Post-Satyam, 150 firms come under scanner
By siliconindia   |   Saturday, 07 February 2009, 00:10 IST   |    5 Comments
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Post-Satyam, 150 firms come under scanner
New Delhi: In a bid to curb anymore Satyam like saga in future, around 150 private sector companies have been put under the scanner by the Registrar of Companies (RoC). "Our idea is to clean the system. The corporate sector is expected to follow the best practices as far as corporate governance is concerned," said Minister for Corporate Affairs Prem Chand Gupta. "The 150 companies include Swaraj Mazda, Glenmark Pharmaceuticals, Shalimar Paints, Madras Aluminium Company, Akruti Construction, Triveni Infrastructure, Viraj Group, Uttam Galva Steel, Manipal Finance Corporation, South City Projects and Metro Tyres," an official involved in the inspection told The Economic Times. Even some of the charitable companies established under the Section 25 of the Companies Act are also being inspected by RoC. The inspection entails RoC officials visiting company premises, scrutinizing the books and taking possession of documents, if required, though harsh actions like detention of the company executives are not yet implemented. Gupta had ordered a similar inspection of six state-run companies' books on February 2 and announced that books of private sector companies would come next. It, however, does not include harsh steps such as detaining company executives for questioning. The companies, which have received adverse remarks from auditors, are under the scanner. The remarks are on financial statements, serious and substantiated investor complaints, prima-facie violation involving non-disclosure of material facts, improper related party transactions and references from other regulators such as the Income Tax department, SEBI and the RBI. RoCs have about two months to complete the inspection under section 209A of the Company Law. Depending on the nature of the violations, the government will decide whether to prosecute the accused or order a probe by the Serious Fraud Investigation Office.

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