Revision of financial statement or Board report(Sec 130 & 131 Companies Act 2013)
According to Section 130 and 131 of Companies Act 2013 accounts and Board report of the company can be reopened or revised with prior permission of Tribunal (NCLT) on following grounds:
A. if the accounts are prepared in a Fraudulent manners or the reliability of financial statement is doubtful because of the mismanagement of the affairs of the company (section 130)
B. if financial statements or report of the Board does not comply the provisions of section 129 or section 134 ( section 131)
A. if the accounts are prepared in a Fraudulent manners or the reliability of financial statement is doubtful because of the mismanagement of the affairs of the company (section 130)-According to Section 130 of Companies Act 2013 the accounts of the company can be reopened revised on following conditions:
- An application for revision or reopening of accounts has been made or filed before the court of competent jurisdiction or Tribunal by central government, Income Tax authorities, securities and exchange board, statutory regulatory body /authority or any Concern person;
- Then Tribunal shall give notice to the central government, Income Tax authorities, securities exchange board and other statutory regulatory body / authority or concern person who shall file a representation before the Tribunal asto revision of financial statement;
- If Terminal is satisfied that the accounts were prepared in a fraudulent manner or the accounts of the financial statement is not reliable due to mismanagement prevailed in the affairs of the company, then Court or tribunal shall order for revision or reopening of the account;
- Such order shall be filed with ROC and then after revise financial statement can be filed;
- It is pertinent to not here that Tribunal or court may take action against the officers of the company for fraudulently preparing the financial statement or for mismanagement of affairs of the company.
B. if financial statements or report of the board does not comply the provisions of section 129 or section 134( section 131)- According to Section 131 of Companies Act 2013 financial statement of any of the three preceding financial years can be revised subject to following conditions;
- An application before the Tribunal shall be filed by the company for revision of the financial accounts of any other three preceding financial years on the ground that the financial statement or report of the board has not complied the provisions of section 129 section 134 of the Companies Act 2013;
- Tribunal shall issue notice to Income Tax authorities and Central Government and will invite the representation or objections
- If Tribunal is satisfied then it may pass the order of revision of financial statement or board report;
- such order of Tribunal Shall be filed with Registrar of Companies;
- then after revised financial statement can be filed ;
- It is pertinent to Note that a fine of rupees 2500000 can be imposed on the company and every officer of the company may be imprisoned for a term of 3 years or with fine which may extend to 500000 rupees or both. Similarly Tribunal can also punish all the directors of a company with an imprisonment of one year or with fine of Rupees 2500000 or both.(see section 134(8))