557,000 firms struck off due to non-compliance with law provisions | Business Standard News*

Clipped from: https://www.business-standard.com/article/companies/557-000-firms-struck-off-due-to-non-compliance-with-law-provisions-122121300879_1.html

Minister of State for Corporate Affairs Rao Inderjit Singh said that the term ‘shell company’ is not defined under the Act

Companies, PSUs, investors, investments, growth

More than 5.57 lakh companies were struck off the records in the last five years due to non-compliance with various provisions of the companies law, according to the government.

Minister of State for Corporate Affairs Rao Inderjit Singh on Tuesday said that 5,57,055 companies were struck off under Section 248 of the Companies Act, 2013 read with the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 in the country in the last five years.

They were struck off due to non-compliance with provisions of the Act, he said in a written reply to Rajya Sabha.

He also said that the term ‘shell company’ is not defined under the Act. It normally refers to a company without active business operation or significant assets, which in some cases are used for illegal purpose such as tax evasion, money laundering, obscuring ownership and benami properties, he added.

Further, the minister said the special task force set up by the government to look into the issue of ‘shell companies’ has inter-alia recommended the use of certain red flag indicators as alerts for identification of shell companies.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s