The Ministry of Corporate Affairs (MCA) on Sunday said it has struck off around 2.24 lakh companies post demonetisation, for remaining inactive for a period of two or more years.
A preliminary inquiry from 56 banks in respect of 35,000 companies, which involve approximately 58,000 accounts, has revealed that over Rs. 17,000 crore was deposited and withdrawn post demonetisation.
In a particular case, a company which had a negative opening balance on November 8 deposited and withdrew Rs. 2,484 crore post demonetisation, according to a notification from the MCA.
Apart from the restrictions on bank accounts, action has also been taken to restrict sale and transfer of moveable and immoveable properties of struck off companies.
The State governments have been asked to look into these transactions and take appropriate action.
Moreover, the prime minister's office has constituted a Special Task Force (STF) under joint chairmanship of revenue secretary and secretary, corporate affairs, to oversee the drive against such defaulting companies with the help of various enforcement agencies.
The STF has so far met five times and action has been initiated against several defaulting companies, which is expected to help in the drive against black money.
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.
Preliminary inquiry has shown that over 3,000 disqualified directors are directors in more than 20 companies each, which is beyond the limit prescribed under the law.
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 Ministry of Finance to include it as a scheduled offence under the Prevention of Money Laundering Act.
A high-level committee has been constituted for suggesting revamp of the disciplinary systems of chartered accountants, company secretaries and cost accountants.
Moreover, steps are underway for setting up National Financial Reporting Authority (NFRA), an independent body, to test check financial statements, prescribe accounting standards, and take action against errant professionals.
The MCA also said that it has taken several steps to end the practice of dummy directors including seeding Director Identification Number (DIN) with permanent account number (PAN) and Aadhaar at the time of DIN application through biometric matching for new applications.