Section 211 of the Companies Act, 2013-Establishment of Serious Fraud Investigation Office.
Updated: Oct 7, 2022
SFIO is an organization in India that investigates significant fraud cases. The Ministry of Corporate Affairs of the Government of India is in charge of it. It is a multidisciplinary organization with professionals from the financial sector, capital market, accounting, forensic audit, taxation, law, information technology, business law, customs, and investigation to prosecute white-collar crimes and frauds under the company's law. The agency's main office is in New Delhi, the capital of India; it also has four regional offices there: in Hyderabad, Mumbai, Kolkata, and Chennai.
The establishment of the Serious Fraud Investigation Office is covered in Section 211 of the Companies Act of 2013. This section has a total of five clauses.
According to the first provision, The Central Government shall, by notification, create an office to be known as the Serious Fraud Investigation Office to look into corporate fraud:
The Serious Fraud Investigation Office established by the Central Government in accordance with Government of India Resolution No. 45011/16/2003-Adm-I, dated the 2nd July 2003 shall be deemed to be the Serious Fraud Investigation Office for the purposes of this section until the Serious Fraud Investigation Office is established under subsection (1).
Further, the second provision states that the SFIO will be led by a Director and will be made up of as many specialists from the following fields as the Central Government decides to appoint: (a) Banking, (b) Corporate Affairs, (c) Taxation, (d) Forensic audit, (e) Capital Market, (f) Information Technology, (g) Law, or (h) Other professions.
In accordance with the third clause, The Central Government shall, by notification, appoint a Director in the Serious Fraud Investigation Office who shall be an officer not below the rank of a Joint Secretary to the Government of India and who shall have knowledge and experience in dealing with matters relating to corporate affairs.
The fourth clause also specifies that the Central Government may designate any experts and other officials and staff that it deems appropriate for the Serious Fraud Investigation Office to effectively carry out its responsibilities under this Act.
The final clause specifies that the director, experts, and other officials and employees of the Serious Fraud Investigation Office shall be subject to the terms and conditions of employment that may be established.
Rule 3 and 4 of Companies (Inspection, Investigation, and Inquiry) Rules, 2014 are applicable to this section.