In a massive move by Ministry of Corporate Affairs, around 2.24 lakh companies have been struck-off for remaining inactive for a period of two years or more.
Following the step, the bank accounts of these companies have been restricted in accordance with law. Apart from the restrictions on bank accounts, action has also been taken to restrict sale and transfer of movable and immovable properties of these companies.
The information with respect to such companies has been shared with enforcement authorities, including Central Board of Direct Taxes(CBDT), Financial Intelligence Unit (FIU), Department of Financial Services (DFS) and Reserve Bank of India (RBI) etc., for further necessary action.
Separately, action has also been taken to disqualify Directors on the Board of Companies that have failed to file Financial Statements and/or Annual Returns for a continuous period of three financial years during 2013-14 to 2015-16. Around 3.09 lakh Directors have been affected by this action.
In order to address the criminality angle, the Director, Additional Director or Assistant Director of SFIO have been recently authorized to arrest any person believed to be guilty of any fraud punishable under the Act. Under Section 447 of the Act, which defines fraud, stringent punishment including imprisonment up to 10 years is stipulated. Further, reference has been made to the Ministry of Finance to include it as a Scheduled Offence under the Prevention of Money Laundering Act.