HARSH ACTION AGAINST SHELL COS: CENTRE

New Delhi, Feb. 10: In a major crackdown on domestic shell companies, the government on Friday decided to take “harsh punitive” action, including freezing of their bank accounts used to launder money or evade taxes.

Following a review by the Prime Minister's Office, a task force with members from regulatory ministries and enforcement agencies has been constituted to monitor action against “deviant” shell companies.

While the Serious Fraud Investigation Office (SFIO) has filed cases against 49 shell companies, as much as `3,900 crore have been laundered by 559 persons with the help of 54 professionals. Also, `1,238 crore cash has been deposited in shell or dormant companies, post demonetisation. “There are about 15 lakh registered companies in India and only 6 lakh companies file their annual return. This means a large number of these companies may be indulging in financial irregularities,” a PMO statement said.

A task force, headed by revenue and corporate affairs secretaries, with members from various regulatory ministries and enforcement agencies has been set up to monitor the actions taken against such deviant shell firms by various agencies.

“Harsh punitive actions will be taken against the deviant shell companies which will include freezing of bank accounts, striking off the names of dormant companies, invocation of Benami Transactions (Prohibition) Amendment Act, 2016,” it said. – PTI