Violation of provisions of Company Law by Companies and action taken by MCA.
Today, Union Minister of State for Finance & Corporate Affairs, in response to a written question in the Lok Sabha informed about the action taken by the MCA on companies that have violated the provisions of the Companies Act 2013.
It was informed that MCA either directly or through Regional Directors (RDs)/ Registrar of Companies (ROCs) receive complaints against companies from public (Individual/entities), from other Ministries etc., which are examined and action is taken as per the provisions of the Companies Act, 2013 which includes ordering and conducting Inquiries, Inspections or Investigations.
Where the complaints are of such nature involving fraud which require multi-disciplinary action, where large public interest and huge money transactions are involved are assigned to the Serious Fraud Investigation Office (SFIO) by the MCA.
As per the reply, details of Inquiries/Inspections/Investigations ordered during last two years from 2018-19 and 2019-20 were as under:
| Section | Nature of violation | No. of Inquiries/ Inspection/ Investigation ordered |
| 206(4) | Business of a company carried on for a fraudulent or unlawful purpose or not in compliance with the provisions of the Companies Act | 878 |
| 206(5) | Circumstances warrant a direct inspection of books and papers of a company by an inspector | 674 |
| 210 | Investigation into affairs of the company on receipt of a report of ROC or on special resolution passed by a company requesting investigation or in public interest, or on order by a court or the Tribunal | 167 |
| 212 | Investigation into Affairs of Company by Serious Fraud Investigation Office | 59 |
The House was informed that the reasons for ordering Inquiries/ Inspections/ Investigations varies from case to case such as frauds, non-compliance of the provisions of the Companies Act, non-refund of deposit received from public under the Companies Act, complaints received from other Ministries, Forwarding the complaints filed by the banks on borrowings by the companies and on the basis of orders of Hon’ble Court/Tribunal.
It was also informed that in 660 number of cases enquiry has been conducted. Based on the findings, prosecutions are filed under the provisions of the Companies Act, 2013.
Dividing total turnover by 365 days and concluding that assessee could not have made such cash sale on a single…
NERIST Arunachal Pradesh invites EoI for Empanelment of Chartered Accountant firm North Eastern Regional Institute of Science and Technology, (NERIST)…
Sibsagar University invites Expression of Interest (EOI) for Appointment of Internal Auditor Sibsagar University invites Expression of Interest (EOI) from reputed…
In a recent judgment Andhra Pradesh High Court struck down Section 147A of the Income Tax Act, 1961 as unconstitutional.…
Bank was liable to pay compensation to borrower as it did not verify the progress of construction before loan disbursals…
No timeline mentioned in PMLA to forward the arrest order and the material in possession to the Adjudicating Authority. It…