With the growth in economic crimes in India and sensing the need to have the stringent provisions to tackle this problem, the Companies Act, 2013 (Companies Act) for the first time introduced the provisions related to fraud in a very exhaustive manner. While initiating investigations, the government may consider the gravity, enormity of the fraud and not simply the financial ramifications. The investigation report of SFIO filed with the Court for framing of charges is treated as a report filed by a police officer. Under the Companies Act, the offences which attract punishment under the act are congnizable and non-bailable, which means a police officer has the authority to make an arrest without a warrant. (Shisham Priyadarshini is Partner, Rajani Associates and Amish Shroff is Principal Associate at Rajani Associates.)

Source: Economic Times October 08, 2016 06:22 UTC