Satyam scam an aberration, new Companies Bill soon: Govt
Terming the nearly Rs 10,000 crore scam in Satyam Computers as an aberration, the government on Thursday said the proposed new Companies Bill provides more stringent provisions to avoid such frauds in the future.
"Government proposes to introduce the Companies Bill, 2008 as the Companies Bill, 2009, which seeks to have more stringent provisions in case of frauds by companies, their directors and auditors," Minister of Corporate Affairs Salman Khurshid said in Lok Sabha during the Question Hour.
On the timing of introduction of new bill, he said the government intends to introduce it in the current session of Parliament.
The report of investigation into the affairs of Satyam has been received from the Serious Fraud Investigation Office (SFIO), he said adding the CBI has also conducted its probe into the criminal liability arising from the events relating to the scam.
"All the concerned persons have been arrested except one and prosecution has begun against the guilty," Khurshid said.
Satyam scam involved forgery and manipulation of computer programmes he said adding that the new Bill seeks to address all such issues.
"Satyam scam is an aberration and the events are specific to the company in question.
No other scam of this nature has come to notice since then," he added.
Replying to a supplementary, Khurshid said action was being taken to prosecute those found involved on the basis of the investigations, along with action by various other regulatory bodies or agencies.
He also assured the House that an elaborate regulatory framework is in place to deal with incidents of fraud. The framework provides for statutory disclosures to stakeholders about the affairs of companies under the Companies Act.
In another written reply, Khurshid said the role of an independent director may also come up, inter alia, for deliberations during the scrutiny of the new companies bill by the Parliamentary Standing Committee on Finance.
The government has also amended the Chartered Accountants Act and the Company Secretaries Act to provide for a more effective disciplinary mechanism to deal with cases of misconduct by CAs and CSs respectively, he added.
