Govt to take action against 2.26 lakh shell companies

The task force on shell companies has met eight times since its constitution and has taken pro-active and coordinated steps to check the menace of shell companies, said a note by Ministry of Finance.

The Government of India appointed task force has identified nearly 2,25,910 shell firms, which will be removed from the register of companies in the current financial year. 
 
As per an official note by Ministry of Finance on Friday, "An opportunity of being heard will be given to these identified companies and LLPs by way of notices regarding their default and the proposed action. Appropriate action will be taken after considering their response."
 
The task force on shell companies has met eight times since its constitution and has taken pro-active and coordinated steps to check the menace of shell companies. 
 
The task force was set up in February month last year by the Prime Minister’s Office (PMO) under the joint chairmanship of the Revenue Secretary and Secretary, MCA.
 
The mandate of the task force was to check shell companies in a systematic way, through a coordinated multi-agency approach.
 
"The mechanism for sharing of documents and information amongst all the law enforcement agencies has been put in place. Standard Operating Procedure regarding ‘Sharing of Documents’ has been finalised and circulated amongst all the law enforcement agencies for compliance," note said. 
 
The task force is the appellate authority for this purpose. 
 
Ministry of Finance said the Standard Operating Procedure for sharing of information amongst the various law enforcement agencies has also been finalised and circulated by Central Economic Intelligence Bureau, which is the nodal agency for this purpose.
         
The Ministry of Corporate affairs will also be launching a public awareness campaign soon to make the public aware of the need to get the registrations of their defunct companies cancelled themselves.
 
The government expects that it’s efforts to clean up the registry will create a transparent and compliant corporate ecosystem in India, promote the cause of ‘ease of doing business’ and enhance the trust of the public.
 
Source: PIB

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