The Corporate Affairs Ministry has come to a conclusion that probe into alleged fraud at SpeakAsia can take even more time due to legal difficulties.
The Serious Fraud Investigation Office (SFIO), under the Ministry, is probing the claimed irregularities at Singapore – based multi-level marketing company SpeakAsia.
In response to a Right to Information (RTI) inquiry on the issue, the Ministry stated the time frame for finishing the SpeakAsia probe is yet to be quantified.
“Investigations into the affairs of the business SpeakAsia Online Pvt Ltd is not yet finalized and due to various legal issues associateded with carrying out examination of a foreign business having operations in India, the time frame for completion has not been quantified,” the Ministry has stated.
As of now, there is no clearness on whether it has the powers to probe irregularities of a business, which is signed up overseas, but has operations in India also.
The investigation agency is awaiting explanations on the issue from the Corporate Affairs and Law Ministries.
SFIO, established to probe corporate fraudulences under the provisions of Companies Act, started examinations into SpeakAsia after a claimed scam came to light early last year.
The agency takes up only those instances that are referred by the Corporate Affairs Ministry.
Under the existing Companies Act, there is no quality on whether Indian authorities have powers to probe an overseas body having operations in the nation. However, this issue has been dealt with in the new Companies Bill, which is most likely to be reviewed in the Parliament soon.
In the brand-new Companies Bill, clause 228 offer powers for authorities to look into affairs of overseas business having operations in India.
As per the Statement, “This is a new clause and looks for to offer that the provisions relating assessment or investigation under Chapter XIV shall also apply mutatis mutandis to assessment or investigation of foreign companies”.
Chapter XIV is related to evaluation, inquiry and examination of business.
According to its web site, SpeakAsia is not registered as a business in India as it is not a long-lasting establishment (PE) here.
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