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Intestate Succession

As the name suggests, a will is a declaration that expresses the desires or wants of a person with relation to his property and estate and also provides for its transfer upon his/her death. In ordinary language, succession means inheritance. When a person dies, inheritance or succession follows.


Hindu Succession Act

The Hindu Succession Act is the act which states the rules and procedures relating to inheritance applicable to Hindus, Sikhs, Jains, and Buddhists etc. Majority of India follows the Hindu Succession Act, whereas for Muslims Sharia law is prevalent in India. The Indian Succession Act which covers Christians as well as those people who are not covered under the Hindu Succession Act and Sharia Law.

Succession is a very complex process in a diverse and dynamic country like India. There are two types of Succession:

  1. Testamentary successionIt is a type of succession in which the deceased had executed a will, and the property is divided as per the execution of the will.
  2. Intestate succession: In India, as per the provisions of Indian Succession Act, 1925 if one dies without writing a valid will, he is said to be died intestate and his property will be distributed as per the provisions of the succession law applicable to him.


Intestate Succession

A person is said to die intestate when he/she dies without making a will that means without disposing off his/her property to the heirs.  Sometimes, disposition under the will is also not possible on account of the illegal bequest or invalid bequest.  Intestacy can either be total or partial.

Under the circumstances, when a person dies intestate, the deceased’s assets are distributed among the heirs as per the provisions of the Indian Succession Act. The distribution or vesting of the assets takes place according to the relevant personal laws. There are situations, when there is more than one heir, thus giving rise to complexities and difficulties.


Intestate Succession among Hindus                                                                                                                    

The laws relating to intestate succession among Hindus was amended and consolidated by the Hindu Succession Act passed in the year 1956. The law is applied to all the persons who practise religions like Hinduism, Jainism, Sikhism, and Buddhism. In the year, 2005, the act was further amended. The act contains provisions related to the situation where an individual dies without making a will.


Below mentioned are the claims that can be made when a male dies without making a will.

1st Claimant: They are known as the Class I legal heir, which includes the mother, wife and children of the deceased. All of them have equal rights over the assets. In case, any child of the deceased is no more than the property is given to the child and wife of the deceased child.

2nd Claimant: When there is no one available from class I legal heirs, then the class II legal heir comes into the picture. They are father, sibling, living children’s grandchildren, sibling’s children of the deceased.

3rd Claimant: When class I legal heirs and class II legal heirs are absent then the property can be claimed by the Agnates. They are defined as the distant blood relatives of father’s side, also known as Male Lineage.

4th Claimant: When all the three levels of the class heir are absent, then the property is given to the Cognates. Cognates are the ones who are blood relatives of the mother’s side, also known as Female Lineage.


Below mentioned are the claims that can be made when a female dies without making a will.

1st Claimants: The first claimants of the deceased female are the children and the husband. They can divide the property among them equally.

2nd Claimants: When the class I heirs are not available; the claim is made by the heirs of the husband.

3rd Claimants: In the absence of 1st and 2nd claimants, the mother and father of the deceased can make a claim.

4th Claimants: There are chances when 3rd claimants are not there to claim property, and therefore the heir of the father gets the property.

5th Claimants: At the last, to opt for the property of the deceased, the claim is given to the heir of the mother.

There are circumstances when an intestate dies, and no claimants are available. In such a situation, the property is devolved to the State Government by following the procedure of the law.


Where there’s Covid, there’s Will

Due to the recent outbreak of Covid-19 across the country and the lockdown imposed by the Central Government, it is noticed that the number of request for drafting wills had increased tremendously. The older people and rich people have started thinking to execute their wills in the amid fear of Coronavirus. People have started considering that dying after executing a will is far better than dying intestate, for the sake of the family as well as the society.



In ancient times, executing a will was considered a taboo in India. However, as the time has passed, people have realised the importance and need of executing a will as it not only saves a lot of time while dividing the property but also helps to divide the property without any conflicts between the family, it is recommended that when a person wants to execute his/her will, they should always consult a legal person whom they trust. Legal advice in such a matter is essential. Writing a will, once considered a somewhat morbid exercise, is now a must-do for India’s rich as well as the middle class.

Corporate India's Covid-19 Action Plan: How to Balance Data Protection with Emergency Response

On March 11, 2020, the World Health Organization (WHO) declared COVID-19 as a pandemic, effectively urging countries to take all necessary measures to detect, test, isolate treat people in order to avoid handful of cases resulting into clusters and community transmissions that further stress capacity of global public health institutions. In case of COVID-19, the pandemic declaration is reflective of its spread, unlike intensity. Both prior to and post issuance of the WHO directive, the Indian Government, through the Ministry of Health and Family Welfare, has notified multiple travel, immigration, employment and public health-related advisories to proactively contain and delay onset of the outbreak in India.

Some of these measures include all except specific visas to India to be suspended until April 15, 2020, requiring persons having visited Italy/South Korea to submit negative status COVID-19 declarations from recognized laboratories of such countries as a condition for entry into India, mandatory medically supervised quarantine for a minimum period of 14 days for persons having visited high-risk countries, home quarantine for all travellers entering India, to name a few. The State and municipal authorities have separately issued travel and public health advisories directed at private citizens, organizations and public administration bodies.

The COVID-19 pandemic has resulted in unprecedented disruption to civic and business activities across the world, and it is fair to assume that the evolving situation will continue to demand more resources, mobilization, focus and expense in times to come.

Like other countries, the responsibility of responding to the COVID-19 crisis is largely affixed on immigration and public health professionals in India, however managing a novel crisis of such magnitude surely mandates an organized and consistent response from all capable stakeholders. It’s therefore good to see corporate organizations extending proactive health, safety, accessibility, employment protection and continuity measures to protect their employees and partners from possible exposure. Their objective is two-fold, one – depending on the industry and nature of employees in question, to comply with their statutory obligations relating to providing a safe working environment to all employees; and two – to respond, contain and delay a public health crisis with the means at their disposal, ensure business continuity in view of the expanding nature of the disease, reduce chances of community transmission in their offices in order to avoid a complete shutdown of business activities on a long-term basis.

The initial step of any corporate COVID-19 action plan will be to collect and monitor information pertaining to employees and partners, including their travel history (both official and personal), symptoms including of self and of family members, interaction with suspected or confirmed COVID-19 persons, as well as medical information. It’s fair to assume that most organizations are unlikely to have pre-existing disaster management plans that are specific to prevention of infectious diseases such as COVID-19, that has resulted in companies collecting and asking for information not anticipated either in policies or consent frameworks established till date. This practice is of concern, as it is equally important for employers to understand the need to balance emergency response with protection of privacy of their employees, workers, consultants or extended workforce. It is interesting to see how data protection principles are implemented in practice in times of emergencies, as it is then naturally desirable to find a consent-based or legitimate purpose approach towards personal data to be an academic objective – good to have, but who can really implement this? And if it this endeavour is even proportionate considering the risks involved in taking time to implement a program that is legally compliant? Practical approach is key, but how to implement that is often fraught with uncertainty.

Current legal position in India

The current data protection law (IT Act) classifies an employee’s physiological and / or health information, medical records as sensitive personal data (SPDI), which is considered sensitive and therefore worthy of more protective safeguards. Information such as travel history of self and family members, exposure to suspected persons, may be classifiable as personal data (PI) which is protected but with lesser restrictions.

IT Act – SPDI and PI

The law entails that any SPDI collected, processed or stored either for providing a service or under a lawful contract or otherwise must be described under a privacy policy, informed consent should be obtained prior to collection of the SPDI, purpose of usage of the SPDI should be disclosed in advance, and the SPDI collected should be stored only for the period necessary to serve the specified purpose. Organizations are mandated to implement reasonable security practices and procedures such as ISO 27001 for that are commensurate with nature of its business. Collection, processing and storage of PI can be done provided a privacy policy is put in place.

All employers can therefore collect health information/records or travel history of an employee by stating its intended purpose under a privacy policy. For collection of SPDI, additional consent requirements are to be met, and the SPDI can be collected only in connection with providing a service (say, arranging an insurance provider for health coverage) or under terms of a lawful contract. Organizations are not liable for accuracy of the information submitted by the employees, if it is requested to transfer such information to Government agencies. Employees are legally entitled to refuse consent, though this right seems to be available only when an employer is collecting SPDI for providing a service.

COVID-19 data protection practices in other countries

EU General Data Protection Regulation (EUGDPR) is more nuanced and allows organizations to collect and process information on grounds of legitimate interest, or to comply with their employer or legal obligations, as applicable in each country. Despite this enablement, data protection authorities across Europe have asked employers to exercise caution in implementing their COVID-19 action plans and urged them to consider proportionality even in face of a pandemic situation. Some examples are:

– The Italian Privacy Authority on March 02, 2020 has asked employers not to collect employee health information or ask them about contact with suspected symptom persons in a systematic and generalized manner, and stated that such inquiries and checks should instead be conducted by civic and public health administration authorities.

– In France, the Data Protection Authority has reminded employers of their legal obligations under EUGDPR and French public health codes and clarified that COVID-19 action plans cannot require disclosure of medical and health information which goes beyond the management of suspected exposure, and infringe on privacy rights of employees and visitors. It has specifically stated that checking of body temperature and systematic daily processing of said data, asking employees /visitors to submit health declarations is not legally permissible. It has instead encouraged employers to educate employees, ask employees to undergo tests with public health authorities, and set up remote working facilities.

-The UK data protection authority, Information Commissioner’s Office (ICO) has taken a more pragmatic approach and assured employers that they are cognizant that in pressing times, usual governance and compliance frameworks could be relegated lesser priority, and that employers will not be penalized if they are prioritizing other areas to contain the outbreak amongst their employees, visitors and partners. ICO has however confirmed that this flexibility should not be construed by organizations to forego principles of proportionality, and only such information which is not excessive in the given circumstances should be collected and processed by employers.

Corporate India COVID-19 response

Companies are asking employees, visitors and contractors to share travel history (professional/personal) to high-risk countries, share travel history of family members to high-risk countries, share symptoms of self or family members, undergo mandatory health check-ups, and submit medical declarations. Travel history of self and family members is being correlated with symptoms for persons who have not visited high-risk countries by employers, for possible community transmissions. Persons with suspected or confirmed COVID-19 are asked to identify persons of contact, to assist employers to administer quarantine and hygiene measures. Employees are also asked to submit medical records for processing of leave, medical coverage, and remote working assistance. Employers have also set in place extensive hygiene measures and have encouraged employees with or without symptoms to work from home, discouraged travel plans or any large gatherings.

Areas of concern – data protection perspective

The above measures are helpful in containing community transmission and allowing businesses to address business continuity concerns, but employers are also unknowingly exposing themselves to legal risks by requesting for mass and constant information disclosures. For instance, many employers do not have privacy policies or consent frameworks that envisage collection of information on grounds of prevention of public health emergency, or community transmissions. Many nascent companies have not invested infrastructurally on security procedures relevant for processing and storage of medical records of their employees.

Collection of travel history, exposure to suspected or exposed persons

Travel history of employees, or whether they have and exposure to a suspected or confirmed COVID-19 person is classifiable as PI and can be obtained without consent. While is important for the same to be envisaged under the employer’s privacy policy, at a practical level, official travel data will anyways be visible to employers. If described under the privacy policy or with certain amendments to such policies, travel plans of employees and their family members (if proportionate to responding to the current crisis), any COVID-19 exposure details can be requested.

Collection of medical records or medical condition

Health data – namely, medical information, records, condition, information on exposure to suspected or confirmed COVID-19 persons if accompanied with symptoms is classifiable as SPDI and can be collected, processed or stored with prior consent of the employee/visitors. Some companies may have obtained such consents through employment contracts, code of conduct applicable to employees, but this is a good time to assess if additional information being collected and processed as part of COVID-19 response is legally obtainable through existing consent frameworks. If such consents are not in place, corporates should incorporate obtaining them in their action plan steps. Failure to do so can expose them to compensating persons affected by any negligence or improper handling of their SPDI. Some companies are also asking for health data / declarations from their partners, visitors, consultants etc., and consent requirements will equally apply to such relationships.

Other compliances

Maintenance of adequate security procedures such as ISO 27001 is mandatory for processing and storage of SPDI, and all organizations should assess if their security standards are equipped to handle SPDI particularly health data of various employees and visitors in a systematic manner for a prolonged period of time. The IT Rules also require organizations to store SPDI until the purpose intended has been achieved, upon which the information stored should be destroyed or scrubbed from security systems as per prescribed procedures. Even though principles of data minimization are more explicitly contemplated under the Personal Data Protection Bill, 2019 and not under the IT Act, it’s still advisable for organizations to collect and process data which is proportionate to the threat envisaged to their business structures, and the urge to initiate proactive measures that are more appropriately performed by civil or public health authorities should be curtailed. Data minimization standards will already be applicable to global organizations and should be equally implemented in India. Excessive data collection will ultimately be susceptible to cybersecurity threats, which in context of health data can have complicated outcomes for data subjects.

General Q&A’s for employers

Some general Q&A’s relevant for corporate India are given below. Many of the situations described below are fact-specific, rapidly evolving and will differ in each State. Employers are advised to seek specific counsel prior to implementing their

COVID-19 action plans.

Have employment and public health authorities issued specific guidance to employers? Any specific data protection guidance?

The Ministry of Health and Family Welfare has directed employers to arrange work from home for employees required to undergo home quarantine for minimum 14 days after returning from high-risk countries. Many Indian States such as Delhi, Punjab, Haryana, Karnataka, Orissa, Gujarat, Maharashtra have notified COVID-19 as an epidemic under the Epidemics Diseases Act, 1897 empowering State and district level authorities to undertake expansive measures to contain outbreak of the disease. So far, in context of employers, these notifications only prohibit organizations from sharing any misinformation regarding COVID-19, which in our view would mean sharing of inaccurate information on nature and spread of the disease, its symptoms etc. as that is best addressed by public health bodies who are qualified to dispense such information. Advisories for employers are emerging daily across States and municipalities and will need to be checked on a case to case basis. Karnataka being the IT hub of India has been particularly active in issuing advisories, and has recommended employers to avoid large gatherings, cancel meetings, conferences, and allow remote working facilities for all employees. There are news reports of Karnataka contemplating mandatory work for home for all offices.In Karnataka, all workers covered under ESI Act who are confirmed COVID-19 cases can now avail mandatory paid leave of 28 days from their respective employers by submitting medical certificate issued by ESI hospitals. All non-ESI covered employees can avail an equivalent leave from their employers under applicable provisions of the Karnataka shops and establishment act. In this case, employers will automatically be in receipt of medical records of confirmed COVID-19 employees and can rely on such information to implement quarantine measures and educate other employees to undergo testing at Government facilities.So far, employers have been advised to grant paid leave and implement remote work facilities and except for Karnataka,have not been specifically asked to obtain and store medical records of employees.

Do I need to respond to this crisis?

Legally, the severity of your response is at your discretion. Understandably, corporates across the world are responding actively to this crisis in interest of business continuity, and not necessary to tick a legal compliance. In India, some employment legislations such as the Factories Act, ESI Act require mandatory reporting of occupational diseases by employers but COVID-19 has not been notified under said laws. Public health notices issued by Government authorities such as Bureau of Immigration, Ministry of Health and Family Welfare are also directed at citizens, and not specifically at organizations. No specific data collection obligations have been imposed on employers, though they can be justified by employers in view of other employment laws.

What more can I do to enforce success of company’s quarantine measures?

Persons who have travel history to COVID-19 countries and exposure to suspected or confirmed COVID-19 person are mandatorily required to under medical screening at the nearest hospital, and such communication can be disseminated by employers for wider reach. Government has also encouraged employers to cancel conferences, and any non-essential travel (professional or personal).

Can employees refuse to share their travel history? Or whether they have interacted with any suspected or confirmed COVID-19 person?

No. Official travel history of an employee is employer information, so no specific request is required in this regard. Companies can validly ask employees to divulge personal travel plans, or exposure with suspected or confirmed COVID-19 persons (including family members) in the interest of providing a safe working environment for all employees and third parties visiting the workplace, and also to better inform other employees of exposure and / or quarantine measures. Exposure to suspected or confirmed COVID-19 person if not accompanied with symptoms is not yet a medical condition, hence no specific consent is required to collect such information. Employers can also access CCTV imaging to verify the trail of exposure of suspected employees in order to enforce their quarantine measures. Employers should at all times practice data minimization practices and destroy information which is irrelevant or no longer serving the purpose of COVID-19 action plans.

Can employers ask employees to share their medical condition or records, including whether they have COVID-19 specially when they are displaying symptoms at the workplace?

This is tricky, as technically Government authorities have directly asked citizens to undergo medical screening at hospitals if they have travel history to COVID-19 countries combined with exposure to suspected or confirmed COVID-19 persons. If

any citizen is found to be infected, his/her information is transmitted by the relevant hospital to the district-level health authorities. Private bodies have not been asked to collect such information.

Employers can support requests for collection of SPDI such as medical condition, records on following grounds:

– Employers need to receive medical certificate certifying COVID-19 status in order to grant paid leave to the employee. Karnataka has made this mandatory, other States will follow suit;

– Employers can argue that they need to know such information in interest of providing a safe working environment for all employees, and protect themselves from tortious claims of negligence from other infected employees;

– If employers have obtained prior consent for collection and processing of such SPDI in employment contracts or code of conduct.

If we have legitimate grounds for collection of SPDI, do we really need consent?

Yes, since Indian law does not expressly permit collection of SPDI on grounds of legitimate interest or legal compliance alone. If no prior consent has been obtained, employers should include them as part of their COVID-19 action plans.

Refusal from employees can be expected and should be handled firmly with sensitivity. Employees may be concerned about possible discrimination, leave with no pay, forced quarantine upon disclosure of such information, and employers should extend support in this regard. Having said the above, like global data protection regulators, Indian authorities are likely to be accommodating of governance gaps in some areas provided employers are able to exhibit pressing needs to act upon their emergency plans, without obtaining relevant consents. The gaps should be addressed immediately once the risk is mitigated.

Can employees refuse to give consent for collection of their SPDI, like health records?

Technically, employees cannot refuse consent as the IT Act is unclear on whether employees can deny such information in public health emergencies or only when SPDI is sought in connection with provision of goods or services by the employer. I don’t have consent framework in place, I also don’t have time to do this and would like to contain the infection urgently.

Doesn’t the law envisage an exceptional situation?

Unfortunately, not. While you can continue with your emergency response in order to provide a safe working environment to your employees, from a data protection perspective, you will still not be compliant. We do expect Indian regulators to be accommodating of such gaps however, and this situation will have more clarity in some time.

Once I have obtained the medical reports, what are my obligations?

You are bound to retain and share it, only as permitted under law. Government agencies are permitted to request for SPDI to verify identity, with a written request.

Can I disclose the name of the employee to inform other possibly affected employees?

No. There are better methods of implementing quarantine measures. Personal and sensitive information of an employee should be protected, and names of affected or suspected employees should be scrubbed while being processed internally as part of action plans. It’s also important to mention that employers are obligated to extend measures to protect employees from any form of discrimination that may be attributed to their medical condition or diagnosis.

Should employers report to Government agencies once they have information of any employee’s confirmed COVID-10 status?

There is no such obligation under law as on date. The Government has directed mandated citizens of India to undergo screening and quarantine as per their travel history, symptoms and exposure to suspected COVID-19 persons. Employers should widely disseminate this directive amongst their status and network.

Can I ask employees / visitors to submit to temperature reading, medical tests prior to entering the building?

Depends what you are trying to ascertain. If it’s simply to check a fever prior to allowing entry, anyone can do that. However, any invasive or COVID-19 related checks should only be conducted by a medical professional, who may submit information to the employer or State medical authorities for necessary action. Medical professionals are themselves obligated to receive and handle patient information in a prescribed manner.

Patenting Covid-19 Related Inventions

Across the world scientists and researchers are working tirelessly to develop cheap and time effective diagnostic kits, cures and vaccines for the novel COVOD-19. There is also a pressing need for low cost ventilators.

Abbott’s diagnostic test to deliver positive results in five minutes is a major- breakthrough. In India, Mylab Discovery is the first company to receive approval in India for manufacturing their Covid-19 test kits. Even non-pharmaceutical companies are pitching in to help in this time of crisis. One example is Mahindra & Mahindra, which is working towards launching a low-cost ventilator.

In times of emergency, when an invention is the need of the hour, should innovators file patent applications to protect their innovations? What if they don’t file for patents in the larger good? Can innovation still be rewarded pending patent or without patent protection?


At the outset, it is important to examine what kind of Covid-19 related inventions may be patentable in India. Like most jurisdictions, under the Indian Patents Act, 1970 ("the Patents Act"), a product or process that satisfy novelty, non-obviousness and utility, can get patent. However, the Patents Act excludes certain inventions from the scope of patentability, e.g. use of a known or already existing drug for treatment of Covid-19 may not be patentable in India.

India also prohibits patenting of methods of treatment. This includes methods of diagnosing a disease. While methods of diagnosing Covid-19 may not be patentable, a diagnostic instrument itself can be protected as a patent. Software per se is not patentable in India. However, software combined with hardware may be patentable. Thus, software enabled diagnostic instruments could be patentable.

As per the well-known Section 3(d) of the Patents Act, exclusion, new forms of a known substance (such as salts, esters, isomers, etc) are not patentable unless such new form results in the enhancement of the known efficacy of that substance.

Indigenous innovators can e-file patent applications in India even during lock-down. Since patent is a territorial right, applications need to be filed either through the Patent Cooperation Treaty or directly in other jurisdictions within prescribed timelines with Indian filing date as priority date1. In case of existing patents, they should be available to meet the demand during exigencies.


We examine a few approaches to enable use or exploitation of pending patent applications and/or granted patents below:

- Acquisition or use of pending or granted patents by Indian Government in public interest

The Patents Act allows government of India to acquire an invention covered by a pending patent application or a granted patented for a public purpose by paying compensation to right holders. Compensation is determined based on several factors such as the expenditure incurred in connection with the invention and, in the case of a granted patent, the term of the patent, the period during which and the manner in which it has already been worked (including the profits made during such period by the patentee or by their licensee).

Separately, the Patents Act also allows the government (state, central or a government undertaking) to use an invention that forms subject matter of patent applications or are granted patents. Such use includes the right to sell the invention. Use by the government must be made upon commercial terms agreed between the patentee/applicant of the invention and the government either before or after use has begun.

Compulsory licensing of existing patents

In times of national emergency/extreme urgency, the Central government can suo moto make a declaration for grant of compulsory license in relation to a patent. Thereafter, any person interested can apply for a compulsory license. A license will then be granted on such terms and conditions decided by the patent controller.

In fact, it has been reported that some countries have already issued compulsory licenses for existing drugs currently being tested for treatment of Covid-19. Israel has issued a compulsory license related to lopinavir/ ritonavir, including in combination with other products.

On the other hand, several companies, including the patentee for the drug lopinavir/ ritonavir, are relinquishing their rights in their patented drugs in view of the pandemic. While companies are foregoing monetary incentives, such acts will bring immense goodwill and are helpful in creating a positive brand image.

Exploitation of pending patents or in the absence of patents

An important question to consider is whether innovators can be rewarded. Pending or in the absence of patent. In this state of urgency, innovators may not file patent applications before commercialising their innovations. Even if a patent application is filed, grant of a patent would take several years in most jurisdictions. Technically, a patentee’s monopoly kicks in once the patent is granted. It should be explored whether in such situations, patent grant may be expedited.

Even in the absence of a patent, innovators could and should still be rewarded. This can be done by way of licensing or royalty deals, acquisition deals or joint venture deals, where the innovator (company or individual) transfers the trade secret, know-how, formulation or technology to other entities with good manufacturing capacities or governments. Joint ventures could also be formed between two or more innovators, who pool in their resources together to find a much-needed resolution for this pandemic in public good.

In all these scenarios, the commercial interest and investment of the innovator are secured, and public good is ensured.


While a patent is an important right, the need of the hour is to balance commercial interests v/s community interest. Making inventions, know-how, technology and formulations available not only in India but across the world is of utmost importance at this stage. Innovators therefore need to decide how to exploit their patents or inventions to battle this pandemic, and whether large profits should be forgone for humanity. At the same time, it is also important for the community to respect inventions and give due credit and respect to research and innovation. Compulsory licensing, royalty based deals, joint ventures and collaborations on reasonable terms, instead of strictly enforcing patent rights, is the need of the hour. When the whole world is fighting this pandemic together at war footing, innovations must act as a weapon which can help in winning this battle.

LLP Settlement Scheme

It has been noticed by the Government that a large number of LLPs have failed/defaulted in filing Form-3 LLP [LLP Agreement and changes therein]; Form-4 [Notice of Appointment, cessation, change in name/ address/ designation of Designated Partner or Partner]; Form-8 [Statement of Account & Solvency (Annual or Interim)] and Form-11 [Annual Return of LLP] and in the event of such defaults an additional fee of INR 100/- (Rupees One Hundred Only) is levied under the LLP Act, for every day of such delay.

Due to such hefty fine involved in case of default in filing of e-forms mentioned above by the LLPs, many representations have been made from various quarters for waiver of fees or relaxation in additional fees.

As a part of ease of doing business and to give an onetime relaxation in additional fees to the defaulting LLPs to make good their default by filing pending documents and to serve as a compliant LLP in future the Ministry of Corporate Affairs, vide circular dated 4th March, 2020 have introduced a scheme - ‘LLP Settlement Scheme, 2020’ (“Scheme”), for allowing an onetime condonation of delay in filing the e-forms mentioned above which have not been filed by the LLPs with the Registrar.

Highlights of the Scheme

  • The Scheme shall come into force on 16th March 2020 and shall remain in force till 13th June 2020.
  • The Scheme shall apply only for the filing belated Form 3, Form 4, Form 8 and Form 11 which were due for filing till 31st October 2019. (The Scheme shall not apply to LLPs who have filed Form 24 with the Registrar for striking-off its name from the ROC.)
  • Reduced additional fee: The defaulting LLPs can file the said e-forms during the currency of this Scheme by making payment of an additional fee of INR 10/- per day (as against INR 100/- per day) for the delay in filing in addition to normal fee applicable for filing of suche-forms, however, the maximum additional fee shall not exceed INR 5000/- (Rupees Five Thousand Only) per e-form.
  • The defaulting LLPs availing benefit of this Scheme shall be provided with immunity from prosecution by the Registrar for such defaults.
  • Further, after completing of this Scheme, those LLPs which have not availed this Scheme and are in default of filing any of the e-forms within the specified period as per the LLP Act shall be subject to action/prosecution from the Registrar under the LLP Act

Revised LLP Settlement Scheme, 2020

MCA vide its General Circular No. 13/2020 dated 30th March, 2020, has revised the existing LLP Settlement Scheme, 2020 and thereby the last date of filing of pending documents has changed from 13th June, 2020 to 31st March, 2020. Further, by keeping the existing Scheme, certain additions in the terms and conditions have been made, which are as follows:

  • Revision in the existing Scheme: Apart from the following changes, all other conditions of the existing Scheme shall remain the same:
    1. Para 8(i) of the Scheme, effective Date: Effective date of the LLP Settlement Scheme, 2020 has revised from 16th March, 2020 - 13th June, 2020 to 16th March, 2020 - 31st March, 2020.
    2. Para 8 (vi) of the Scheme, Immunity from Prosecution: Under this Para, the last date of filing of pending documents was 13th June, 2020, which has revised to 31st March, 2020.
  • Extended LLP Settlement Scheme 2020: New Para 8A has been added in the existing Scheme and thereby it has extended to the further period, i.e., from 01st April, 2020 to 30th September, 2020. The details of the Scheme are as follows:
    1. Effective Date of the Scheme: Effective date of LLP Settlement Scheme, 2020 shall be in force from 01st April, 2020 to 30th September, 2020.
    2. Applicability: This Scheme shall be applicable to all the belated filings, which shall be due for filing till 31st August, 2020 at the normal fee. In the previous Scheme, only 4 (Four) forms were allowed to file i.e., Form-3, Form-4, Form-8 and Form-11.
    3. Late filing fee under the Scheme: No late filing fee shall be charged on the belated documents till 30th September, 2020.
    4. The Scheme shall not apply: Further, this Scheme shall not apply to those LLPs who have applied for striking off their names from the register of ROC as per Rule 37(1) of the LLP Rules, 2009
Companies Fresh Start Scheme, 2020

In continuation with the several measures from the Ministry of Corporate Affairs (MCA) during the COVID-19 pandemic, one more major relief has announced by the MCA, vide it's General Circular No-12/2020 dated on 30th March, 2020, through the launching of one-time settlement scheme for the Companies popularly known as “Companies Fresh Start Scheme 2020 (“CFSS-2020”) to grant one-time immunity from hefty fee and prosecution against the defaulting Companies.

This CFSS-2020 has introduced to facilitate the Companies registered in India to make a fresh start on a clean slate by making their defaults good. Under this Scheme, the Companies shall be eligible to complete all their belated filings at a reasonable fee, without any penalty or late fee.

  • Effective Date of the Scheme: This Scheme shall be effective from 01st April, 2020 to 30th September, 2020 in which the defaulting Companies can complete their belated filings (any of the documents, statements, returns etc., including annual statutory documents) by paying the normal statutory fee.
  • Applicability of the Scheme: This Scheme is applicable to all the defaulting Companies, whose belated filings with the Registrar of the Companies (ROC) was due on any given date in accordance with the provisions of this Scheme.
  • Scheme for Inactive Companies: The defaulting inactive companies, while filing due documents under this Scheme can simultaneously apply either for:
    1. declaring themselves as Dormant Company under Section 455 of the Companies Act, 2013 (the Act) by filling Form MSC-1 on MCA
    2. striking off the name of the Company by filing Form STK-2 on MCA
  • Forms which cannot be filed under this Scheme: Except below-mentioned forms, all other forms can be filed under this Scheme:
    1. Form SH-7 (Increased in Authorized Capital),
    2. Form CHG-1 (Creation or Modification of Charge),
    3. Form CHG-4 (Satisfaction of Charge),
    4. Form CHG-8 (Application to C.G for extension of time for creation or modification of charge)
    5. Form CHG-9 (Creation or Modification of Charge for Debentures)
  • Non-applicability of the Scheme: The Scheme shall not apply in the following cases:
    1. The Companies which are strike off and the Companies against which strike-off action has been initiated by the concerned authority;
    2. The Companies who have applied for strike off of its names from the register of Companies;
    3. Amalgamated Companies under the Scheme of arrangement or compromised under the Act;
    4. The Companies who have applied for obtaining Dormant status under Section 455 of the Act, before the commencement of this Scheme;
    5. Vanishing Companies;
    6. Filing of forms SH-7, CGH-1, CHG-4, CHG-8 and CHG-9;
  • Consequential Proceedings under the Scheme: This Scheme protects the Companies from the launching of prosecution or proceedings associated with delay of belated filings with the ROC and shall not cover any other consequential proceedings, including those involving the interest of shareholders or any other person, as being the Company or its directors or Key managerial personnel.

For Example, Immunity shall be provided for delay in filing of Form PAS-3 for allotment of shares and not on account of utilization of money raised through private placement beforethe filing of Form PAS-3 for allotment of shares.

  • Withdrawal of appeal or proceeding initiated: The Companies shall require withdrawing all the appeals filed against the order(s) of any competent court or authority made in the matter of statutory filings against the Company, and submit the proof of such withdrawal along with the application form under the Scheme.
  • Extension of the last date for filing of an appeal: MCA has extended the last date for filing of an appeal under Section 454(6) of the Act, against the adjudication order scheduled in between 1st March, 2020 - 31st May, 2020 to 30th September, 2020. Therefore, the Companies and their officers who have missed the last date for filing an appeal can file the same before the Regional Director till 30th September, 2020.

Further, no prosecution under Section 454(8) of the Act shall be initiated against the Companies by the adjudicating authority, during such extended last date, for the delay in filing of any documents, forms, statements etc., on MCA.

  • Application and granting of Immunity Certificate: The application for immunity can be made after completion of all the belated filings, in the Form CFSS-2020 with no filing fees. However, said the application could not be made after the expiry of 6 (Six) months from the closure of the Scheme. Further, Immunity Certificate shall be granted by the designated authority based on the declaration filed by the Company in Form CFSS 2020.

The designated authority upon the filing of an application in the Form CFSS-2020 shall withdraw all the pending proceedings or adjudications, in the name of the Company and its officers, before the concerned court under Section 454 of the Act, except proceedings or adjudications mentioned as follows:

    1. Immunity shall not be applicable, in cases of the pending appeal and the case of management dispute of the Companies pending before the court of law or tribunal;
    2. Immunity shall not be granted, in cases of (i) conviction order issued by the court; (ii) penalty order imposed by the adjudicating authority for which no appeal could be preferred, before the announcement of this Scheme.
Relief measures introduced by the Ministry of Finance under COVID-19

Due to an increase in the number of COVID-19 positive cases, Prime Minister Narendra Modi had announced a complete lockdown for a period of 21 days on 24th March. The lockdown will last till 14th April 2020. The Officials have also warned all the citizens of India to practice social distancing in order to fight against COVID-19. The Epidemic Diseases Act 1897 has been invoked by the Central and State Governments after being satisfied that the state/country is threatened with the spread of COVID-19 virus. The Finance Minister Nirmala Sitharaman had introduced various relief measures. They are as follows:

Relief package for poor

The Finance Minister Nirmala Sitharaman announced Rs. 1.7 lakh crore relief package for poor people. The main aim was to help the people, who were hit hardest by the COVID-19 lockdown. It was stated that around 800 million people wouldget free grams and cereals along with cooking gas apart from cash through direct transfers for a period of 3 months. The Pradhan Mantri Garib Kalyan Yojana includes higher wages under the Mahatma Gandhi National Rural Employment Act, Rs. 1,000 ex-gratia payment to nearly 30 million poor senior citizens, widows and disabled people. Farmers will get the first installment of Rs. 2,000 under the KisanSamman Nidhi in the first week of April.

The government had increased the wages under the Mahatma Gandhi National Rural Employment Act scheme from the existing Rs 182 to Rs 202. The women who are holding bank accounts under the financial inclusion scheme Jan Dhan will get an ex-gratia amount of Rs. 500 per month for a period of the next threemonths. The government had announced the supply of 5 kg of either rice or wheat and 1 kg of lentil of choice free of cost to poor households every month for a period of next threemonths, in addition to the existing 5 kg of wheat/rice that was announced earlier.  The government had also announced collateral-free loans worth up to Rs 10 lakh for women self-help groups under the DeenDayal Upadhyaya National Rural Mission scheme. The limit which applied to the existing scheme has been doubled to Rs. 20 Lakh.

Medical Insurance cover for healthcare providers

The Union Health Ministry had stated that 22.12 lakh public healthcare providers, including community health workers, will get Rs. 50 lakh insurance cover under a national scheme for them. They will be covered under the Pradhan Mantri Garib Kalyan Package Insurance Scheme for Health workers fighting COVID-19, which was announced by Finance Minister Nirmala Sitharaman on 26th March.

The Central Government has approved the launch of insurance scheme for health workers fighting COVID-19 outbreak. The scheme will be funded through the National Disaster Response Fund budget operated by the Ministry for this purpose.

The Ministry stated that besides, healthcare workers in Government institutions, the insurance scheme will also cover private hospital staff, retired staff, volunteers, contract workers, daily wagers and even outsourced staff hired by the Central government, State governments and autonomous healthcare institutions.

The Ministry stated that the insurance will provide a comprehensive personal accident cover of Rs. 50 lakh for 90 days to a total of around 22.12 lakh public healthcare providers, including community health workers, who may have to be in direct contact and care of patients suffering from coronavirus infection and who may be at risk of being impacted by this.

The actual payment by the insurance company to the beneficiary will be under certification of the authorized Central/State government officials. The order stated that the insurance provided under this scheme would be over and above any other insurance cover being availed by the beneficiary.

Relief package for the organized sector

The Centre had stated that it will pay Employees Provident Fund contribution on behalf of both the employee and the employer for a period of three months for individualsmall companies. The government had stated that the companies with up to 100 employees in which 90 per cent of the staff is paid less than Rs 15,000 per month wouldbe entitled to receive the benefit. The government will also permit withdrawals of up to 75% of non-refundable advance or three months of wages from the Employees Provident Fund account, whichever is lower.

Reliefs under Income tax

The government has extended the deadline for filing tax returns by three months. The last date for income tax returns for Financial Year 2018-2019 has been extended to 30thJune 2020, and for the delayed payments the interest rate has been reduced to 9% from 12%.

The mandatory linking of Aadhaar cards with PAN cards and the direct tax Vivad se Vishwas scheme has also been extended to 30th June 2020.In Vivad Se Vishwas scheme, the earlier criteria of not paying a 10% additional amount till March 31 was extended to June 30.

For delayed payments of advance tax, self-assessment tax, regular tax, TDS and equalization levy, among others, made between 20th March and 30th June, the interest rate has been reduced to 9% from 12-18% earlier. No late fee and penalty shall be charged for delay relating to this period.

The assesses and/or the tax authorities have got an extended time limit of up to 30th June 2020 where the time limit for the following compliance matter expires between 20th March 2020 and 29th June 2020:

  • Issue of notice/intimation/notification/approval order/sanction order
  • Filing of an appeal/furnishing of a return/statements/reports or any other documents
  • The time limit for the completion of proceedings by the tax authority
  • Investment in saving instruments or investments for rollover benefit of capital gains under the Income Tax Act, Wealth Tax Act, Prohibition of Benami Property Transaction Act, Black Money Act, STT law, CTT Law, Equalization Levy law, and the Vivad Se Vishwas law

Reliefs under Custom Act

The government had stated that the Customs Clearance shouldbe made available on 24*7 basis till 30th June 2020. The time limit for any compliance under the customs act and other allied laws has been extended to 30th June 2020.

Reliefs under GST Act/ Indirect Tax

  • The last date to avail the Saba Vishwas scheme is extended to 30th June 2020. No interest for this period shall be charged if paid by 30 June 2020.
  • The due date of filing GST annual returns for the Financial year 2018-2019 has been extended to 30thJune 2020.
  • The Last date for filing GSTR-3B in March, April and May 2020 will be extended till the last week of 30 June 2020 for those taxpayers who are havingaggregate annual turnover less than Rs. 5 Crore. There will be no interest, late fee, and penalty to be charged. The same benefit to be available for taxpayer having aggregate turnover of more than Rs. 5 crores with an exception that interest at the rate of 9% p.a. will be charged instead of 18% p.a. and the reduced interest rates will apply for tax payments made between 20th March 2020 and 30th June 2020.
  • The Date for opting for composition scheme is extended till the last week of June 2020.
  • The due date for issue of notice, notification, approval order, sanction order, filing of the appeal, furnishing of return, statements, applications, reports, any other documents, or time limit for any compliance under the GST laws where the time limit is expiring between 20thMarch 2020 to 29thJune 2020 shall be extended to 30 June 2020.


The Government of India is taking all the necessary steps in order to prevent the spread of COVID-19 infection among the citizens of India. All the citizens must take precautions as per the advisories that are being issued by the Ministry of Health and Family Welfare. These are the testing times for the country, and we all can do our best by co-operating with the government.

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