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Physical Verification of The Registered Office of The Company

The MCA vide notification dated 18/08/2022 has notified Companies (Incorporation) Third Amendment Rules, 2022 to insert a new rule in Companies (Incorporation) Rules, 2014, which pertains to physical verification of the registered office address of the Companies.

This rule 25B is added to make the existing sub-section (1) and sub-section (9) of section 12 fully functional. Following new rule 25B shall be inserted after the existing rule 25A.

Existing provisions of sub-section (1) of section 12  

A company shall within thirty days of its incorporation and at all times thereafter, have a registered office capable of receiving and acknowledging all communications and notices as may be addressed to it.

Existing provisions of sub-section (9) of section 12 

If the Registrar has reasonable cause to believe that the company is not carrying on any business or operations, he may cause a physical verification of the registered office of the company in such manner as may be prescribed and if any default is found to be made in complying with the requirements of sub-section (1), he may initiate action for the removal of the name of the company from the register of companies.

Author’s Opinion regarding the effects of the newly added Rule 25B

If the ROC has a reason to believe which is reasonable on the grounds that the company is not engaged in any type of business or operations or does not have an updated registered office or correspondence address that is able to receive and acknowledge all communications and notices for any reason, the ROC may request a physical inspection of the address provided by the company.

After performing physical verification, ROC will send a notice to the company and all of the Directors outlining the implications of removing the company’s name from the Registrar if they believe that the company is incapable of receiving and acknowledging all communications and notices that may be addressed to it.

Prior to removing the company’s name from the registrar, the ROC will give the conflicting party a reasonable opportunity to be heard. It may also permit the conflicting party’s authorized representatives to submit statements or documents within 30 days of receiving the notice, after which the company may be struck off under Section 248 of the Act.

The MCA’s amendment will provide ROCs the unrestricted right to physically check the registered office address of any company that has registered with the MCA. Despite the fact that sub-section (9) of section 12 was added by the Companies (Amendment) Act, 2019, it was not completely effective because it lacked the necessary provisions. However, as a result of this amendment, ROCs are now free to independently verify the registered office addresses of companies that they suspect of being inactive and to bring legal action under sub-rule (5) of rule 25B in cases where the registered office is found to be unable to receive and acknowledge all notices and communications.

This action will stop the practice of providing fictitious addresses or non-operational office addresses and decrease the likelihood of justifications relating to the non-reception of notice or documents, etc. Stakeholders such as banks, creditors, or other governmental authorities, etc. will be able to reach the Company’s authenticated registered office or correspondence address or send the communication or notice to the Company in a timely manner.

New Rule 25B. Physical verification of Registered Office of company

1. The Registrar, based upon the information or documents made available on MCA 21, shall visit the address of the registered office of the company and may cause the physical verification of the said registered office for the purposes of sub-section (9) of section 12, in presence of two independent witnesses of the locality in which the said registered office is situated and may also seek the assistance of the local Police for such verification if required.

2. The Registrar shall carry the documents as filed on MCA 21 in support of the address of the registered office of the company for the purposes of physical verification and to check the authenticity of the same by cross verification with the copies of supporting documents of such address collected during the said physical verification, duly authenticated from the occupant of the property whereat the said registered office is situated.

3. The Registrar shall take a photograph of the registered office of the company while causing physical verification of the same.

4. The report of the physical verification shall be prepared in the following format namely:

    • Name and CIN of the company:
    • Latest address of the registered office of the company as per MCA 21 record:
    • Date of authorization letter issued by the Registrar of Companies:
    • Name of the Registrar of Companies:
    • Date and Time of Visit for physical verification of the registered office:
    • Location details along with Landmark: Details of the person available if any at the time of the visit-
    • Name:
    • Father’s Name:
    • Residential address:
    • Relationship with the company, if applicable:
    • Remarks if any:
    • Documents attached:
    • Copy of the agreement/ownership/rent agreement/No Objection Certificate of the registered office of the company from owner/tenant/lessor:
    • Photograph of the registered office: Self-Attested ID – Card of the person available, if any:
  • Any other document(s):

5. Where the registered office of the company is found to be not capable of receiving and acknowledging all communications and notices, the Registrar shall send a notice to the company and all the directors of the company, of his intention to remove the name of the company from the register of companies and requesting them to send their representations along with copies of relevant documents, if any, within a period of thirty days from the date of the notice before taking further actions in accordance with the provisions of section 248 of the Act.

For any type of assistance feel free to contact or reach us at: – MG Associates (Company Secretaries)- CS Manisha Mittal – 70152-77705

Disclaimer: Although this article was carefully crafted, it should only be regarded as general advice because it has been expressed in general terms. You should not act on the information provided in this article or refrain from acting upon it without first seeking professional advice since it cannot be relied upon to address your unique situation.

Author Bio

Manisha's potential cannot be elucidated in words. Her passion for writing knows no bounds. Associate Member of the Institute of Company Secretary of India and also holds a bachelor’s degree in Law. Having experience of more than 4 years of Forming Producer companies, Public and private companies View Full Profile

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