1.78 lakh companies deregistered, says Jaitley in Lok Sabha

Union corporate affairs minister Arun Jaitley on Friday said in the Lok Sabha that speedy steps are being taken against shell companies.

Published: 12th August 2017 12:51 AM  |   Last Updated: 12th August 2017 08:28 AM   |  A+A-

Union Finance Minister Arun Jaitley. (File photo | PTI)

Union corporate affairs minister Arun Jaitley. (File photo | PTI)

By Express News Service

NEW DELHI: The government’s efforts to simplify the process for registration of companies under its policy of ease of doing business have apparently been misused by shell companies.

Union corporate affairs minister Arun Jaitley on Friday said in the Lok Sabha that speedy steps are being taken against shell companies but a balance needs to be maintained between ease of doing business and ensuring that the firms are not misused. As many as 1.78 lakh firms that have not been carrying out business activities for long have been deregistered, he said.

Jaitley said there is no definition for shell companies under the Companies Act but such entities are used for round tripping of money.

“The real owners behind such entities need to be identified and expeditious steps are being taken under the benami and Income Tax laws,” the minister said during Question Hour.

He acknowledged turmoil in the market after market regulator Sebi had asked stock exchanges to take action against 331 suspected shell companies which were referred to it by the Corporate Affairs Ministry.

Jaitley was responding to a supplementary question by a Congress member and said that there is a distinction between dormant and shell companies.

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