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NEW DELHI : The Registrar of Companies (RoC) has started an inquiry into the affairs of MG Motor India and has summoned the company’s top brass along with the company’s statutory auditor later this month, a person familiar with the development said.
The RoC inquiry is instituted under a provision in the Companies Act which involves more than a step of seeking information but is short of full-fledged investigation, the person said. The inquiry is around suspected financial irregularities but it is too early to comment upon that, the person said.
MG Motor India acknowledged the RoC communication and said it is a law-abiding, professionally managed company that adheres to the highest standards of compliance and governance and is committed to transparency.
“We have been sent a notice seeking clarifications primarily on why we have operational losses basis our annual report for the first year of operations 2019-2020. We fully co-operate with the government authorities on all issues and are in process of providing the desired records and information to the Registrar of Companies within the stipulated time frame,” the company said in a statement.
“At the same time, we would also like to state that it is impossible for any automobile company to be profitable in the very first year of its operations,” the statement said, adding this is because of the huge capex investment required and the long gestation period in the highly competitive market.
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John Miller has been writing about science, gaming, and tech culture for over a decade. He’s a top-rated reviewer with extensive experience helping people find the best deals on tech and more.
