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New firms hit as site for registration down since a week

At a time when the country is being looked at as a hot destination for new ventures and several overseas entrepreneurs are looking to establish businesses here, the Registrar of Companies (ROC) server is down since over a week.

This has adversely affected those who wish to register new businesses in the country as they need to register themselves with the website and provide details like proposed name of the company, proposed directors’ details, proposed registered address of the firm/company etc. This forms the first step towards setting up the company.

Corporate lawyer K P Shreejit of M/s IndiaLaw has been trying to get his clients’ company registered with ROC since the past 12 days.  Every time he tries, he is told that the server is down. “We have been told that the server was manned by Tata Consultancy Services (TCS) earlier but now the Ministry of Corporate Affairs have switched over and that is leading to the issue,” he said.  “Imagine the losses that firms and corporates have to incur daily due to this technical glitch. Many activities related to ROC, including incorporation of new companies, have come to a halt.” 

Business affected
Rajni Choksi, Vice Chairman of Western Indian Regional Council of the Institute of Company Secretaries of India, said, “The entire day-to-day operation of firms across the country isaffected since the last few days due to the server issue.  Eversince the entire system has become online in 2006, all furnishing of statutory forms under The Companies Act, 1956, has to be done through ROC online, and a delay in submission of the forms also attracts penalty. The worst part is  that every time we contact ROC, we are told that the work is in progress and that the same will be sorted out shortly.  They should understand that the firms are incurring losses on a daily basis. Right from formation of a company to its daily functioning is getting affected.” 

Reason for delay
Anil Kumar Bhardwaj, Director e-Governance project for Ministry of Corporate Affairs, Delhi, is in-charge for the entire project. Though he was unavailable for comment, senior officials attached to the MCA confirmed to MiD DAY that ROC servers across India were affected. “The TCS contract was for five years which ended in 2012. As per the government procedure, fresh bids were called for and the rates quoted by another company were comparatively cheaper than other bidders including TCS and hence the contract has been allotted to them,” said a senior official. “Also, there were certain technical glitches which were brought to our notice by users earlier. We are sorting all those issues that will result in better speed and service for the end users,” he added.

Work in progress
When asked by when would the issue be solved, he said, “The technical team is working on the issues and it would surely get sorted out soon.” Vijay Mukhi, cyber expert said, “Things like this happen when — at times — we need to upgrade the software on the server. However, one should do it in such a way that the end user should have no knowledge at all and the down time has to be zero. When TCS left, they gave a working server, the new software company should have carried all their tests in the background and just moved over. This is not a technical glitch and this is not supposed to happen.” 

Case study
M P Sajeev (49) and his partners are struggling to get their proposed company registered with ROC, Mumbai, but due to a server issue they are unable to get the proposed company name or director details approved. They can have the digital signature for the directors submitted to ROC only after they get an approval for company name. Sajeev said, “We are setting up an hospitality company in Thiruvananthapuram with our registered office in Mumbai to cater to the IT companies likely to  come up in Techno Park, Thiruvananthapuram. We had planned to commence our business from April 2013, but with every delay in getting the basics in place, we are seriously worried.”  

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