Recently Ministry of Corporate Affairs has introduced a Form Active technically called Form INC – 22A. Noticeable features of this form are – (1) One time Form; (2) Requirement of latitude and longitude of Registered Office and (3) photograph of at least one director of the company. In this post, we will discuss the logic of this one time exercise and its logical future developments.
Form INC – 22A is a one-time form. This form is required to be filed by all active companies which had completed all important filing related to the last financial year and other event-based filings. A company completed this filing shall be called Active complied companies.
In a recent post here, we discussed how Rule 25A and Form INC – 22A originated from Section 12(9). This subsection requires physical verification of the registered office of the company. This is practically impossible for the Registrar of Companies to physically verify registered offices of each company manually and that too by personal visit. Technology provides a solution. A non – verification of the registered office of a company may result in strike off of the name of the company from the register of companies kept by the Registrar of Companies. In a layman language, this is life-threatening for the life of the company. However, this subsection is one of the key laws to handle with black money, money laundering, terrorist activities and other serious crimes and frauds.
The government is working in its goal to have a proper record of all companies and sooner compliance of subsection (9) of Section 12. Form INC -22A is not final compliance under this subsection, but just an initial step.
Once all companies submit geotagging details of their registered officers – latitude and longitude, Rule 25A shall be amended to enable a visit of a technologic assistant of Registrar of Companies or a robotic arm (or of a foot, one may say) of Registrar of Companies to the registered offices of companies.
The Government of India is planning to use drones allotted to the office of jurisdictional Registrar of companies for this purpose. We all presently know what is a drone and how it looks? We saw this device in a Bollywood film “Three Idiot” and “Uri – the surgical strike”. Presently in India, drones are being used for civilian purposes like photography and scientific survey. E-Commerce companies are testing drone for on – spot delivery of socially sensitive goods, books and food to the intended person identified by geo-tag of his mobile location and photograph. This will save time, distance and prevent location and identity-related problems.
Drone the Active shall deliver a sealed envelop issued by the office of jurisdictional Registrar of companies directly to the Director of Companies at the geotagged place mentioned as the registered office of the company. The Envelop shall have a specific alphanumeric code. The director shall enter that code on the designated website of MCA. Once entered, this process will verify the existence of the registered office of the company.
Use of drones for legal enforcement is a new idea being implemented in India. There is no scientific and technical data of the success of such a project. Government is trying to implement it in its signature surgical mode, without thinking of scientific challenges.
Presently, Presently Geotagging is not three dimensional but two dimensional. Hight needs to be recorded for the purpose of civilian use particularly to locate the registered office. This is more challenging than military use. We may list some challenge hereunder and seeking a solution from our readers –
- In major cities across India, registered offices are on multistory buildings. The numbering of the floor is not regulated. One building may have ground to 21st Floor and another building may have Lower Ground Floor, Upper Ground Floor and then go up to 21 floors. There may be some other numbering method. One building may not have 13th Floor at all while another may have 12, 12A and 14th
- Similarly, Hight of each floor is almost not regulated and not identical for any building.
- Another hight issue is the use of a reliable reference point for the hight. Every city, village and every building is situated on different hight form standard sea level.
- A major issue is a map inside the building. From where Dorne the Active will enter into the building and reach till the actual room in which registered office is claimed to be.
There may be some other important challenge before the Government. We need to deliberate upon with problem-solving attitude. We need to guide the government. Readers may access an ongoing discussion forum here.