CORPORATE LAW CA CS Harsh Kishan Yadav

UPDATES
INSOLVENCY AND
BANKRUPTCY CODE
Ministry of Law and Justice vide the Insolvency and Bankruptcy Code (Amendment)
Ordinance, 2020 dated 5th June, 2020 made certain amendments in the Insolvency and
Bankruptcy Code, 2016.
Introduction of Section 10A - Suspension of Initiation of Corporate Insolvency Resolution
Process.
No application under (Section 7, 9 and 10 of IBC Code, 2016) for initiation of Corporate
Insolvency resolution process of a Corporate debtor shall be filed, for any default arising on
or after 25th March, 2020 for a period of six months or such further period, not exceeding
one year from such date, as may be notified in this behalf.

Source: Section 10A - IBC

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SECURITIES AND EXCHANGE
BOARD OF INDIA
Securities and Exchange Board of India vide Circular No SEBI/HO/CFD/CMD 1 /CIR/
2020 140 dated 29th July, 2020 extended the time period for submission of financial
results for the Quarter/Half year/Financial year ending 30th June, 2020 under Regulation
33 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, by a month,
till 15th September, 2020.

Source: SEBI Extension

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MINISTRY OF CORPORATE
AFFAIRS
MCA vide notification dated 5th June, 2020 amended Rule 8 (Issue of Sweat Equity Shares)
and Rule 18 of Companies (Share Capital and Debentures) Rules:
A) Sweat Equity Shares
As per the amendment, earlier notification GSR 180(E) dated 17th February, 2016 issued by
the Department of Industrial Policy and Promotion of Industry and Internal Trade, Ministry
of Commerce and Industry, Government of lndia replaced with notification GSR 127(E),
dated the 19th February, 2019 Now the new entity can be considered as Start up up to 10
years (as per conditions mentioned in the notification) and accordingly avail the benefits.
Consequent to this amendment, a Start up company can issue sweat equity shares not
exceeding fifty percent of its paid up capital up to 10 years from the date of its
incorporation or registration (Previously it was allowed only for 5 years)
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MINISTRY OF CORPORATE
AFFAIRS
B) Debenture Redemption Reserve
Further, in Rule 18 7 ))(b)(v) is substituted to read that a company shall on or before the 30th
day of April in each year, in respect of debentures issued by such a company, invest or
deposit, as the case may be, a sum which shall not be less than fifteen percent of the
number 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 in sub clause (vi).
Provided that the amount remaining invested or deposited, as the case may be, shall not at any
time fall below fifteen percent of the amount of the debentures maturing during the year ending
on 31st day of March of that year.

Source: MCA DRR - 05.06.2020

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MINISTRY OF CORPORATE
AFFAIRS
In continuation of the General Circular No. 14/2020 dated 8th April, 2020 and General
Circular No. 17/2020 dated 13th April, 2020; Ministry of Corporate Affairs vide General
Circular No. 22/2020 dated 15th June, 2020 allowed companies to hold EGM through
VC/OAVM (Video Conferencing/ Other audio visual means) till 30th September, 2020
Now the companies can hold/conduct their Extra Ordinary General Meeting through
VC/OAVM or transact items through postal ballot in accordance with framework
provided in the above mentioned circulars up to 30th September, 2020.

Source: MCA - EGM VC/OAVM

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MINISTRY OF CORPORATE
AFFAIRS
MCA vide General Circular No. 24/2020 dated 19th June, 2020 further extended the time
period i.e. from 30th June, 2020 to 30th September, 2020 in respect of the following
matters:
1. Creation of Deposit Repayment Reserve of 20% u/s 73(2)(c)
2. 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 the respective
financial year.

Source: MCA - Extension

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MINISTRY OF CORPORATE
AFFAIRS
MCA vide General Circular No. 23/2020 dated 17 th June, 2020 introduced a “Scheme for
relaxation of time for filing forms related to Creation or Modification of Charges under
the Companies Act, 2013” for the purpose of condoning the delay in filing certain forms
related to creation/modification of charges .(Satisfaction of charge is not covered)
This scheme shall be applicable in respect of filing of:
•Form CHG-1: Application for registration of creation, modification of charge (other than
Debentures)
•Form CHG-9: Application for registration of creation, modification of charge for Debentures
Where the date of creation modification of charge is before 1 st March, 2020 but the timeline for
filing (30/60 days) such form had not expired under section 77 of the Act as on 1 st March, 2020;
OR falls on any date between 1st March, 2020 to 30th September, 2020 (both dates inclusive).
Source: MCA - Charges
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MINISTRY OF CORPORATE
AFFAIRS
MCA vide notification dated 23rd June, 2020; further extended the relaxation w.r.t transaction of restricted
matters through video conferencing up to 30th September, 2020 under Rule 4 of Companies (Meeting of
Board and its Power) Rules, 2014.
List of restricted matters which can now be dealt through video conferencing till 30th September,
2020:
a) Approval of Financial Statements
b) Approval of Board’s Report
c) Approval of the Prospectus
d) Audit Committee Meetings for consideration of Financial Statement (including CFS, if any)
e) Approval of matter relating to amalgamation, merger, demerger, acquisition and takeover
Source: MCA - BM VC
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 THANK YOU.
CA CS HARSH KISHAN (M) 90333 71520

YADAV caharshyadav@gmail.com