False statement/declaration in csr report is an offence!!

News reporter

Dear Friends,

one MNC opens a subsidiary in India and registers it under Companies Act,1956.

The parent American  Company makes some declaration/statement in its Annual Sustainability & Corporate Responsibility Report about some good policies/benefits/facilities for safety of  Employees  working with it .On correspondence with the Indian Subsidiary ,it was found that the same policies/benefits were not being provided to Employees working for Indian subsidiary which resulted in one of the employee losing his life due to an accident arising during course of employment.Had the measures/facilities as declared in Annual Sustainability & Corporate Responsibility Report been adopted for employees working for Indian Subsidiary,the accident would have been avoided.My Question is:

1-Since the Indian Subsidiary is being controlled by American MNC,can the statement in Annual Sustainibility & Corporate Responsibility Report be equally implied for Indian Subsidiary too,ie it may be considered as an statement by Indian Subsidiary!!?

2-If the answer to question 1 is yes,then Making of False Statement in Annual Sustainibility & Corporate Responsibility Report amounts to a Criminal Offence under Companies Act/IPC?

3-The company had admitted some potential risk attached with the kind of work its employees are doing & has listed measures to safe gaurd its employees but nothing such happened,thus an employee losing his life because of same risk and in absence of any preventive measures.Under what sections of IPC/Companies Act can the Management of Indian Subsidiary be Impeached for making such a false declaration?

Kindly elaborate

warm regards

Vinay kumar

 
Reply   
 
ADVOCATE AND CORPORAE ADVISOR

THE FOREIGN COMPANY BASED IN USA CAN BE PENALISED S.E.C.  SECURITY EXCHANGE COMMISSION.

 

INDIAN COMPANY CAN ALSO BE PUNISHED UNDER VARIOUS LAWS.

 

THIS IS A BAD DISCLOSURE AND BAD CORPORATE GOVERNANCE. APPROPRIATE ACTION CAN BE INITIATED.

 

DR VEDULA GOPINATH

ADVOCATE AND CORPORATE ADVISOR

RESEARCHER IN CORPORATE GOVERNANCE

vgopinath2@yahoo.com    09848227926    Hyderabad ap India

 
Reply   
 


News reporter

Dear Sir, 1-What action can be initiated against company & under which laws. 2-If a Criminal Liability can be imposed upon them?Kindly Explain.It is of urgent nature. Warm Regards Vinay
 
Reply   
 

LEAVE A REPLY


    

Your are not logged in . Please login to post replies

Click here to Login / Register  



 

Search Forum:








×

  LAWyersclubindia Menu