Economy

Published: May 27, 2023
Updated: May 27, 2023

MCA V3 Portal Plagued by Glitches and Inefficiencies, Causing Chaos for CAs and Startups : Ease of Doing Business a Far fetched Dream

The Ministry of Corporate Affairs' (MCA) MCA 21 portal, aimed at streamlining compliance and enforcement of legal requirements, has come under fire from Chartered Accountants (CAs) and company secretaries. The latest version, V3, has been plagued with technical glitches, leading to significant challenges and delays in crucial processes such as company formation. The grievances raised on social media platforms have highlighted the growing frustration among professionals and startups, as the website malfunctions continue to impact their operations negatively.

Technical Glitches Hamper Essential Functions:

The MCA 21 portal, an e-Governance initiative, was initially designed to simplify access to MCA services. However, the automation introduced in V3 has proven counterproductive for company secretaries, making routine filings more challenging than ever. Numerous complaints have emerged, pointing to technical glitches causing problems with form submission, document uploading, and certificate retrieval. The delays and complications have resulted in penalties and disrupted the functioning of company secretaries, severely affecting their ability to serve businesses effectively.

Version 3 Amplifies the Issues:

While the previous version of the MCA21 portal also had its share of problems, the introduction of V3 has intensified the complaints. Since January 2023, when additional compliance-related filings were shifted to V3, the number of grievances skyrocketed. Startups, especially those backed by venture capitalists, faced significant hurdles due to the malfunctioning portal. The formation, closure, and conversion of companies, as well as the acquisition of Director Identification Numbers (DIN), experienced extensive delays.

Government's Response and Persisting Challenges:

Finance Minister Nirmala Sitharaman took note of the complaints in February and established a special team to address public grievances promptly. Helpdesks were set up, and a dedicated Twitter handle was launched to handle the concerns. Despite these measures, the issues remain largely unresolved. Many complaints raised in February have remained open for months without a satisfactory solution. The government acknowledges the technical glitches but categorizes them as "teething issues" that will be resolved soon. However, the prolonged duration of unresolved problems raises doubts about the effectiveness of these assurances.

Impact on Professionals and Institutions:

Company secretaries and CAs have been severely impacted by the malfunctioning MCA 21 portal.Professional institutions like the Indian Institute of Chartered Accountants (ICAI) and Indian Institute of Company Secretaries have actively raised concerns and advocated for deadline extensions and penalty waivers in cases where technical glitches have caused delays. However, the ongoing extensions cannot be a permanent solution.

Grim outlook - Looking Ahead:

The Ministry of Corporate Affairs plans to migrate more forms to the V3 portal in the coming months. Unless the existing issues are effectively resolved, the future may witness an increase in complaints and frustrations. The government is reportedly engaged in regular meetings with the teams responsible for the portal's management to address the glitches. However, the lack of a concrete resolution thus far leaves many professionals skeptical. The MCA needs to take immediate action to rectify the website's flaws, ensuring a smooth and efficient experience for CAs, company secretaries, and startups.