Executive Summary The Ministry of Corporate Affairs (MCA) has introduced the Companies Compliance Facilitation Scheme, 2026 (CCFS-2026) vide General Circular No. 01/2026 dated February 24, 2026. Operative from April 15, 2026 to July 15, 2026, the Scheme offers eligible companies a three-month window to regularise overdue statutory filings at dramatically reduced costs — paying only 10% of the applicable additional late fees. Inactive entities may simultaneously opt for dormant status (at 50% of normal fees) or apply for voluntary strike-off (at 25% of normal fees). Crucially, the Scheme grants immunity from prospective penal action in specified circumstances. Upon the Scheme’s conclusion, the Registrars of Companies have been directed to initiate strict enforcement action against defaulting companies.

1.  Background and Legislative Context

Under the Companies Act, 2013 (the ‘Act’), every company incorporated in India is obligated to file its Annual Return (under Section 92) and Financial Statements (under Section 137) with the Registrar of Companies (‘RoC’) within prescribed timelines. The Annual Return in Form MGT-7/MGT-7A must ordinarily be filed within 60 days of the Annual General Meeting (‘AGM’), while Financial Statements in Form AOC-4 must be filed within 30 days of the AGM.

Fees for filing such documents are governed by Section 403 of the Act read with the Companies (Registration Offices and Fees) Rules, 2014. With effect from July 1, 2018, a significant additional fee of INR 100 per day has been levied for delays in filing annual returns and financial statements, with no upper cap on the total amount payable. Over months or years of non-compliance, this uncapped daily levy compounds into a substantial financial burden — often amounting to several lakhs of rupees, far exceeding the economic value of many smaller companies.

The scale of the problem is considerable. With active companies in India now exceeding 20 lakh — a milestone reflecting the formalisation of the economy and growth among MSMEs, One Person Companies (‘OPCs’), producer companies, and new-age enterprises — a significant segment of these entities has accumulated compliance arrears. Representations from industry stakeholders, particularly MSMEs and private limited companies, highlighted the mounting difficulty of meeting compliance requirements, leading to what practitioners have described as ‘compliance paralysis’.

In exercise of its powers under Section 460 read with Section 403 of the Act, the Central Government has introduced CCFS-2026 — a calibrated amnesty measure designed to improve the accuracy and integrity of the MCA-21 corporate registry, provide relief to genuinely struggling entities, and facilitate a clean exit for dormant or defunct companies at concessional rates.

2.  Applicability and Exclusions

CCFS-2026 is available to all companies registered under the Act, subject to specific exclusions. The following categories of companies are expressly excluded from the Scheme’s benefits:

• Companies against which a final notice for strike-off of name has already been issued by the RoC under Section 248 of the Act (or erstwhile Section 560 of the Companies Act, 1956);
• Companies that have already filed an application for voluntary strike-off under Section 248;
• Companies that had applied for dormant status under Section 455 of the Act prior to the commencement of the Scheme;
• Companies that have been dissolved pursuant to a scheme of amalgamation under the Act; and
• Vanishing companies — i.e., companies whose registered offices cannot be traced by regulatory authorities.

All other registered companies — including private limited companies, public limited companies, OPCs, small companies, NBFCs, foreign companies with a place of business in India, and entities filing legacy forms under the Companies Act, 1956 — are eligible to avail the Scheme during its operative period.

3.  Duration of the Scheme

CCFS-2026 will be operational for a fixed window of three months from April 15, 2026 to July 15, 2026. This window is intended to provide companies with sufficient time to conduct a compliance audit, collate outstanding documents, and complete all requisite filings through the MCA-21 portal. Given the finite nature of this window and the MCA’s stated intent to pursue strict enforcement action upon its conclusion, eligible companies should treat this timeline as non-extendable and act with urgency.

4.  Statutory E-Forms Covered

The Scheme applies to a comprehensive set of e-forms relating to annual returns and financial statements under both the Act and the erstwhile Companies Act, 1956:

 

Applicable Law	E-Forms Covered
Companies Act, 2013	MGT-7, MGT-7A — Annual Returns (private and small companies) AOC-4, AOC-4 CFS — Financial Statements AOC-4 NBFC (Ind AS), AOC-4 CFS NBFC (Ind AS) — NBFC Financial Statements AOC-4 (XBRL) — XBRL Financial Statements ADT-1 — Appointment of Auditor FC-3, FC-4 — Foreign Company filings
Companies Act, 1956 (Legacy Forms)	Form 20B — Annual Return (companies with share capital) Form 21A — Annual Return (companies without share capital) Form 23AC, Form 23ACA — Balance Sheet & Profit/Loss Account Form 23AC-XBRL, Form 23ACA-XBRL — XBRL variants Form 66 — Compliance Certificate Form 23B — Statutory Auditor Appointment

 

5.  Fee Structure and Filing Options

CCFS-2026 provides companies with three distinct pathways depending on their operational status and compliance objectives. The fee structure for each is summarised below:

 

Category	Option	Fee Structure
Active companies with pending filings	File pending annual returns/financial statements	Normal filing fee + only 10% of applicable additional late fees
Inactive companies	Apply for Dormant Company status (Form MSC-1)	50% of normal filing fee
Defunct/closed companies	Apply for voluntary strike-off (Form STK-2)	25% of prescribed filing fee

 

5.1  Option 1: Regularising Pending Annual Filings

Eligible companies with overdue annual returns or financial statements may avail this option by paying the normal filing fee together with only 10% of the total additional late fees otherwise payable under the Companies (Registration Offices and Fees) Rules, 2014. This represents a 90% waiver on accumulated late fees — a relief that is particularly significant for companies that have been non-compliant for multiple financial years.

To illustrate: a private limited company that has failed to file Forms MGT-7 and AOC-4 for five consecutive years could have accumulated additional fees of approximately INR 3.65 lakh per form (INR 100/day × 365 days × 5 years + 2 months). Under CCFS-2026, the company would only be required to pay 10% of that amount, i.e., approximately INR 36,500 per form — representing a saving of over INR 3.28 lakh per form.

5.2  Option 2: Applying for Dormant Company Status

Inactive companies that do not intend to close down entirely but wish to minimise ongoing compliance obligations may apply under Section 455 of the Act to be classified as a ‘dormant company’ by filing e-Form MSC-1. Under the Scheme, the applicable filing fee is reduced to 50% of the normal fee. Once classified as dormant, such a company is required to file a minimal annual return (Form MSC-3) and is exempted from several other compliance requirements, making it a practical option for companies holding intellectual property, assets, or special-purpose vehicles.

5.3  Option 3: Voluntary Strike-Off

Companies that have ceased operations and wish to formally wind down may apply for voluntary strike-off under Section 248 of the Act by filing e-Form STK-2. During the Scheme period, this may be done at 25% of the otherwise applicable filing fee. This route allows promoters and directors to cleanly exit the corporate registry, thereby avoiding the continued accumulation of compliance obligations, late fees, and potential disqualification proceedings.

6.  Immunity from Penal Consequences

One of the most significant features of CCFS-2026 is the protection it extends from adjudicatory and penal proceedings in relation to delayed filings. The immunity provisions, however, are calibrated and must be understood carefully:

6.1  Annual Returns and Financial Statements (Sections 92 and 137)

For defaults in filing annual returns (Section 92) and financial statements (Section 137), the Scheme provides immunity from penalties subject to the following conditions:

• If the company completes the pending filings under the Scheme before the issuance of a notice by the adjudicating officer, no penalty shall be levied.
• If a show cause notice has been issued, the company may still obtain immunity by completing its filings within 30 days of the date of such notice.
• If the 30-day window post-notice has already expired, or if an adjudication order imposing penalties has already been passed, the liability of the company and its officers to pay such penalties remains unaffected — the filing under the Scheme does not extinguish that liability.

6.2  Other Specified Forms (ADT-1, FC-3, FC-4 and Legacy Forms)

For the remaining covered forms — namely ADT-1, FC-3, FC-4, Form 20B, Form 21A, Form 23AC, Form 23ACA, Form 23AC-XBRL, Form 23ACA-XBRL, Form 66, and Form 23B — immunity from prospective penal action for delayed filings is available, provided that:

• The relevant forms are filed under the Scheme; and
• No prosecution or show cause notice has been issued prior to such filing.

Key Takeaway: Act Before Notice is Issued Companies that file their pending returns before the RoC issues any show cause or adjudication notice will secure full immunity from penalties under Sections 92 and 137 of the Act. Once a notice is issued, the protection window narrows to 30 days. Companies where adjudication orders have already been passed will not benefit from immunity and must separately address outstanding penalty orders.

 

7.  Consequences of Non-Availing: The Post-Scheme Enforcement Landscape

The MCA’s circular makes the post-Scheme enforcement intent explicit: upon the conclusion of CCFS-2026 on July 15, 2026, all Registrars of Companies will initiate necessary action under the Act against companies that remain in default. The regulatory consequences of continued non-compliance are severe and multi-layered:

7.1  Financial Penalties

Under Sections 92(5) and 137(3) of the Act, companies face an initial penalty of INR 50,000 for the company (and INR 10,000 for each officer in default), with an additional INR 100 per day for each day of continuing default. For Section 137 defaults, the maximum penalty for the company is capped at INR 2,00,000, while for individual officers, the per-day penalty continues up to INR 50,000. These adjudicated penalties are payable in addition to accumulated additional fees.

7.2  Director Disqualification

Under Section 164(2) of the Act, a director who has not filed annual returns or financial statements of any company for three consecutive financial years becomes disqualified from being appointed or re-appointed as a director of any company for a period of five years. This disqualification operates automatically by operation of law, without the need for a formal adjudication order, and can have far-reaching consequences for individuals serving as directors across multiple entities.

7.3  Compulsory Strike-Off

The RoC has the power under Section 248 of the Act to strike off a company’s name from the register if it has failed to commence business within one year of incorporation, or if the company is not carrying on any business or operations for two preceding financial years and has not applied for dormant status. Compulsory strike-off is distinct from voluntary strike-off and may lead to complications in the recovery of assets and settlement of liabilities for the company’s stakeholders.

7.4  Reputational and Business Implications

The MCA-21 portal publicly reflects a company’s compliance status. A company marked as ‘Active — Non-Compliant’ faces reputational damage with financial institutions, investors, and counterparties. Non-compliant companies may encounter difficulties in obtaining loans, onboarding institutional investors, or participating in government procurement processes — impacts that can be disproportionately significant for growing enterprises.

8.  Recommended Action Plan for Companies

Given the time-bound nature of CCFS-2026 and the severity of post-Scheme enforcement consequences, companies and their directors should consider the following steps immediately:

• Conduct a Compliance Audit: Review MCA-21 records to identify all pending filings across all covered e-forms and calculate the approximate additional fees that would otherwise be payable.
• Assess Eligibility: Verify that the company does not fall within any excluded category before initiating filings under the Scheme.
• Determine Appropriate Route: Decide whether to regularise pending filings (Option 1), apply for dormant status (Option 2), or initiate voluntary strike-off (Option 3) based on the company’s current status and future business plans.
• Engage Professional Advisors Promptly: Compile all requisite documents — audited financial statements, annual return data, board resolutions, and auditor reports — well in advance of the July 15, 2026 deadline to avoid last-minute portal congestion.
• Monitor Adjudication Status: Check whether any show cause notices or adjudication orders have been issued against the company and its directors to accurately assess the scope of available immunity.
• File Before the Deadline: All filings under the Scheme must be completed by July 15, 2026. The Scheme does not contemplate any extension.

9.  Conclusion

CCFS-2026 represents a pragmatic and time-limited opportunity for a broad category of companies to bring their statutory compliance records up to date at a fraction of the cost that would otherwise be incurred. The 90% reduction in additional fees for pending annual filings, combined with immunity from prospective penal action (where notices have not yet been issued), makes this Scheme particularly compelling for MSMEs, OPCs, and private companies that have fallen behind on compliance — often due to resource constraints rather than deliberate evasion.

The MCA’s accompanying message is equally clear: the Scheme is a final, one-time opportunity. The regulatory window is narrow, and Registrars of Companies have been expressly directed to take enforcement action against non-availing defaulters after July 15, 2026. Directors and companies that do not act risk facing financial penalties, disqualification, and compulsory strike-off — all of which are significantly more costly and disruptive than regularising filings now.

Companies should therefore treat this as an urgent compliance priority and engage their legal and secretarial advisors without delay to ensure all required filings are completed within the Scheme window.