SECTION 208. REPORT ON INSPECTION MADE
[Effective from 1st April, 2014]
The Registrar or inspector shall, after the inspection of the books of account or an inquiry under section 206 and other books and papers of the company under section 207, submit a report in writing to the Central Government along with such documents, if any, and such report may, if necessary, include a recommendation that further investigation into the affairs of the company is necessary giving his reasons in support.
Delegation of powers to RDs u/s 208 read with section 458 of CA, 2013
Notification No.- S.O. 3557(E) dated 31-12-2015
In exercise of the powers conferred by section 458 of the Companies Act, 2013 (18 of 2013) the Central Government hereby delegates to the Regional Directors at Mumbai, Kolkata, Chennai, Delhi, Ahmedabad, Hyderabad and Shillong, the power vested in it under section 208 of the said Act for receiving the report from the Registrar (having jurisdiction over the place of registered office of the company concerned) or from the Inspector where such report recommends action for violation of offences under the said Act for which imprisonment of less than two years is provided, (except for violation of offences under Chapter III, IV section 127,177 and 178 for which the report shall be received by the Central Government), subject to the conditions, namely:-
2. On receipt of the report referred to in paragraph 1, the Regional Director –
(a) shall examine the report and obtain legal advice, if required;
(b) shall direct initiation of prosecution if he agrees with the recommendation of the Registrar or inspector to initiate prosecution against the company, officers or employees, present or past of the company, or any other person connected with the affairs of the company; and
(c) shall inform the Central Government (along with reasons for non-acceptance of recommendation of Registrar or inspector, wherever he disagrees) about the action taken on the report submitted by Registrar or Inspector.
3. The Regional Director shall, on receipt of the report, where such report recommends action for violation of offences other than those specified in paragraph 1, examine the same, obtain legal advice, if required, and submit it to the Central Government seeking initiation of prosecution.