No more queues for start-ups, just log on

In a couple of years, starting a business and running it would no longer be a drudgery of paper work: the government plans to introduce dire...

In a couple of years, starting a business and running it would no longer be a drudgery of paper work: the government plans to introduce direct online registration and filing of accounts to avoid long queues and red tape.

The measure is aimed at reducing paperwork, which amounts to about six crore pages each year from 650,000 firms. However, to compensate the babus of their dent in hold-over firms, they would be assigned to audit inspections.

The proposal is to allow individuals and corporate bodies to float new ventures with the Registrar of Companies (RoC) using email to get Certificate of Incorporation and a Certificate of Commencement, while sitting in offices and homes.

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To that end, the Cabinet last week approved the Department of Company Affairs’ proposal to hire Tata Consultancy Services to develop a solution architecture that would be friendly to different accounting softwares used by various companies.

The Rs 350-crore project is for preparing a Corporate Governance Service whereby a firm could also obtain approval from the Registrar of Companies for the proposed name of the company, to pay registration fee and submit the memorandum of understanding and articles of association.

Incorporated companies will be able to submit their adoption of accounts, balance sheets, profit and loss account online.

They would have to file their adoption and passage of accounts, decisions at their shareholders’ meeting and AGMs for the RoC to keep a tab on their time compliance.

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The system is expected to be in place before September 2006 to meet the filing of half-yearly closing of accounts. The entire project is spread over five years but initially, 53 locations would have access to electronic filing, all Export Promotion Zones and the state capitals.

The online filing would be a one-way street to ensure security. Once filed, the data would be considered final and a screen certificate with a unique 15-digit computer generated number shall be displayed for printing and use as receipt.

These unique numbers would make monitoring easier for the RoC and hence, smoothen the execution of value added tax.