Ministry of Corporate Affairs

Action initiated to control fraudulent companies

The term ‘Fraudulent Company’ is not defined in the Companies Act, 2013. However, Ministry of Corporate Affairs (MCA) through the Registrar of Companies (ROC) CRC at Manesar registers new companies by following due process of law.

This was stated by Shri Anurag Singh Thakur, Union Minister of State for Finance & Corporate Affairs, in a written reply to a question in Rajya Sabha today.

The Minster stated that in order to simplify the process of registration of new companies, MCA had taken various steps such as SPICe form was introduced to reduce the procedures, time and cost required for incorporation of a company to great extent. Since 23rd February 2020, the SPICe form has been replaced by a new generation integrated incorporation form christened SPICe+ web form which offers 10 services by three Central Government Ministries, the Maharashtra State Government and six public & private sector Banks, thereby reducing the number of procedures required to start business in India.  MCA has been implementing a holistic end-to-end e-Governance project named ‘MCA21’ for discharging its statutory functions since March, 2006 to bring transparency, speed and efficiency in the functioning of the Government.

Giving more details, the Minister said, MCA is aware of the corporate frauds reported in the last five years. Based on the complaints, investigations have been ordered from time to time against the companies which were allegedly involved in fraud and assigned to Serious Fraud Investigation Office (SFIO) and Regional Directors (RDs). The details of number of companies against whom Investigations ordered and assigned to SFIO and RDs during the last 5 Financial Years are as under:

Financial year No. of investigations ordered and assigned to SFIO No. of investigations ordered and assigned to RDs
No of Cases No of Companies No of Cases No of Companies
2015-16 21 184 3 3
2016-17 25 111 2 2
2017-18 22 226 52 117
2018-19 33 414 27 126
2019-20 26 326 33 100

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