complaint

In this blogpost, Nupur Trivedi, Advocate, Practising in Trial Courts & High Court and a student of the Diploma in Entrepreneurship Administration and Business Laws by NUJS, writes about, who is a registrar, functions of ROC, Powers of ROC, who can file a complaint to ROC and the procedure to file a complaint.

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Who is a registrar

The registrar is defined under Section 75 of Companies Act 2013, under which the term“Registrar” means a Registrar, an Additional Registrar, a Joint Registrar, a Deputy Registrar or an Assistant Registrar, having the duty of registering companies and discharging various functions under this Act.

Functions of ROC

Registrars of Companies (RoC) appointed under Section 396 of the Companies Act, 2013 covering the various States and Union Territories are vested with the primary duty of registering companies incorporated in the respective states and the Union Territories. The Central Government exercises administrative control over these offices through the respective Regional Directors (RD). The Regional Directors (RD) are in-charge of the respective regions, each region comprising a number of States and Union Territories.[1]

RoC issues an incorporation certificate to the companies. The RoC offices function as registry of records, relating to the companies registered with them, which are available for inspection by members of public on payment of the prescribed fee. The registered documents are made available to the Shareholders, Investors and the General public at large through an online portal MCA21 at a payment of nominal fee.

But the role of RoC is more than that of a mere registry office; it is also entrusted with the responsibility to ensure compliance with all statutory requirements under the Companies Act by the incorporated companies, for instance, periodic filing of Annual Returns and Balance Sheets, Change of directorship of the company etc.

Powers of ROC

All incorporated companies functioning in India will have to abide by all statutory requirements of Companies Act and it is the duty cast on the office of the Registrar of Companies to ensure that all norms are followed and that any violations are brought to books. The RoC has the power to take action against companies that fail to submit requisite documents in time or for the production of incorrect/incomplete information.

The RoC also has suo-moto powers to order for inspection of companies and if deemed necessary, investigation can also be carried out and all violations can be brought to book and both civil and criminal prosecution would be initiated.

The powers of inspection, inquiry and investigation by the RoC are elaborated under Sections 206-209 of the Companies Act, 2013. The powers enjoyed by the RoC under the Act are stated hereunder in brief: –

  • Powers under Section 206 to call for information, inspect books and conduct inquiries– This section corresponds to Section 234 of the Old Act. Under this section, the Registrar can call for information or explanation or any further documents from a Company on the basis of scrutiny of a document submitted by a company or on information received by the Registrar. The Registrar can send a written notice to the company demanding for an explanation or information in writing or production of documents by the company within the time prescribed in the notice.
  • Power of inspection of books of account, books, papers and explanations by Additional written notice under Section 206 (3)- Under this sub-section the Registrar can send an additional written notice in three circumstances; firstly if the company fails to furnish the information or explanation required within the time specified in the notice; secondly if the Registrar is of the opinion that the information or explanation furnished is inadequate; and thirdly and most importantly if the Registrar is satisfied on scrutiny of documents furnished that the manner in which the company is run is fishy and the information or documents furnished do not disclose a full and fair statement of the information required. Hence, if any of the above said grounds exist, then the Registrar can exercise the power of inspection specified under the said sub-section 3 of Section 206 by sending an additional written notice to the company and recording his reasons for doing so, in writing.
  • Power of Inquiry under Section 206 (4)- If the Registrar is satisfied on the basis of information available with or furnished to him or on a representation made to him by any person that the business of a company is being carried on for a fraudulent or unlawful purpose or not in compliance with the provisions of the Companies Act or if the grievances of investors are not being addressed, the Registrar may, after informing the company of the allegations made against it by a written order, call on the company to furnish in writing any information or explanation on matters specified in the order within such time as he may specify therein and carry out such inquiry as he deems fit after providing the company a reasonable opportunity of being heard.

It is important to note here that under this Section any person can make a representation to the Registrar and complaint against the state of affairs of the company.

  • Powers as Civil Court under Section 207 (2) & (3)- The Registrar is vested with the powers of the Civil Court for conducting inspection and inquiry under Section 206. The registrar can call for discovery and production of books of account and other document, summon and enforce the attendance of persons and examine them on oath and inspect any books, registers and other documents of the company at any place. Hence, the Registrar has been given ample powers to inquire and inspect into the affairs of a company, about which he has grounds to believe, is not working in accordance with the provisions of the Companies Act.
  • Report to Central Government under Section 208- After conducting an inquiry under Section 206 and inspecting documents under Section 207, if the Registrar is of the opinion that a further investigation is required into the affairs of the company then he can make a report and submit to the Central Government along with the requisite documents recommending for further investigation. The Central Government then appoints inspectors for carrying out an investigation against such company.
  • The power of Search and Seizure under Section 209- Registrar has the power to search premises and seize any books and papers after obtaining an order from the Special Court for the same.

Who can file a complaint to RoC?

As already stated above that under sub-sec. (4) of Section 206 of Companies Act, 2013, a representation can be made by “any person” alleging that the business of the company is being carried on for a fraudulent or unlawful purpose or not in compliance with the provisions of this Act or the grievances of investors are not being addressed.

Under sub-sec. (1) of Section 206 also, the RoC sends out a written notice to a company on the basis of “any information” received by him. Hence, the RoC has the power to carry out an inquiry into such allegations irrespective of the identity of the person complaining against the company. The only requisite is that of the satisfaction of the Registrar; he should be satisfied that such furnishing of information/ explanation or inquiry is necessary.

The provision in the Old Act corresponding to sub-sec. (4) of Section 206 of the New Companies Act is Section 234. Sub-section (7) of S. 234 stated that the representation to the Registrar was to be made by “any contributory or creditor or any other person interested”.  Earlier such “interested person” had to furnish information to the Registrar representing that the business of a company is being carried on in fraud of its creditors or of persons dealing with the company or otherwise for a fraudulent or unlawful purpose.

However, the New Act does not impose any such restriction. Therefore, any person can furnish information regarding the misdealing, fraud or non-compliances by the company to the Registrar. That person can be absolutely anybody, from the employee, director, creditor, investor to the client of the company. It is not necessary that the complainant has to be an interested person or a person dealing with the company only.

Procedure to file a Complaint to the RoC ?

There is no specific format of a complaint to the RoC in the Companies Act. It has to be formal and stating all material facts in an elaborate manner. The complaint should be addressed to the RoC of the respective state where the company is incorporated.

The complaint should include the name of the company complained against and its full registered address. The complaint may contain the names of all the officials or agents of the company, such as CEO, Directors, Managing Directors or authorized signatories who may be responsible for the state of affairs of the company.

The relevant documents in photocopy may be enclosed along with the complaint. On receipt of such information if the RoC is satisfied that the business of the company is not carried on in accordance with the provisions of the Companies Act then it will take adequate steps under Sections 206-209 of the Companies Act, 2013 to initiate an inquiry against the defaulting company.

An example of the manner in which complaint can be filed is given below:-

By Regd post with A.D.

Date: ______

To,

The Registrar of Companies

10/499 B, Allenganj,

Khalasi line

Kanpur (U.P.) -208002

Subject: Complaint against XYZ Company Ltd.

Sir,

Under instructions from my client, ABC Pvt. Ltd, I file a complaint against XYZ Co. Ltd having its Registered Office at B-4, Georgetown, Allahabad, U.P., in the following manner:-

  1. That, my client and XYZ Co. Ltd had business relations. My client supplied goods worth Rs. 5 crore to XYZ Co. Ltd in the month of September,
  2. That, …………………..

Therefore, I request you to initiate an investigation into the affairs of XYZ Co. Ltd and protect the interest of my client who is likely to be defrauded due to acts of the agents and officials of XYZ Co. Ltd.

Kindly do the needful.

Thanking you,

Yours sincerely,

KLM

For ABC Pvt. Ltd

[1] Ministry of Corporate Affairs Website, http://www.mca.gov.in/MinistryV2/rd.html.

3 COMMENTS

  1. gentlemen,

    i just want to clarify the following queries with the sections by company act so that i can get the clarity whether it is advisable to go for filing complaint against a company please.
    1.Is this mandatory to intimate the ROC if a company director booked on a criminal case where he was taken to custody by the court and after taking bail the director is released on providing surety to the satisfaction of the court?
    2. if the indian company gets associated with a foreign company and if that foreign company gets closed for obvious reasons,will this to be intimated to ROC?
    3. If the MCA publish an article stating that the company is involved depositing the cash worth of hundreds of crores after demonetization and they don’t have any further details of the company and if i provide the vital information about such company will ROC can take action against that company which is already been investigated by SFIO but nothing concluded?
    4. If the company is declared as a shell company by MCA and will that company has a locus standi to participate in PPP projects, availing big loans from financial institutions being a confirming party?

    regards

  2. I want to file a complaint against GALAXY FOOD AND CHEMICALS (P) LTD. whose regn o.is 095884 , and CIN NO.IS:: UP15100UP2017PTC095884 , I HAVE ALSO FILED A CASE IN MSEFC -CASE NO.= UP43A0030459/M/00002 , ON 22/03/2020 AGAINST RICHA BAJPAI PHONE NUMBER 9554433269 , I WAS SUPPLYING ACID SLURRY TO THIS COMPANY AND THIS COMPANY HAS HOLD MY Rs.985509/= plus compound interest @18% as applicable under msme act., I have also done speed post to all the five directors with enclosing all three years ledger copy (17-18) , (18-19) , (19-20) , and full calculation of interest that amounts to 487393/= so total is Rs.14,72,902=26 only.. now the directors of the company are giving threats to me for not giving my amount and not demanding through any government site also , please let me know what to do in this case..I AND MY FAMILY MEMBERS ARE REALLY AT HIGH RISK DUE TO THIS TYPE OF UNLAWFUL AND MIS-BEHAVIOUR FROM GALAXY FIRM..AND ITS DIRECTORS..

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