A group of creditors of Dodlab Trading Ltd. made a complaint to the Registrar of Companies (RoC), Bangalore alleging that the management of the Company is indulging in destruction and falsification of the accounting reco

CS Professional · Resolution of Corporate Disputes, Non-Compliances & Remedies · PYQS · December 2022
A group of creditors of Dodlab Trading Ltd. made a complaint to the Registrar of Companies (RoC), Bangalore alleging that the management of the Company is indulging in destruction and falsification of the accounting records. The complainants request the RoC to take immediate steps to seize the records of the Company so that the management may not be allowed to tamper with the records. The complaint was received at 10 AM on July 1, 2021 and the RoC entered the premises at 10.30 AM for the search. State the powers of the Registrar to seize the books of the Company.

Answer & Explanation:

Section 209 of the Companies Act, 2013 provides that where, upon information in his possession or otherwise, the Registrar or Inspector has reasonable ground to believe that the books and papers of a company or relating to the Key Managerial Personnel (KMP) or any director or auditor or Company Secretary in practice if the company has not appointed Company Secretary are likely to be destroyed, mutilated, altered, falsified or secreted, he may, after obtaining an order from the Special Court for the seizure of such books and papers - Enter, with such assistance as may be required and search the place or places where such books or papers are kept; and Seize search books and papers as he considers necessary after allowing the Company to take copies or extracts from, such books or papers at its cost. According to the above provisions, Registrar may enter and search the place where such books or papers are kept and seize them only after obtaining an order from the Special Court. Since in the given question, Registrar entered the premises for the search and seizure of books of the company without obtaining an order from the Special Court, it is not authorized to seize the books of Dodlab Trading Ltd.

Topics: Company Law

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