Govt. Set up team to resolve MCA21 Portal Glitches; New system is part of a Revamp Statutory Filing

Finance Minister Nirmala Sitharaman has directed the ministry of corporate affairs to form a special team to look into public grievances arising due to glitches in the MCA21 portal on priority, after conducting a review.

The FM recognised that several MCA21 site users had reported technical challenges throughout the filing process after the release of new forms in version 3.

The most recent version was released on January 23. The FM stated in a tweet that the corporate affairs ministry is working to resolve the issue with Larsen and Toubro’s LTIMindtree, which operates the portal, consultants EY India, and the National Institute for Smart Government.

The government is also seeking input from chartered accountants and company secretaries’ professional groups.

According to a government official, there are teething problems with the new system, but they will be remedied soon. The official further stated that since MCA has made the registration procedure more stringent, requiring everyone who registers to submit a PAN and validate digital signatures, it has exacerbated their challenges.

“You can no longer have numerous userIDs linked to the email address of an unknown organisation. We have taken steps to prevent the formation of shell businesses. This is causing issues for some,” an official stated.

The government has moved approximately 85 forms to the new MCA21 portal. Once the system is stabilised, some 40 more forms will be transferred to the new platform, according to the senior official.

The new version 3 is a data analytics-driven system that is designed to not just make filings for the companies easier but also enable early detection of lapses in filings.

The Ministry of Corporate Affairs has simplified the corporate reporting process, eliminating the need for approval by Registrars of Companies (RoCs) in most cases and allowing companies to fulfil their reporting obligations with an online acknowledgement, according to two people familiar with the development.

The new mechanism, called “file and forget” by policymakers, is part of the government’s ongoing redesign of the statutory filing website, MCA21, one of the two sources listed above said, seeking anonymity. Businesses can now satisfy the majority of their statutory filing responsibilities with an online acknowledgement, which is equal to RoC clearance.

In January, 56 of the nearly 100 forms that companies must file as part of their compliance obligations under the Companies Act on various transactions and filing obligations related to statutory requirements were migrated to a new web-based version, and an additional 30 web-based forms will be launched soon.

“Of them, the majority of the key ones, such as allotment of securities or shares, are now free of RoC approval requirement. Online acknowledgement is sufficient, and they are recorded as part of an auto-approval procedure. “With the exception of a handful, most paperwork filed by corporations used to go to RoCs for approval,” remarked the first person mentioned above.

Similarly to the income tax department‘s centralised processing centre in Bengaluru, the ministry is establishing a centralised processing centre for business filings under the Companies Act.

An email addressed to the ministry of corporate affairs on Friday requesting comments for the story went unanswered as of publication.