Distinguish between the following: 'Inspection' and 'Investigation'

Feature Inspection Investigation Meaning Inspection is a process through which one can collect the required information. It is a preliminary examination of records. Investigation is the process of inquiring something thoroughly. It is the systematic examination and scrutiny of the factors that have affected the subject of the investigation in order to uncover facts regarding the matter. It is a deeper probe. Governing Section Dealt with under Section 206 of the Companies Act, 2013 . Dealt with under Sections 210 to 229 of the Companies Act, 2013 . Authority Conducted by the Registrar of Companies or Inspectors appointed by the Central Government. Conducted by Inspectors appointed by the Central Government. Objective To ascertain that all transactions have been validly entered into and recorded in appropriate books and that applicable laws, rules, and procedures have been complied with by the company. To collect evidence and to see if any illegal acts or offences are disclosed and then decide the action to be taken. It is a fact-finding exercise to uncover irregularities. Scope May extend to the Books of Accounts, other Books and Papers, and Statutory Records of the company at its registered office or other premises. Includes investigation of all its business affairs – profits and losses, assets (including goodwill), contracts and transactions, investments and other property interests, and control of subsidiary companies too. It is broader and more in-depth. Nature of Action Generally, a routine check or a check based on specific complaints or information. Initiated when there are suspicions of fraud, mismanagement, or other serious irregularities. Outcome May lead to further inquiry or investigation if irregularities are found. Aims to establish facts, identify culprits, and recommend legal action or penalties.