Ministry of Corporate Affairs announces flagship project-to share data of 10 lakh companies with regulators

Ministry of Corporate Affairs announces flagship project-to share data of 10 lakh companies with regulators. The Ministry of Corporate Affairs announces its flagship e-governance project wherein the MCA will share its data of more than 10 lakh companies with regulators and enforcement agencies. This initiative is brought aforth to check corporate frauds at an early stage. The ministry will convert statutory filing of registered companies into simpler information that can be used by regulators and enforcement agencies for clamping down on frauds.  Fraud

MCA21 project, the flagship e-governance initiative of the government under the National e-Governance Plan, has fully automated all filling processes related to compliance and enforcement of the Companies Act, creating an electronic repository of Indian corporate sector information. The government has been under pressure to create an early warning system following the Saradha scam, in which lakhs of investors were defrauded of thousands of crores. The Supreme Court had questioned the failure of regulators in spotting the scam this big, saying that “a larger conspiracy” was in play. Not just Saradha, the corporate arena has been split with numerous such scams, like Satyam fiasco, Spectrum and many more.

The MCA is in talks with all regulators and looking to set up a reciprocal arrangement with the Central Board of Excise and Customs, the Central Board of Direct Taxes, the Securities and Exchange Board of India, the Reserve Bank of India and Financial Intelligence Unit for mutual exchange of data.

Parallel views have been shared by experts. The new Act, in itself has brought about a bunch of compliances and requirements that are proving to be a hassle from the company’s perspective. Hence, in such a situation, the comparatives of introducing this scheme should be pre-assessed by the MCA.

The processed data will also be shared with RBI and the Central Statistical Office (CSO) for enabling estimation of the macro-economic aggregates, which is expected to help the government in framing macro and sectoral-level policies.

Source: Economic Times