The weekly messenger | Edition 22.20

Auditing News

Generation of UDIN in bulk for certificates – 17 June 2020

The ICAI has incorporated a new provision of generating Unique Document Identification Number (UDIN) in bulk for Certificates in its UDIN portal. By using this facility now, the members will be able to generate UDIN in bulk (i.e. upto 300 UDINs) for various types of Certificates in one go. This process can be done through uploading of an excel file.  

For more information, click here.

Regulatory News

Extension of time for EGMs – 15 June 2020

Due to COVID-19, the Ministry of Corporate Affairs (MCA) had issued two Circulars in the month of April 2020, wherein it had issued certain clarifications on passing of ordinary and special resolutions by companies by holding extraordinary general meetings (EGMs) through video conferencing or other audio visual means or passing of certain items only through postal ballot without convening general meetings. As per the said clarifications, the companies were allowed to hold relevant EGMs or transact relevant business through postal ballot, as per the prescribed procedures up to 30 June 2020 or till further orders, whichever is earlier.

Now, the aforesaid timeline has been extended till 30 September 2020. However, all the other requirements provided in the erstwhile Circulars remain unchanged.

For more information, click here.

Scheme for relaxation of time for filing forms related to creation or modification of charges under the Companies Act, 2013 – 17 June 2020

The MCA has introduced a Scheme namely ‘Scheme for relaxation of time for filing forms related to creation or modification of charges under the Companies Act, 2013’. The purpose of this Scheme is to condone the delay in filing certain forms related to creation/modification of charges. The Scheme provides guidance with respect to the following:

• Applicability of the Scheme

• Time period for applicability of the Scheme

• Applicable fees

• For which cases the Scheme is not applicable.

The ICAI has also issued frequently asked questions (FAQs) on the aforesaid Scheme.

For Scheme, click here.

For ICAI’s FAQs, click here.

Clarification w.r.t. creation of deposit repayment reserve of 20% u/s 73(2) (c) of the Companies Act 2013 and to invest or deposit 15% of amount of debentures u/r. 18 of Companies (Share Capital and Debentures) Rules, 2014 – COVID-19 – Extension of time – 20 June 2020

The MCA had issued ‘Special Measures under Companies Act, 2013 and Limited Liability Partnership Act, 2008 in view of COVID-19 outbreak’, wherein the

• requirement under section 73(2)(c) of the Companies Act, 2013 to create the deposit repayment reserve of 20% of deposits maturing during the financial year 2020-21 before 30 April 2020 was extended till 30 June 2020; and

• requirement under Rule 18 of the Companies (Share Capital & Debentures) Rules, 2014 to invest or deposit at least 15% of amount of debentures maturing in specified methods of investments or deposits before 30 April 2020 was extended till 30 June 2020.

Now, the MCA has further extended the aforesaid timelines till 30 September 2020. However, other requirements as provided in the Special Measures remains unchanged.

For more information, click here.  

SEBI (Issue of Capital and Disclosure Requirements) (Amendment) Regulations, 2020 -16 June 2020

The Securities and Exchange Board of India (SEBI) has amended the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 with the SEBI (Issue of Capital and Disclosure Requirements) (Amendment) Regulations, 2020, wherein certain changes have been made in Regulation 172(3), which deals with conditions for qualified institutions placement.

The aforesaid regulation states that the issuer shall not make any subsequent qualified institutions placement until the expiry of six months from the date of the prior qualified institutions placement made pursuant to one or more special resolutions.

Now, as per the revised Regulation, the period of ‘six months’ has been substituted with ‘two weeks’.

These Regulations shall come into force w.e.f. 16 June 2020.

For more information, click here.

SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2020 – 16 June 2020

The SEBI has amended the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 with the SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2020, wherein the following changes have been made:

• In Regulation 3(2), which deals with Substantial acquisition of shares or voting rights, a new proviso has been inserted before the existing provisos i.e.“Provided that the acquisition beyond five per cent but up to ten per cent of the voting rights in the target company shall be permitted for the financial year 2020-21 only in respect of acquisition by a promoter pursuant to preferential issue of equity shares by the target company.”

• In Regulation 6(1), which deals with Voluntary Offer, the following has been inserted after the first proviso:“The relaxation from the first proviso is granted till 31 March 2021.”

These Regulations shall come into force w.e.f. 16 June 2020.

For more information, click here. 

Regulatory measures to continue – 18 June 2020

In view of the uncertainty observed in the recent past due to concerns relating to COVID-19 pandemic and the resultant fear of economic slowdown, the SEBI vide its Press Release dated 20 March 2020 had introduced various regulatory measures for a period of one month w.e.f. 23 March 2020. This date later got extended till 28 May 2020 and 25 June 2020 respectively.
Now, the SEBI has once again decided to further extend the validity of the aforesaid regulatory measures till 30 July 2020.

For more information, click here.