July 2, 2011
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Under the Companies Act, 1956, a company is required to maintain certain registers and records. There are some other registers and records, the maintenance of which is not statutorily required but is essential for the smooth, efficient and systematic functioning of the company. Some of the registers and records are required to be kept open by a company for inspection by directors and members of the company and by other persons, including creditors of the company. The right to inspect such registers and records is an enforceable right. Companies are also required to furnish extracts from certain documents, registers and records and to allow copies of certain documents, registers and records on demand by a member or by any other specified person. Government authorities have the right of access to all registers and records. Non-compliance with the provisions relating to maintenance, preservation and inspection of registers and records, to the extent they are statutory, creates punishable offences and leads to various penalties on the company, the directors and every officer in default. The term record of register is not defined in the Companies Act, 1956. Pursuant to Section 2 of the Companies Act, reference can be made to the Depositories Act, 1956 for words and expression not defined in the Companies Act, 1956. Section 2(1)(i) of the Depositories Act, 1956 define term “ record” to include the records maintained in the form of books or stored in a computer or in such other form as may be determined. Thus preliminary investigation reveals that record can be kept in the electronic format unless otherwise required under the Companies Act, 1956.