The Ministry of Corporate Affairs has taken a serious view of professionals who help companies incorporate by falsely certifying they have visited the premises of the intended registered office.
In an early indication of likely tightening of rules governing these professionals, the ministry has flagged its concerns about wrongful certification of premises of companies to its field officers and to the self-regulator of company secretaries, the Institute of Company Secretaries of India (ICSI), said a person informed about the development.
Company secretaries, chartered accountants, cost accountants and advocates are allowed to make this certification.
Falsely certifying the physical premises is linked to formation of shell companies, and the government wants field officers and regulators like ICSI, Institute of Chartered Accountants of India (ICAI) and Institute of Cost Accountants of India to be vigilant and to sensitize professionals about this requirement, said the person speaking on condition of anonymity.
As part of the paperwork of incorporating a company, professionals have to certify they have “personally visited the premises of the proposed registered office given in the form” and that the office will function from there after incorporation. Any false statement is liable for punishment.
A second person informed about the government’s concerns said in certain cases, professionals have certified the existence of premises in far-flung states, raising doubts about the veracity of the certification.
An email sent to the spokesperson for the ministry of corporate affairs on Friday seeking comments for the story remained unanswered at the time of publishing.