MCA to review pending cases under companies law

The Ministry of Corporate Affairs will review pending litigations under companies law in different parts of the country, as part of larger efforts to reduce backlog of cases.
In this regard, the Ministry, which is implementing the Companies Act, has constituted seven regional committees. Each of them would be chaired by the regional director concerned.
The committees would "review all the prosecutions/ pending litigations in their regions, including cases filed by the official liquidators", a recent order from the Ministry said.
As part of the review, cases that can be withdrawn would also be identified.
For such cases, the committees concerned would list out the reasons for withdrawal along with details of cases, including the courts where those litigations are pending.

"Each committee shall submit its report to the Ministry clearly indicating road map for withdrawal of cases and the percentage of cases getting reduced as a result of such withdrawal," it added.

Reports have to be submitted to the Ministry within two months.
These committees can also seek assistance of experts in Companies Act.
Under the Ministry's administrative framework, there is a Registrar of Companies (RoC) for each state or union territory and that RoC reports to the regional director concerned. There are regional directors for seven regions.
Committees have been constituted for the seven regions -- Northern, South Eastern, Western, North Western, North Eastern, Eastern and South.

According to the order, the government has decided to chalk out an 'action plan for special arrears clearance drives' in order to reduce the number of court cases.
"There has been continued concern on account of ever increasing litigation and the need for reducing the arrears and backlog of cases in the courts is imperative. The review of these pending cases is long overdue...," the order said citing a recent meeting chaired by the Secretary of the Department of Justice.
There are more than 16 lakh registered companies in the country.
At the end of April, there were 16.5 lakh registered firms. "Of them, 303,086 companies were closed; 838 companies were assigned dormant status as per the Companies Act, 2013," according to the Ministry.