RoCs keep regulatory heat on companies; 284 businesses faced orders since January
₹four crore and ₹40 crore respectively, are eligible for penalty at half the rate applicable for the others, under a concessional provision meant for small businesses. However, not filing annual financial statements would mean the authorities will not be in a position to offer this concession, showed the orders. D Nagendra Rao, former president of The Institute of Company Secretaries of India (ICSI) said that in many cases, companies approach the RoCs on their own for compounding of offences where they see a gap in compliance.
When companies voluntarily apply for adjudication orders in such cases, the penalty levied may not go up to the maximum level specified in the law, said Rao. It is a good idea for small companies that are not mandated to have a full time company secretary, to have an annual compliance ‘health check’ in secretarial matters by an external professional, explained Rao. The steady rise in adjudication orders coincides with the increased automation and the adoption of ‘file and forget’ or straight through process adopted in corporate filings as part of the ongoing upgrade of the MCA21 statutory filing system.
For most of the corporate reporting, now an online acknowledgement from the system is enough. With this, RoCs are now able to focus more on substantive inspections and investigations. A person informed about the ongoing technology upgrade of the MCA21 system said that after the national polls, the next phase of upgrade will be executed.
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