New Delhi: Hundreds of Shell companies which have seen deposits and withdrawal running into several crores post government's note ban announcement last year face criminal action, media reports have said.


COMMERCIAL BREAK
SCROLL TO CONTINUE READING

Under the revamped Companies Act, relating to fraud, the law provides for imprisonment of three to 10 years in case of fraud. A penalty equal to the value of the offence may also be added, reports further said.


The Ministry of Corporate Affairs (MCA) this month disqualified more than two lakh directors of shell companies, for not filing their financial statements or annual returns for two straight years, violating provisions of the Companies Act, 2013.


Last month, the government imposed restrictions on operations of bank accounts of over 2 lakh 'struck-off' companies.


Terming it as a "major breakthrough" in fight against black money and shell companies, it said the first instalment of data pertains to about 5,800 companies -- out of more than 2 lakh that were struck off -- involving 13,140 accounts.


With PTI Inputs