Limited amnesty scheme for defaulting companies

By Our Special Correspondent

NEW DELHI, MAY 16. The Government has decided to set up an Additional Principal Bench of the Company Law Board for southern States. The bench - the first additional bench to be created - will function from Chennai which now has a regional bench of the board.

An important scheme permitting the defaulting companies to comply with the law by filing pending documents with the Registrar of Companies on payment of certain lumpsum compounding fee has also been finalised. Called the Company Law Settlement Scheme 2000, the limited amnesty scheme will be in operation for three months beginning from June 1.

Making these announcements in the Lok Sabha today, the Union Law Minister, Mr. Ram Jethmalani, said the Additional Principal Bench in Chennai would consist of the present judicial members of the Chennai Regional Bench and the vice chairman of the Principal Bench of the Company Law Board in Delhi.

The post of vice chairman along with its current incumbent was proposed to be transferred to Chennai to facilitate establishment of the Additional Principal Branch.

The proposed bench would function under the control, supervision and superintendence of the Company Law Board chairman.

Mr. Jethmalani said the proposed bench would have jurisdiction over Tamil Nadu, Karnataka, Andhra Pradesh, Kerala and Pondicherry. With this formation, the long pending demand and aspiration of the people of southern States would be fulfilled in adequate measure.

Earlier, he said the Company Law Board, a quasi-judicial body, had now a Principal Bench in New Delhi. Apart from this, there were four regional benches functioning in the four metros.

While powers and jurisdiction of both the principal and regional benches have been well defined, the Principal Bench deals with certain matters on an all India basis. The regional benches deal with certain matters relating to the regions falling under their jurisdiction.

Mr. Jethmalani also appealed to the defaulting companies to take advantage of the amnesty scheme to enable them to submit certain pending documents on payment of lumpsum amounts ranging from Rs. 2,500 to Rs. 15,000, depending on the period of delay and the number of documents.

Urging the companies to avail themselves of the one-time opportunity and avoid prosecution, he warned that the department would subsequently come down with a heavy hand on the erring companies and that the fines would be increased to 10 times the present amount.

The Department of Company Affairs, he said, was hoping to net in Rs. 100 crores through the successful implementation of the scheme.

The money collected through the scheme was proposed to be utilised for computerisation and mondernisation of the work of the department and streamlining its operations.

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Section  : Business
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