Government activate governance companies = better

New Delhi, Jan 7: To give Indian = businesses a=20 competitive edge by ushering in better governance of the = corporate=20 sector, the Ministry of Company Affairs implemented several = new=20 initiatives including MCA21 e-governance project, mandatory = e-filing=20 and introduction of LLP Bill in 2006.

Side by side, = the=20 measures taken by the ministry during the year were aimed at = empowerment of investors through measures such as = segregation of=20 defunct and inactive companies.

With the phenomenal = growth of=20 corporate sector throwing up new challenges, the ministry = recognised=20 the need for prompt and efficient delivery of services to = enable=20 businesses compete globally while ensuring effective = compliance with=20 the law.

In this background, the ministry is = reorganising and=20 reorienting itself for its new catalytic role of a = facilitator, in=20 addition to streamlining the structure for enforcement. =

The=20 ambitious e-governance project known as 'MCA21', which = commenced=20 with the signing of contract with M/s Tata Consultancy = Services Ltd,=20 the selected operator, on March 1, 2005. The project was = launched by=20 Prime Minister Manmohan Singh on March 18, 2006.

So = far,=20 MCA21 has been launched across all 20 Registrar of Companies = (RoC)=20 jurisdictions in the country. Conceived as a mission mode = project=20 under the National e-Governance Plan, MCA21 is a = comprehensive=20 service delivery project to bring about a fine balance = between trade=20 facilitation on one hand and effective enforcement of the = corporate=20 laws on the other.

According to ministry sources, = MCA21 has=20 enabled business firms to register a company and file = statutory=20 documents quickly and easily and in a manner that is = convenient. The=20 public is empowered to get easy access to relevant records = and get=20 their grievances redressed effectively. Under the project,=20 professionals are enabled to offer efficient services to = their=20 client companies and the financial institutions facilitated = to=20 register and verify charges.

Mandatory e-filing = became the=20 order of the day with electronic filing of documents using = digital=20 signatures by the authorised signatories from September 16, = 2006,=20 ushering in a paperless era.

A total of 3,63,055 = documents=20 was filed electronically as on September 30, 2006. It is = expected=20 that the project would reach the desirable levels of service = by=20 March 31, 2007, doing away with problems associated with = paper-based=20 manual filing coupled with increased volumes of business. = This also=20 provides for search of comprehensive company databse = including=20 viewing of public documents online upon payment of necessary = fees=20 electronically.

Under an action plan, the ministry = attempt to=20 segregate and strike off the names of as many defunct = companies as=20 possible. It is estimated that out of 7.50 lakh companies=20 registered, about 1.50 lakh companies are defunct or = inactive. The=20 implementation of MCA21 would help in clear identification = of such=20 companies.

This apart, the ministry took several = initiatives=20 to redefine the contours of law for the growth of corporate = sector=20 through initiatives for comprehensive revision of the = Companies Act,=20 a new law on Limited Liability Partnership and notification = of=20 Accounting Standards.

Based on the inputs received by = the=20 government, including the Irani Committee Report, the = proposals for=20 a new Companies Bill that would replace the Companies Act = 1956 are=20 now being finalised. The new compact law is expected to = focus on=20 shareholders democracy, a disclosure based regime, rational = penal=20 provisions with built-in required deterrence and sufficient=20 protection for the interests of investors.

Limited = Liability=20 Partnership (LLP) Bill was introduced in the Rajya Sabha on = December=20 15. The LLP will be an alternative corporate business = vehicle that=20 would give the benefits of limited liability but would allow = its=20 members the flexibility of organising their internal = structure as a=20 partnership based on an agreement. While the LLP will be a = separate=20 legal entity, liable to the full extent of its assets, with = the=20 liability of the partners being limited to their agreed = contribution=20 in the LLP. Thus, no partner would be liable on account of = the=20 independent or unauthorised actions of other partners. =

The=20 proposed Bill will help Indian professionals in providing=20 accountancy and legal services globally, encourage = entrepreneurship=20 and take advantage of emerging opportunities in areas of = science and=20 technology.

Meanwhile, accounting standards were = reviewed and=20 revised for application in India and are being processed for = notification by the government. The diverse accounting = practices in=20 existence were also harmonised to enable = uniformity.

Steps=20 were taken to overcome legal challenges to certain = provisions of the=20 Competition Act 2002 by introducing an Amendment Bill in = Parliament=20 in the Budget session of 2006.

The Competition = Commission of=20 India is envisaged to be set up to ensure free and fair = competition=20 in the market and protect consumers' interests. The Standing = Committee on Finance, to which the Bill was referred, has = submitted=20 its report to Parliament in the winter session. =

Seminars and=20 media campaigns were organised by the Ministry for = investors'=20 education so as to enable them to take informed investment = decisions=20 with awareness of their rights and the risks involved. A = website=20 known as "Investor Helpline" was sponsored under the = Investor=20 Education and Protection Fund (IEPF). Launch of the website, = www.investorhelpline.in, was another attempt of the ministry = to=20 empower the investors by providing them with an alternative=20 mechanism for redressal of their grievances through the use = of=20 information technology.

The ministry has addressed = itself to=20 the menace of vanishing companies by taking concerted steps = against=20 the promoters of these vanishing companies. A new concept of = Director Identification Number (DIN) was introduced under = MCA21 to=20 identify and track such directors who try to vanish from the = scene=20 after mobilising resources from the gullible investors.=20

UNI