To cope with increasing workload amid paucity of people, the Department of Company Affairs has outsourced a record 17-18 inspections and is examining which other cases can be handled by outsiders under section 209 A of the Companies Act.
While high-profile cases like the Xerox ModiCorp probe into bribery allegations and others have already been handed over to qualified, outside agencies, the Shardul Shroff Committee is looking into which other types of investigations can be conducted by competent people outside of DCA.
"We have either already outsourced or are in the process of outsourcing 17-18 investigations. Besides, the Shardul Shroff committee is looking into whether other inspections can be outsourced under section 209 A," DCA Secretary V K Dhall said in New Delhi.
Dhall's comments come close on the heels of the parliamentary standing committee on finance asking the DCA to outsource routine inspections since there is a lack of investigating officers available with the department.
The panel's observations come even as the Xerox ModiCorp inspection, which was outsourced by DCA to a Delhi-based chartered accountant, is still hanging fire after the chartered accountant asked for repeated extensions since mid-2002.
"The government should seriously think about undertaking inspections under Section 235/237 of the Companies Act, 1956 only by their inspectors and consider outsourcing of routine inspection under Section 209A," the committee said in its 41st report, which was presented in Parliament.
Ruing the fact that DCA is not carrying out inspections with respect to even one per cent of the total companies, the panel noted that against a total number of 6,13,667 companies, the sanctioned strength of inspecting officers is only 37 and even out of this only 24 are in position with the remaining posts lying vacant.
"In the opinion of the committee it is just not possible for 24 officers to inspect around six lakh companies," the panel observed.
To tide over this crisis, the panel has asked DCA to take immediate steps to fill up the vacancies while simultaneously making efforts to get the staff strength increased.