More businesses face regulatory heat on beneficial ownership
New Delhi: The regulatory scrutiny on beneficial ownership of companies is increasing with the Registrars of Companies (RoCs) issuing adjudicatory orders on as many as 20 companies since the beginning of May, suggesting that the authorities are getting stricter about disclosures of who is controlling corporate operations. If the orders issued since beginning of the year are taken into account, the figure goes up to 27. In all but three cases, penalties were imposed and in these three cases, the submissions made by the companies were accepted, showed the regulatory orders available from the ministry of corporate affairs.
The trend shows that RoCs are digging deep on various regulatory filings of the companies not only in India but also those made to overseas regulatory agencies that are publicly available. Experts advise companies to make sure they identify persons who have significant beneficial ownership in them, prompt them to make disclosures and file those with the RoCs to avoid getting penalised. In June and July alone, orders were issued in the case of 12 companies.
These include HeroX Pvt. Ltd, YSK Developers Pvt. Ltd, Khvatec India Pvt.
Ltd, Aries Hotels Pvt. Ltd, Finar Ltd, Samsung SDI Pvt. Ltd and Samsung Display Noida Pvt.
Ltd. Queries emailed to the companies on 16 July seeking comments for the story remained unanswered at the time of publishing. Regulatory provisions require those holding at least 10% of beneficial interest in the shares of companies individually or with others, or exercise significant influence or control over the company in terms of appointment of directors or in management decisions, have to declare the same and the companies have to report the same to the RoCs.
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