Physical Verification Of Registered Office by ROC

SHORT SUMMARY

As per the MCA notification dated 18thAugust 2022 Government has notified the Companies (Incorporation) Third Amendment Rules, 2022. As per the amended rules MCA has added a new Rule i.e.25B- Physical verification of Registered office of the Company. This rule came to complete the Section 12(9) of Companies Act, 2013.

MCA has made amendment in Section 12(9) of Companies Act, 2013 on July, 2019. Since that period the manner/ process of physical verification of registered office was pending for MCA side. Finally, MCA came with rule 25B.

Note: This amendment in Rules in nothing but an attempt to only prescribe the procedure for an enabling clause which was inserted through a new Sub-sec (9) in Sec 12 of the CA2013 as amended in 2019.

These rulesonly provides that when the ROC has a reasonable cause to believe that the company is not carrying on business only then he can cause a physical verification.

I. Interpretation of Provisions

As per the provisions of Rule 25B “ROC may visit the Registered office of the Company and conduct physical verification of Registered Office.”

II. Situations in which ROC can conduct physical verification

There is dilemma in the professionals/ corporates in respect of situations in which ROC can conduct the Physical Verification. Many questions asked by professionals on these rules. Like:

• Whether these rules applicable on New Incorporations?
• Whether these rules shall be apply on old Incorporation?
• Whether ROC will conduct physical verification of Registered office of all the Companies?

After reading the rule 25B along with Section 12(9) one can opine that following shall be situations when ROC can conduct physical verification of Registered office.

1. ROC Received any Complaint: If ROC received any complaints against the Company from any other authorities, stake holders, public etc. In such situations ROC can conduct the physical verification of Registered office of Company.

2. Notice Returned Back: If ROC/ RD send any notice or letter to Company. Such letter returned as undelivered. In such situations it can be presume that Company is not maintaining registered office on address mentioned as Registered office and ROC can conduct physical verification of Registered office.

3. Annual Documents not Filed: If Company has not filed Annual Forms like AOC-4, MGT-7 etc. continue 2 years or more. In such situation as per provisions of Section 12(9) of Companies Act, 2013 ROC can take a view that Company is not carrying on any business or operations, he may cause a physical verification of the registered office of the company

4. Non filing of Declaration of Commencement: If Company has not filed Declaration of Commencement of Business in e-form INC 20A. In such situation as per provisions of Companies Act, 2013 ROC can take a view that Company is not carrying on any business or operations, he may cause a physical verification of the registered office of the company

5. Company fails to file INC-22: If in any case at the time of Incorporation of Company, its doesn’t mention the address of Registered office of Company in SPICE Part B, Company have to file INC-22 within 30 days of Incorporation. In such case, if Company fails to file INC-22 in such situation ROC can take a view that Company is not maintaining its registered office and can conduct physical verification of Registered office of Company.

III. Consequence of non-maintenance of Registered Office

Where the registered office of the company is found to be not capable of receiving and acknowledging all communications and notices, the Registrar shall send a notice to the company and all the directors of the company, of his intention to remove the name of the company from the register of companies.

IV. Process of Physical Verification of Registered Office

The Registrar shall carry the documents as filed on MCA 21 in support of the address of the registered office of the company for the purposes of physical verification to authenticate the place and documents. The ROC shall

a) check the authenticity of the documents filed with ROC by the Company by cross verification with the copies of supporting documents of such address collected during the said physical verification
b) take a photograph of the registered office of the company while causing physical verification of the same
c) Prepare report of the physical verification and Report on Physical Verification of the Registered Office of the Company shall includes followings:

1. Name and CIN of the Company
2. Latest address of the registered office of the company as per MCA 21 record
3. Date of authorization letter issued by the Registrar of Companies
4. Name of the Registrar of Companies
5. Date and Time of visit for physical verification of the registered office
6. Location details along with Landmark
7. Details of the person available if any at the time of the visit-

• Name
• Father's Name
• Residential address
• Relationship with the company, if applicable

8. Remarks if any
9. Documents attached

• Copy of the agreement/ownership/rent agreement/No
• Objection Certificate of the registered office of the company from owner/ tenant/ lessor: -
• Photograph of the registered office
• Self-Attested ID-Card of the person available, if any
• Any other document(s)