Government crackdown on “shell companies” have revealed that around 35,000 of the 2.24 Lakh companies who names have been struck off, deposited over Rs 17,000 Crore following last year's November 8 demonetisation drive. One to stand out was a company with a negative opening balance on the day the announcement was made by Prime Minister Narendra Modi, deposited and withdrew Rs 2484 Crore post-demonetisation.
The Finance Ministry released a statement saying a company had as many as 2134 accounts and data for such entities had been shared with enforcement authorities, including the Central Board of Direct Taxes, Financial Intelligence Unit (FIU), department of financial services and the Reserve Bank of India for further action. It said that several companies have also been identified for inquiry/inspection/investigation under the Companies Act, 2013, and necessary action is underway. So far, 2 Lakh companies that were inactive for two years or more and did not file statutory reports, have been de-registered, and over 3 Lakh directors have been disqualified. The government said, “Preliminary enquiry has shown that over 3000 disqualified directors are directors in more than 20 companies each, which is beyond the limit prescribed under the law.”
Also, banks have been asked to freeze accounts of such companies, and share data with the government. 56 banks have shared information involving 58,000 companies so far, and more information is expected to be received in the next few months. The initiative is being undertaken by a special task force set up by the PMO, co-chaired by Revenue Secretary Hasmukh Adhia and Corporate Affairs Secretary I Srinivas. Along with several corrective measures to tighten regulations, the government is also initiating criminal investigation under new provisions of the Companies Act.
The government said, “Under Section 447 of the Act, which defines fraud, stringent punishment, including imprisonment up to to 10 years, is stipulated. Further, reference has been made to the ministry of finance to include it as a Scheduled Offence under the Prevention of Money Laundering Act.”
