned Companies (Auditor's Report) Order, 2020. The said notification states as under: Every report made by the auditor under section 143 of the Companies Act on the accounts of every company audited by him, to which this Order applies, for the financial years commencing on or after the 1st April, 2019, shall in addition, contain the matters specified in paragraphs 3 and 4 of the said notification	# Due to non-availability of various services, lock down situations in various areas, the uncertainty ahead and to reduce the compliance work on the part of companies and the auditors, the MCA has decided to change the applicability/commencement of Companies (Auditor’s Report) Order, 2020 from the current financial year (2019-20) to financial year 2020-21. # Hence the auditors have to comply with the requirement of stating such matters in their audit report as required under the said rules for the accounts of the company that would be presented to the shareholders in the year 2021.
Meeting of Independent Directors	Independent Director by the virtue of law has been bestowed with more responsibility in discharging his duties in the best interest of the companies. Section 149(8) of the Companies Act, 2013 mandates that Independent directors shall adhere to the code of conduct for such directors as listed out under Schedule IV to the Act. Schedule IV mandates that The independent directors of the company shall hold at least one meeting in a financial year without the attendance of non-independent directors and members of management.	# There would be certain companies in the geography of India, whose Independent directors would have scheduled a meeting which is mandatory under pre relaxation regulations before the closure of the current financial year (FY 2019-20). However due to the restrictions on movement laid down by the GOI, companies would not be in a position to hold such meetings. # To provide solution to this requirement, the MCA has rolled out a relaxation stating that non-holding of meeting of Independent directors during FY 2019-20 would not be treated as a violation and no action would be taken against the same. In simple sense, the requirement of holding meeting of Independent directors for the FY 2019-20 has been waived off.
Deposit Repayment Reserve Account	Section 73(2)(c) of the Act signifies that a company shall open an account with a scheduled bank and deposit more than 20 percent of the amount of deposit maturing during the following financial year in such account within 30th day of April of each year. Such account be known as Deposit Repayment Reserve account.	# The MCA has made it clear that under interim relief provided, companies shall open bank account with scheduled banks as listed under Schedule II of RBI Act and deposit/deposit more than 20 percent of the amount of deposit maturing during the following financial year into the Deposit Repayment Reserve account within 30th day of June 2020. # It is pertinent to note that the purpose of opening and maintaining such account is to pave way for repayment for deposits in case of uncertainty and non-payment on case to case basis. Hence the time period for compliance for such deposit into account is extended to 30th June 2020 instead of 30th April 2020.
Debenture Redemption Reserve Account	# Rule 18 (Sub provision 7(b)) of Companies (Share Capital and Debentures) Rules, 2014 enlists those companies that are not required under the purview of the act to constitute a debenture redemption reserve account on the basis of classification on public and privately placed debentures. # Further provision 7(b) (v) provides that every other company covered under the rules other than those exempted from such requirement shall deposit or invest a sum which shall not be less than fifteen per cent., of the amount of its debentures maturing during the year, ending on the 31st day of March of the next year in any one or more methods of investments or deposits as provided. Such investment or deposit shall be made before 30th day of April every year.	# There is no relaxation with respect to the percentage of amount that has to be deposited or invested as required under the Rules. # The relaxation rolled out with respect of the said rules are that, a sum of not less than 15 percent of the amount of debentures matured during the year as   on 31st March 2021 shall be deposited or invested in the specified methods of investments or mode of deposit under the Act within 30th day of June 2020instead of 30th day of April 2020. # The said relief is a time based measure and no procedural measures have been relaxed by the MCA.
Commencement of Business	Section 10A of the Act confers a mandatory obligation on then newly incorporated companies to not commence any business operations or borrow monies unless a declaration to the effect in e-form INC-20A is filed by a director within a period of one hundred and eighty days of the date of incorporation of the company.	# Not only the GOI has rapidly taken steps for reducing the compliance on established companies but has made certain relaxations in case of newly incorporated companies or companies that are going to be incorporated. # Companies are given an additional time period of 180 days to file the declaration for commencement of business with the ROC over the period of 180 days already given by the Act. For Example: ABC Limited acquired the status the legal status of company vide obtaining certificate of incorporation dated 31stOctober 2019. In the case, the company is required to file the certificate of incorporation within 28th day of April 2020. By the virtue of relaxation bestowed by MCA, the company can file the declaration to the MCA by 25th day of October 2020 (Additional 180 days).
Resident Director	The provisions of Section 149(3) of the Act, makes it mandatory and sensible that every company shall have a necessarily have one director who is physically present in the territory of India for a total period of not less than one hundred and eighty-two days during the financial year.	# Non presence of at least one director in India is essentially treated as a non-compliance and taken cognizance of by the regulator. # In this regard, owing to various restrictions on travel and movement, the MCA has rolled out a relief to the companies stating that if at least one director of any company is not physically present in the territory of India as required under the Act, that would not amount to non-compliance for the ‘financial year 2019-20’ only.

Concluding Remarks:
The constant efforts along with relief made and provided by the GOI and MCA for the benefit of the stakeholders has emerged remarkable and has given a new life to the corporates to come in line with the law who had not been compliant so far. The MCA is undoubtedly living in line with the vision and mission statement enshrined in the Citizen’s charter for MCA as under:

Vision Statement:
To facilitate corporate growth with enlightened regulation.

Mission Statement:
To be responsive and sensitive to changes in the business environment and suitably formulate and modify corporate laws and regulations from time to time.

Written By: Vignesh Kumar, LCS & A. Srivastava, CS Professional