Know your Ministry - No. 11 - Corporate Affairs

Minister of Finance also heads the Ministry of Corporate Affairs. The Ministry is primarily concerned with administration of the Companies Act 2013, the Companies Act 1956, the Limited Liability Partnership Act, 2008, Competition Act, 2002 & other allied Acts and rules & regulations framed there-under mainly for regulating the functioning of the corporate sector in accordance with law. It also exercises supervision over the three professional bodies, namely, Institute of Chartered Accountants of India(ICAI), Institute of Company Secretaries of India(ICSI) and the Institute of Cost Accountants of India(ICMAI) for proper and orderly growth of the professions concerned. It is also entrusted with the responsibility of carrying out the functions of the Central Government relating to administration of Partnership Act, 1932, the Companies (Donations to National Funds) Act, 1951 and Societies Registration Act, 1980. ACTS, RULES, CIRCULARS AND RELATED AMENDMENTS & NOTIFICATIONS Companies Act, 2013, Limited Liability Partnership Act, 2008, Insolvency & Bankruptcy Code, 2016, Competition Act, 2002, Partnership Act, 1932, Chartered Accountants Act, 1949, Cost & Works Accountants Act, 1959, Company Secretaries Act, 1980, Societies Registration Act, 1860, Companies (Donation to National Fund) Act, 1951, Accounting Standards

SERVICES OFFERED:

• Digital Signature Certificate (DSC) Services, Director Identification Number (DIN) Services, Master Data, LLP Services, LLP Services for Business Users, eFilling, Company Services, Complaints, Document Related Services, Investor Services, ID Databank Services.
• DATA & REPORTS: Annual Report (March 2018), Report on Nidhi Companies(2000),Monthly Newsletters (Aug 2020), Monthly Information Bulletin on Corporate Sector(Aug 2020), Annual Report on Costs & Prices 2016-17, Committee Reports, Company LLP Information & Company Statistics.

CHALLENGES BEFORE THE MINISTRY

1. Scrutinize the genuine credentials of all firms and companies registered with ROC.

2. Weeding out all inactive and non-compliant companies from the list of Registrar of Companies.

3. Identify and take stringent legal action against all firms that were found not to have been carrying out any business for a long time, and also not filing annual financial returns for the more than three years.

4. Curbing the flow of black money, money laundering and terror funding by scrutinizing the transactions of directors involved in the role of operations and functioning in blacklisted companies with due co-ordination with enforcement agencies.

5. Effective scrutiny and role of professionals such as chartered accountants, Cost Accountants and Company secretaries who associated with blacklisted firms.

 6. Rooting out all Corporate Benami properties and help creation of a transparent and robust system.

WAY FORWARD

 1. To deploy latest technologies in its system for scrutinising the accounts and transactions of all active companies through Artificial Intelligence (AI). Ministry can develop an early warning system is being developed which will send signals if there is any heightened activity or any fraudulent financial activity detected in the registered firms.

2. To make suitable statutory obligations in order to strengthen the corporate structure and governance enabling proper administration of companies. This would increase confidence of domestic as well as foreign investors.

3. To identify all the movable assets and immovable properties of Struck Off companies and restrict the transfer of such assets till these companies are restored in a time-bound manner.

4. Remove all the legal impediments for speedy enforcement of Insolvency & Bankruptcy Code.

5. Enhance the quality of Audit by professionals by bringing them in a Common Framework under the direct supervision of the respective Apex bodies or Institutions governing professional conduct in terms of integrity and exercise of due diligence and compliance.

6. Evaluation of the Litigation disposal efficiency of the Principal and Regional Benches of National Company Law Tribunals set up across the country.

7. To revisit the existing legislations that failed to prevent to protect the interests of Financial Institutions to due persistent flaws and loopholes in the laws.

8. Explore formation of State Company Law Tribunals in every State Capitals of the country.

9. To develop a robust, transparent and accurate Management Information System(MIS) and deploy Business Intelligence tools to capture a real-time technology-driven process for analyzing data and delivering actionable information that helps efficient and effective governance.

10. To strengthen the supervision of all the three professional bodies (ICAI, ICSI & ICMAI)