Press Information Bureau

Government of India

Ministry of Corporate Affairs

22-November-2012 18:09 IST

Companies Act, 1956 is a voluminous legislation under which companies are required to make large number of disclosures and meet many procedural requirements as provided I the Act. Scrutiny of filings of companies to detect technical violations of the Act in such cases is carried out on a regular basis by Registrars of Companies all over the country and action for non-compliance is largely in the form of collection of additional fee and compounding fee. In more serious cases enquiry/inspection/investigation are carried out and cases of violations result in prosecutions. During the last three years (2009-12) such prosecutions have resulted in 8186 convictions.

This was stated by the Minister of State for Corporate Affairs (I/C) Shri Sachin Pilot in written reply to a question in the Lok Sabha today.

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Companies Act compliance prompts routine scrutiny and fees, with serious non compliance leading to inquiry and prosecution. Companies Act compliance under the Companies Act, 1956 is routinely scrutinised by Registrars of Companies to detect technical violations; non compliance is typically remedied by collection of additional fees and compounding fees, while serious breaches are pursued through inquiry, inspection and investigation and may lead to prosecution.