Lok Sabha Question No. 6502 (UNSTARRED), answered on 2018-04-06
Subject: Mandatory Registration of Companies
Ministry: CORPORATE AFFAIRS
Asked by: KAMLA DEVI PATLE

## GOVERNMENT OF INDIA

## MINISTRY OF CORPORATE AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO. 6502 ANSWERED ON FRIDAY, THE 06 TH  APRIL, 2018 [CHAIRTA 16, 1940 (SAKA)]

## MANDATORY REGISTRATION OF COMPANIES QUESTION

## 6502. SHRIMATI KAMLA DEVI PAATLE:

## Will the Minister of CORPORATE AFFAIRS be pleased to state:

- (a) whether  a  large  number  of  bogus  companies  are  functioning without  registration  with  the  Registrar  of  Companies  (RoC)  in  the country including Chhattisgarh particularly in the rural areas and if so, the details thereof, State-wise;
- (b) whether it is mandatory for any company to get registered with the RoC within a certain time period and if so, the details thereof; and
- (c)  the  details  of  the  action  taken  against  such  erring  companies during the last two years and the current year, year/State-wise?

## ANSWER

## THE MINISTER OF CORPORATE AFFAIRS            (SHRI ARUN JAITLEY)

(a) to (c): The  term  'Bogus  Company'  is  not  defined  under  the Companies  Act,  2013.  Section  453  of  the  Companies  Act,  2013 prescribes the punishment for in proper use of 'Limited' or 'Private Limited' whereby if any person or person trade or carry on business under any name or contraction or imitation thereof is or are the last word or words, that person or each of those persons shall, unless duly incorporated with limited liability,  or unless duly incorporated as a private company with limited liability, as the case may be, punishable with fine which shall not be less than five hundred rupees but may extend to two thousand rupees for every day for which that name or title has been used.

During the last three years, following unregistered companies have come to the notice of this Ministry against whom action has been taken as under:

|   Sl. No. | Name of unregistered companies         | Jurisdictional Registrar of Companies   | Action against unregistered companies                                                                                                                                                    |
|-----------|----------------------------------------|-----------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|         1 | Krishi Vipran Vikas Ltd.               | Kanpur                                  | Prosecution u/s 453 of the Companies Act, 2013 has been launched.                                                                                                                        |
|         2 | Bhagya Laxmi Financial Private Limited | Delhi                                   | The Reserve Bank of India has intimated that it has taken up the matter with the then Department of Electronic and Information Technology (DEITY) (now a Ministry) to close the website. |
|         3 | Natraj Finance                         | Delhi                                   | An FIR has been filed on 22.03.2017 by the Registrar of Companies, Delhi.                                                                                                                |
|         4 | Webtern India Pvt. Ltd.                | Pune                                    | Prosecution u/s 453 of the Companies Act, 2013 has been launched on 12.05.2017 vide Case No.14969/2017.                                                                                  |
|         5 | Tanishka Infotech Pvt. Ltd.            | Pune                                    | The case has been referred to the State Economic Offence Wing (EOW) on 06.10.2016.                                                                                                       |

Section 9 of the Companies Act, 2013 provides for the effect of registration, which inter-alia, states that from the date of incorporation  mentioned  in  the  certificate  of  incorporation,  such subscribers to the memorandum and all other persons, as may, from time  to  time,  become  members  of  the  company,  shall  be  a  body corporate  by  the  name  contained  in  the  memorandum,  capable  of exercising all the functions of an incorporated company under this Act and  having  perpetual  succession  with  power  to  acquire,  hold  and dispose  of  property,  both  movable  and  immovable,  tangible  and intangible, to contract and to sue and be sued, by the said name.

Therefore, the capacity to exercise all functions of an incorporated  entity  under  this  Act  only  ensue  on  the  date  of incorporation, to such extent registration is mandatory from inception.

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