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Our Bureau

``There is no clash (between DCA and SEBI). There is perfect harmony. The main purpose must be achieved and that is to protect the investors.''

New Delhi , May 26

ENACTING a slimmer Companies Act with strong investor protection provisions will be the priority for the Minister of State (Independent Charge), Ministry of Company Affairs, Mr Premchand Gupta.

After being tossed around from one ministry to another, Company Affairs has now been given the status of an independent ministry.

Regarding the legal hurdles faced by the Competition Commission of India (CCI) and the National Company Law Tribunal (NCLT), the Minister said, "the Ministry will try to sort out issues." With the matter of the two tribunals not likely to be sorted out before July, whether the terms of the members of the Company Law Board (CLB) and the Board for Industrial and Financial Reconstruction (BIFR), if required, will be extended, a Company Affairs official said, "a vacuum is never created. Transitional arrangements have been made for the BIFR."

Prioritising investor protection in the backdrop of corporate frauds and failures worldwide, the Minister said, defaulters will not be able to escape.

Spelling out his agenda, he said, the focus is to facilitate growth of a healthy corporate sector by ensuring that the companies are free of unnecessary constrains.

"The priority is also to reduce paper work, ensure transparency and clear implementation of Company Acts," the Minister told reporters here.

The Department of Company Affairs (DCA), till now, has been bogged down by maintaining almost 150 million statutory documents filed by companies to the registrar of companies (RoCs). This needs to be rectified, the Minister said. The DCA has initiated a computerisation programme of the entire department to streamline the procedures and lessen paper work, the Company Affairs Secretary, Mr M.M.K. Sardana, said.

The Minister stressed that, "We need to do way from provisions that are not required either by deleting them or merging them with other sections of the Act." In fact, the Ministry is in the process of coming out with a concept paper on Companies Act, which would make it compressed and sleeker.

When asked what kind of relationship the Ministry would be having with the capital market regulator, the Securities & Exchange Board of India (SEBI), the Minister said the ministry would work closely with SEBI to safeguard the interests of investors. ``There is no clash (between DCA and SEBI). There is perfect harmony. The main purpose must be achieved and that is to protect the investors,'' he pointed out.

He further said that to protect the gullible investor interest, "the Ministry will not hesitate to review the existing guidelines for name change and registration to ensure that companies raising money from the market do not dupe investors."

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