​2.09 lakh companies deregistered; directors face action: Government




About the directors and signatories of the over 2.09 lakh firms, the government said they would not be able to operate bank accounts of such companies till these entities are legally restored. NEW DELHI: Bank accounts of more than 200,000 shell companies have been frozen after they were struck off the Register of Companies as the government intensifies its crackdown against black money. The government urged banks to step up diligence while dealing with companies in general.

“Banks will also flag such firms which are not complying with the mandatory (regulatory) filings,” said financial services secretary Rajiv Kumar, adding that the move will ensure compliance in the corporate sector.

In his Independence Day speech, Prime Minister Narendra Modi had said the drive against black money had led to the discovery of a vast number of shell companies.

“Following demonetisation, over 3 lakh companies have been found which are nothing but shell companies,” he had said on August 15, noting that up to 400 bogus firms were found to be operating from a single address. Section 248 of the Companies Act allows the removal of companies from the register on various grounds, including having been inactive for extended periods.

The government said in August that 37,000 shell firms had been identified as having engaged in concealing black money and hawala transactions following demonetisation, announced in November last year.

About 160 of these shell companies that were listed on exchanges were suspended from trading, pending submission of evidence proving their bona fides.

Taking this forward, the government restricted the bank accounts of such firms. The department of financial services advised banks that even companies with an active status on the corporate affairs ministry website but failing to make mandatory financial disclosures “should be seen with suspicion as, prima facie, the company is not complying with its mandatory statutory obligations to file this vital information for availability to its stakeholders,” according to a press release.

The government said the directors and authorised signatories of such struck-off companies will no longer hold those posts.

“These individuals will therefore not be able to operate bank accounts of such companies till such companies are legally restored under Section 252 of the Companies Act by an order of the National Company Law Tribunal,” it said.

The statement noted that the measures have been taken as the government has stepped up decisive action against companies falling within the ambit of Section 248 of the Companies Act.

“The restoration, as and when it happens shall be reflected by change in the status of the company from ‘struck off ’ to ‘active’,” the statement said. Since such ‘struck-off ’ companies have ceased to exist, action has been initiated to restrict the operation of their bank accounts.

“The department of financial services has, through the Indian Banks’ Association, advised all banks that they should take immediate steps to put restrictions on bank accounts of such struck-off companies,” the statement said. A list of such companies has been published on the website of the corporate affairs ministry.




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