Replacing Affidavits with Self Declaration

22 June 2022 • Ashna & Ridhima

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Replacing Affidavits with Self Declaration

22 June 2022 • Ashna & Ridhima

Ironically, records of what you do is more important than what you do. Write it down and then it’s real

…. Allan Watts. 

Affidavit is a written statement confirmed by oath or affirmation, for use as evidence in court. In order to enhance the mutual relationships between the government and citizens of India, the government of many states, like Punjab, Himachal Pradesh and Delhi, have come up with the initiative of replacing affidavits with self-declarations in Public Service Delivery Systems in India. This initiative of many state governments has been welcomed by the central government as it not only reduces the formalities and complexities in the process but also takes mutual trust between government and citizen one step forward.

With a view to reap benefits of replacing affidavits with self-declaration, the Company Law Committee in its report considered replacing affidavits with self-declaration under certain provisions of Companies Act, 2013 which have been tabulated in the later part of the article.

AFFIDAVIT V/S SELF-DECLARATION

BENEFITS OF SELF-DECLARATION

  • It is not required to be given on stamp paper
  • It is not required to be notarized by a public notary
  • It reduces the cost, time and efforts required
  • Enables swifter delivery of public services to citizens thereby promoting ease of doing business

REPLACING AFFIDAVITS WITH SELF DECLARATION UNDER THE PROVISIONS OF THE COMPANIES ACT, 2013

The Committee recommends replacing affidavits with self-declaration under the following provisions of the Companies Act, 2013.

S.No. Provisions under Companies Act, 2013 read with Rules made thereunder Purpose of Affidavit
1. Section 68(6) read with Rule 17(3), Companies (Share Capital and Debenture) Rules, 2014 It requires the company to file declaration of solvency with ROC and SEBI along with an Affidavit by at least 2 directors
2. Section 374(c) Company seeking registration under Chapter XXI Part I is required to file an affidavit from all members/ partners that in the event of registration, necessary documents or papers shall be submitted to the registering or other authority with which the company was earlier registered.
3. Rule 7(4)(i), Companies (Incorporation) Rules, 2014 A company which intends to convert itself into a One Person Company is required to make an application to ROC along with an affidavit stating that all members and creditors of the company have given their consent for conversion.
4. Rule 8A(1)(j), Companies

(Incorporation) Rules, 2014

Section 8 following the Electoral Trust Scheme, 2013, company may register with a name including the phrase Electoral Trust by making an application along with an affidavit stating that the name obtained shall be only for registration of companies under the said scheme.
5. Rule 10(3)(b), Companies

(Registration of Foreign Companies) Rules, 2014

Foreign companies are required to attach translation of their documents, where documents submitted to ROC are not in English language and it is required to be authenticated by an affidavit.
6. Rule 4(3)(iii), The Companies (Removal of Names of Companies

from the Register of Companies) Rules, 2016

The application made by the company for removal of its name is required to be accompanied with an affidavit by every director of the company.

Exclusions: Provisions where filing of affidavit is required in judicial or quasi-judicial proceedings before NCLT/NCLAT or RD do not fall under the ambit of replacement of Affidavits.

CONSEQUENCES OF FURNISHING FALSE SELF-DECLARATION

Furnishing of self-declaration in place of affidavit will not devolve upon the liability and accountability of the person furnishing it. Submission of false declaration shall attract penal consequences as mentioned under-

  • Section 448 of the Companies Act, 2013
  • Section 197 of the India Penal Code, 1860

CONCLUSION

The proposal by the Company Law Committee to replace affidavits by self-declaration in some cases are mere recommendations at the moment. We are very hopeful that the Government will act on these recommendations and will suitably amend the law. Replacing affidavits with self-declaration will be a right step in the direction of promoting ease of doing business and reducing procedural requirements. It will not only reduce the timelines of the process but will also add onto the mutual trust between the governments and citizens.

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