Corporate Affairs Ministry to De-Register 1.2 Lakh Firms

Corporate Affairs Ministry to De-Register 1.2 Lakh Firms

The latest decision to strike off an additional 1.20 lakh companies from the official records came after a review meeting of the actions taken with respect to deregistered firms last week. Minister of State for Corporate Affairs P P Chaudhary, who chaired the review meeting, has directed officials to expedite action against the companies.

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On the other hand, in its bid to streamline the internal taxation structure, nearly 2.26 lakh companies have already been deregistered from official records and around 3.09 lakh directors associated with those firms have been disqualified.

The government, however, said it has decided to strike off the names of 1.20 lakh more companies from the official records, for various non-compliances, as part of its continuing fight against the black money menace. Nearly 2.26 lakh companies have already been deregistered and around 3.09 lakh directors associated with those entities have been disqualified.

The latest decision to strike off an additional 1.20 lakh companies from the official records came after a review meeting of the actions taken with respect to deregistered firms last week. Minister of State for Corporate Affairs P P Chaudhary, who chaired the review meeting, has directed officials to expedite action against the companies that are to be struck off the records.

For various non-compliances, around 1,20,000 more companies have been identified for striking-off, the Corporate Affairs Ministry said in a release. Till the end of December 2017, over 2.26 lakh companies were deregistered for various non-compliances and being inactive for long. These moves are part of larger efforts to curb illicit fund flows. According to the release, 1,157 cases had been filed with the National Company Law Tribunal (NCLT) for restoration of deregistered companies.

“Out of these cases, NCLT had given orders for considering restoration of 180 companies, of which 128 companies have already been restored by the concerned Registrars of Companies (ROCs) after completion of the requisite compliance formalities,” it said.

With respect to 992 court cases pertaining to disqualification of directors that are pending with various high courts, the ministry said around 190 cases have been disposed of.  Besides, the Minister has asked for handling cases under the Condonation of Delay Scheme on a priority basis in order to ensure that eligible companies can avail the benefit. The scheme, which would be operational till March 31, 2018, provides an opportunity for defaulting companies to submit their filings. The Ministry also said there is now a trend of increasing compliance after the striking-off and disqualification exercise. More and more companies are coming forward to file their annual returns and statements on the MCA21, it added.

All filings under the Companies Act are to be made through the MCA21 portal. The minister emphasised that message should be sent out to company secretaries and directors of all companies to ensure that filings are made on time, which would also help prevent unnecessary litigation and prosecution. Chaudhary said the ministry ensures that principles of good corporate governance are followed in letter and spirit and an atmosphere of trust prevails for the investors.

“Similarly, it is important to ensure that unscrupulous elements do not misuse the corporate governance channels to defraud innocent investors. A fair, transparent and accountable corporate governance ecosystem shall form the bedrock of sustained high economic growth in new India,” he added.

The government said it has cut the size of additional borrowing to Rs 20,000 crore of government securities during the current fiscal.  On December 27, the government had stated that it would raise additional market borrowing of Rs 50,000 crore through dated government securities in 2017-18.

“Upon a review of trends of revenue receipts and expenditure pattern, it has been assessed that additional borrowing of only Rs 20,000 crore of government securities would be adequate to meet financing needs,” an official statement from the Finance Ministry said.  “Government did not accept borrowings of Rs 15,000 crore in last three auctions. Remaining Rs 15,000 crore would be reduced from the notified borrowing programme of ensuing weeks,” it added.

 

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