NEW RULE 25B – PHYSICAL VERIFICATION OF REGISTERED OFFICE BY MCA

COMPANIES (INCORPORATION) THIRD AMENDMENT RULES, 2022

Companies (Incorporation) Third Amendment Rules, 2022 has been notified on 18^th August 2022 by Ministry of Corporate Affairs (MCA) to further amend the Companies (Incorporation) Rules, 2014. In this amendment, MCA has introduced a new Rule 25B, which is about Physical verification of the registered Office of the Company. However, this new Rule will come into effect once notified in the Official Gazette.

OVERVIEW OF RULE 25B

Earlier, as per Section 12 of the Companies Act 2013, physical verification of the company’s registered office was required only when ROC have reasonable grounds to believe that the company concerned is not carrying on a business. However, after the amendment in the Companies (Incorporation) Third Amendment Rules, 2022, physical verification has been implemented as per Rule 25B.

After Rule 25A (Active Company Tagging Identities and Verification), MCA has inserted new Rule 25B (Physical verification of the Registered Office of the company).

Companies (Incorporation) Third Amendment Rules, 2022 has been introduced by the government to ensure a more transparent process for the physical verification of companies’ registered addresses. According to the new Rule 25B, the Registrar of Companies (ROC), based upon the information made available on MCA 21 portal, shall visit the Address of the Registered Office of the company and do the physical verification of the Registered Office of the company.

• As per the new rule 25B, ROC will carry out a physical verification of the location of the Registered Office of the company in the presence of two independent witnesses.
• The Registrar shall carry the documents filed on the MCA 21 portal in support of the Address of the company’s registered office for physical verification.
• To check the authenticity and validity of the documents as well as the office, the same shall be cross-verified with the copies of supporting documents of such Address collected during the physical check, duly authenticated from the occupant of the property where the Registered Office is situated.
• The Registrar will also need to have a photograph of the company’s registered Office for proof during the physical verification.
• If required, RoC will also seek assistance from the local police.

After conducting the verification process, a detailed report shall be prepared including all the information such as location details and photographs.

REGISTERED OFFICE OF A COMPANY

The company’s Registered Office is the main Office of the Company at which all the communication relating to the company are sent by the governmental departments. Company’s Registered Office shall be declared during company incorporation/LLP incorporation by the Directors of the company/LLP and they shall maintain all the required documents at the registered Office.

• Registrar of Company (ROC) will be determined by the state or location where the Registered Office of the Company is situated.
• Any change in the Company’s address/location of the Registered Office must notify the Registrar of Company (ROC) within a specified period of time.

REPORT ON PHYSICAL VERIFICATION OF COMPANIES REGISTERED OFFICE

Verification Report of the Registered Office of the company will be prepared by RoC in the given format.

• Name and Company Identification Number (CIN) of the company
• Latest Address of the company as per the MCA 21 records
• Date of authorization letter issued by the Registrar of Companies
• Name of Registrar of Companies
• Date and Time of Physical verification
• Location Details of Company along with the landmark
• Details of person available at the time of Physical verification

Along with these details, ROC will also have to attach the following documents with the report:

• Copy of agreement/ownership /rent agreement/No objection certificate (NOC) of the registered Office of the company from owner/tenant/lessor
• Photograph of the Registered Office
• Self-Attested ID card of the person available

NOTICE TO COMPANY AND DIRECTORS

Suppose the Registered Office is unable to receive and acknowledge all notices due to its location or any other issue. In that case, the ROC will notify the Company and all Directors of the intention to remove the company’s name from the official Register of Companies (ROC) by the way of show-cause notice and request them to send their reply along with the required documents.

The Director of the company needs to send their reply against the show-cause notice along with the necessary documents within 30 days from the date of the notice by the MCA; otherwise, ROC will have to take further action under section 248 of the Companies Act.