Crackdown on shell companies: Govt freezes bank accounts of 2.09 lakh firms

 BT Online        Last Updated: September 5, 2017  | 19:37 IST

Finance Ministry on Tuesday said that operations of bank accounts of over 2 lakh ‘struck off’ companies has been restricted by the government.

The existing Directors and Authorized Signatories of such struck off companies will now become ex Directors or ex Authorized Signatories, the Finance Ministry tweeted. “These individuals will not be able to operate bank accounts till such companies are legally restored by an order of the NCLT,” it added.

Government has stepped up decisive action against companies falling within the ambit of Section 248 of the Companies Act. The names of 2,09,032 companies have been struck off from the Register of Companies under Section 248 (5) of the Act, a government release said.

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. The restoration, as and when it happens shall be reflected by change in the status of the company from ‘Struck off’ to ‘Active’,” it added.

Continuing its crackdown on shell companies which are allegedly used as conduits for illicit fund flows and tax evasion, Department of Financial Services has advised all banks through Indian Banks Association (IBA) to take immediate steps to put restrictions on bank accounts of struck-off companies.

Since such ‘struck off’ companies have ceased to exist, action has been initiated to restrict the operation of Bank accounts of such companies. A list of such companies, Registrar of Companies wise, has been published on the website of the Ministry of Corporate Affairs, an official release said.

“In addition to such struck off companies, Banks have also been advised to go in for enhanced diligence while dealing with companies in general. A company even having an active status on the website of the Ministry of Corporate Affairs but defaulting in filing of its due Financial Statement (s) or Annual Return (s) of Particular of Charges on its assets on the secured loan 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. obligations,” it added.

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