Lok Sabha Question No. 218 (UNSTARRED), answered on 2019-06-24
Subject: Shell Companies
Ministry: CORPORATE AFFAIRS
Asked by: Janardan Singh Sigriwal

## GOVERNMENT OF INDIA MINISTRY OF CORPORATE AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO.  218 ANSWERED ON MONDAY, THE 24 TH  JUNE, 2019 [ASHADA 3 , 1941 (SAKA)]

## SHELL COMPANIES

## QUESTION

## 218:SHRI JANARDAN SINGH SIGRIWAL

## Will the Minister of CORPORATE AFFAIRS कॉर्पोरेट कार्य मंत्री be pleased to state:

- (a) whether  the  Government  has  developed  any  smart  mechanism  to identify shell companies in the country;
- (b) if so, the details thereof and if not, the reasons therefor; and
- (c) the action taken so far against the shell companies during the last three years and the current year, State/ UT-wise including Bihar?

## ANSWER

THE MINISTER FOR FINANCE AND CORPORATE AFFAIRS वित्त एिं कारर्पोरेट कार्य मंत्री

(Ms. NIRMALA SITHARAMAN) ( श्रीमती निमयला सीतारमण )

(a) to (b):There is no  definition  of  the  term  'Shell  Company'  in  the Companies  Act.It  normally  refers  to  a  company  without  active  business operation  or  significant  assets,  which  in  some  cases  are  used  for  illegal purpose  such  as  tax  evasion,  money  laundering,  obscuring  ownership, benami properties etc. The Special Task Force set up by the Government to look into the issue of 'Shell Companies' has inter-alia recommended the use  of  certain  red  flag  indicators  as  alerts  for  identification  of  Shell Companies. The Government has undertaken a Special Drive for identification and strike off Shell Companies.

(c): The number of Companies de-registered for the last three years, Statewise is as given below including Bihar:

| S. No.   | Name of RoC               | No. of Shell Companies de- registered   | No. of Shell Companies de- registered   | No. of Shell Companies de- registered       |
|----------|---------------------------|-----------------------------------------|-----------------------------------------|---------------------------------------------|
|          |                           | 2016-17                                 | 2017-18                                 | 2018-19                                     |
| 01       | Delhi (NCT) and Haryana   | 1,932                                   | 47,809                                  | 24279                                       |
| 02       | Kanpur                    | Nil                                     | 6,815                                   | 6412                                        |
| 03       | Chandigarh(UT) & Punjab   | Nil                                     | 1,452 2,930                             | 3103                                        |
| 04       | Himachal Pradesh          | Nil                                     | 773                                     | 446                                         |
| 05       | J&K                       | Nil                                     | 1,550                                   | 191                                         |
| 06       | Uttrakhand                | Nil                                     | 787                                     | 377                                         |
| 07       | Ahmedabad                 | Nil                                     | 11,435                                  | 5408                                        |
| 08       | Gwalior                   | Nil                                     | 4,699                                   | 1581                                        |
| 09       | Jaipur                    | Nil                                     | 5,046                                   | 3201                                        |
| 10       | Bilaspur                  | Nil                                     | 904                                     | 466                                         |
| 11       | Arunachal Pradesh         | 03                                      | 15                                      | 298                                         |
| 12       | Assam                     | 37                                      | 198                                     |                                             |
| 13       | Nagaland                  | 01                                      | 10                                      |                                             |
| 14       | Manipur                   | Nil                                     | 09                                      |                                             |
| 15       | Meghalaya                 | 08                                      | 30                                      |                                             |
| 16       | Mizoram                   | 03                                      | 02                                      |                                             |
| 17       | Tripura                   | 02                                      | 16                                      |                                             |
| 18       | West Bengal               | Nil                                     | 8,078                                   | 7145                                        |
| 19       | Odisha                    | Nil                                     | 1,824                                   | 1905                                        |
| 20       | Bihar                     | Nil                                     | 1,557                                   | 2381                                        |
| 21       | Jharkhand                 | Nil                                     | 634                                     | 1330                                        |
| 22       | AP and Telangana          | Nil                                     | 38580                                   | 18322                                       |
| 23       | Chennai & Coimbatore      | Nil Nil                                 | 20,672 3,977                            | 6860 ( including Andaman & Nicobar Islands) |
| 24       | Kochi                     | Nil                                     | 4,063                                   | 2821                                        |
| 25       | Puducherry (UT)           | Nil                                     | 571                                     | 13                                          |
| 26       | Andaman & Nicobar Islands | Nil                                     | 75                                      | -                                           |
| 27       | Mumbai                    | Nil                                     | 49,964                                  | 24384                                       |
| 28       | Pune                      | Nil                                     | 9,930                                   | 1726                                        |
| 29       | Goa                       | Nil                                     | 1,761                                   | 148                                         |
| Total    | Total                     | 1986                                    | 2,26,166                                | 1,12,797                                    |

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