UNDER SECTION 215 OF THE COMPANIES ACT 2013

QUOTING THIS ACT

No firm, body corporate or association shall be appointed as inspector.

DEFINATION

FIRM

A firm is a for-profit business entity that offers professional services, such as a corporation, limited liability company (LLC), or partnership. Most businesses only have one location. On the other hand, a business firm is made up of one or more physical locations that are all owned by the same person and share the same EIN (EIN).

The term “firm,” when used in a title, is frequently connected to companies that offer expert legal and accounting services, but it can also refer to a wide range of companies, including consulting, marketing, and graphic design firms, among others.

BODY CORPORATE

A corporate entity with a legal existence is referred to as a body corporate.

The Companies Act of 2013’s Section 2(11) provides a definition of the phrase “body corporate.” Private companies, public companies, one person’s company, small companies, Limited Liability Partnerships, overseas companies, etc. are all included in this.
A business that was incorporated outside of India is also considered a “body corporate” or “corporation.”
Body corporate, however, excludes—

I a cooperative society that has been authorized by a legislation governing cooperative societies; and

(ii) any other business entity that the Central Government may designate in this regard by notification that is not a company as defined by the Companies Act 2013.

OTHER ASSOCIATION

is a group of people who are structured in varied degrees of formality and who have common interests or a common purpose – compare corporation.

INSPECTOR

is an official who works to make sure that rules are followed, particularly in public services.

The provision is in place to make sure that the investigation is conducted impartially, therefore the party is not permitted to nominate one of its members as the inspector and cast a vote that Favours them.

Equal opportunity is the rule.

POWER, PROCEDURE OF INSPECTOR (SECTION 217)

(1) All officers, other employees, and agents, including former officers, employees, and agents of a company under investigation in accordance with the provisions of this Chapter, and all officers, other employees, and agents, including former officers, employees, and agents of any other body corporate or person whose affairs are under investigation under section 219, shall have the following obligations:

(a) to keep and make available to an inspector or anyone else designated by him in this regard all books and papers belonging to or relating to the company or, where applicable, to the other body corporate or the person, which are in their care.

(b) to provide the inspector with any and all help they are able to provide in connection with the inquiry in any other case.

(2) The inspector may require any corporate body, other than a corporate body referred to in subsection (1), to provide information to, or to produce books and papers before, him or any person he may designate in this regard, as he may consider necessary, if the provision of such information, or the production of such books and papers, is relevant or required for the purposes of his investigation.

(3) The inspector must return any books and papers created in accordance with subsections (1) or (2) to the company after not more than 188 days in his possession.

(4) On oath, an inspector may—

any of the individuals mentioned in subsection (1) (a); and

(b) any other person, with the Central Government’s previous approval,

with relation to the business of the corporation, other body corporate, or individual, as the case may be, and for that reason may demand that any of those people make a personal appearance before him:

As long as an investigation is being conducted in accordance with Section 212, the Director of the Serious Fraud Investigation Office’s prior approval is sufficient (b).

(5) The inspector, an officer of the Central Government, conducting an investigation under this Chapter shall have all the powers granted to a civil court under the Code of Civil Procedure, 1908, while trying a case in respect of the following matters, despite anything to the contrary in any other law currently in effect or in any contract.

(a) the finding and production of financial records and other documents at the location and time that may be selected by that person.

(b) calling people to appear, requiring their presence, and questioning them under oath; and

(c) any books, registers, or other corporate papers may be inspected wherever they are kept.

(6) I If any director or officer of the company disobeys the instruction given by the Registrar or the inspector under this section, the director or officer will be subject to a punishment that must not be less than $25,000 but may reach $1 lakh as well as imprisonment that may last up to a year.

(7) The written notes of any examination conducted in accordance with subsection (4) shall be given to, read to, and signed by the subject of the examination. These notes may then be used as evidence against the subject of the examination.

(8) In order to conduct inspections, inquiries, or investigations that the inspector may request with the prior consent of the Central Government, officers of the Central Government, State Government, police, or statutory authority shall help the inspector.

(9) Upon receiving a letter of request from a court or other authority in a nation or location outside of India, qualified to issue such a letter in that nation or location, for the examination of any person or the production of any document or thing in relation to the affairs of a company being investigated in that nation or location, the Central Government may, if it thinks fit, forward such letter of request to the court concerned, which shall then summon the person before it and re-examine the matter.

(10) The Central Government may, by notification, make the application of this Chapter with respect to a foreign State with which reciprocal arrangements have been made subject to any modifications, exceptions, conditions, or qualifications that may be necessary in order to assist in any inspection, inquiry, or investigation under this Act or under the applicable law in that State.

The Act, however, does not prescribe any time limit which the report is to be made.Therefore,in ASHOKA MARKETING LTD.V. UNION OF INDIA,

the court held that failure on the part of inspector to sumit the report within reasonable time amount only to breach of duty on his part but it does not bring the investigate automatically to an end.

REFERENCES

THE COMPANIES ACT 2013.

Dr. N.V. Paranjape

https://ibclaw.in

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