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Richa Mishra

New Delhi , Aug 3

THE efforts of the Institute of Company Secretaries of India (ICSI) to be registered under the Investor Education and Protection Fund (IE&PF) seem to have yielded results. The 13-member IE&PF panel constituted by the Ministry of Company Affairs (MCA) has accepted the institute's request of allowing it to participate in investor protection activities.

Armed with this approval, the institute can now conduct investor clinics, according to ICSI officials. The IE&PF has been established under Section 205C of the Companies Act, 1956 by way of Companies (Amendment) Act, 1999 for the promotion of investors' awareness and protection. IE&PF has to its credit about Rs 352 crore up to December 31, 2004 and about Rs 100 crore is added every year to the Fund.

However, the money directly goes to the Consolidated Fund of India (CFI), and the IE&PF panel is allocated an amount for taking up investor protection activities. This amount mainly comes from four sources - share application money, debentures, unpaid dividends and unclaimed deposits. For the current fiscal, IE&PF has been allocated Rs 2.5 crore.

Regarding the activities to be undertaken by the institute, sources said, initially, ICSI would hold investor clinics in its own regional offices, chapters and satellite chapters. These would be low-cost, and concentrate on practical issues faced by investors in non-metro cities, sources explained.

Incidentally, as per the Ministry's own admission to the Standing Committee, the activities under IE&PF need to be expanded by taking up the financial literacy programme in a big way. Further, the Ministry has submitted to the Committee that a professional agency would be appointed to advise IE&PF on various activities.

The Parliamentary Committee had recommended to the Government that no effort should be spared to take up awareness activities and the proposal to engage a professional agency may be expedited. Further, the Committee expressed concern that the activities under IE&PF have a little penetration in the rural areas.

It suggested that more NGOs and voluntary organisations should be encouraged to take up the task of educating rural investor.

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