HYDERABAD: In a shocking development, a whopping 114 companies have been found to be operating out of a single room inside Fortune Monarch mall in Jubilee Hills. This came to light during a raid on Wednesday, initiated by officials with the Ministry of Corporate Affairs (MCA) as part of a crackdown on shell companies. It was found that at least 50 of these companies have no active business operations. However, their organisational structure was replete with directors, their salaries and balance sheets.
It has been learnt that these companies held assets like agricultural lands and were also allegedly lending money to each other. Many of these firms showed losses to the tune of Rs 15 crore. Officials suspect the companies were created to circulate money. “The directors of these companies seem to be related to each other. Also, many of these directors were found to be managing about 30 companies each. Law does not allow an individual to be the director for more than 20 companies,” an official was quoted as saying by a news channel.
A source reportedly revealed that one SRSR Advisory Service is the accountant for all these companies. The advisory services’ website mentioned that the company has a share capital of Rs 4.75 crore and was involved in “legal, accounting, book-keeping and auditing activities; tax consultancy; market research and public opinion polling; business and management consultancy.” The team might raid six more locations and would file for prosecution after examining the documents they have seized.
The raid was in line with the nationwide clampdown on shell companies, that have traditionally been used to channel illicit funds. Recently, MCA also found that 1,313 listed companies across the country had not filed their annual results.