Lok Sabha Question No. 3885 (UNSTARRED), answered on 2026-03-16
Subject: Action against Shell companies
Ministry: CORPORATE AFFAIRS
Asked by: Shri Harish Chandra Meena

## GOVERNMENT OF INDIA MINISTRY OF CORPORATE AFFAIRS LOK SABHA UN-STARRED QUESTION NO. 3885 ANSWERED ON MONDAY, MARCH 16, 2026

Action against Shell companies

## QUESTION

3885. Shri Harish Chandra Meena:

Will the Minister of CORPORATE AFFAIRS be pleased to state:

- (a) the number of registered companies in the country identified as shell companies,  dummy  companies  or  companies  found  to  be  involved  in suspicious financial transactions during the last five years alongwith the State-wise details thereof;
- (b)  the  number  of  registered  companies  in  the  State  of  Rajasthan identified as shell companies, dummy companies or companies found to be involved in suspicious financial transactions during the last five years along with the details of the nature of action taken by the Government against such companies; and
- (c)  whether  the  Government  has  entrusted  any  Central  Investigating Agency to investigate  cases  relating  to  illegal  money  laundering,  land transactions and tax evasion being done by such companies and if so, the details thereof?

## ANSWER

Minister of State in the Ministry of Corporate Affairs; Minister of State in the Ministry of Road Transport and Highways.

(Shri Harsh Malhotra)

(a) & (b): The term 'Shell Company' or ' Dummy Company ' is not defined in the Companies Act, 2013 (Act). However, this Ministry takes enforcement action  under  sections  206/  210/  212  of  the  Act  in  the  form  of  inquiry, inspection  and  investigation  (3is)  against  companies  alleged  to  be involved in suspicious financial transactions/ fraud including noncompliance of various provisions of the Companies Act, 2013.

On the basis of reports of the Registrars of Companies, Regional Directors and  Serious  Fraud  Investigation  Office  (SFIO),  the  Ministry  issues instructions  for  taking  necessary  penal  action.  State-wise  details  of companies penalized are at Annexure A. Further, the Ministry also carries out strike off drive under section 248(1) of the said Act for striking off such companies which are not carrying on any  business  or  operation  for  a  period  of two  immediately  preceding financial years and has not made any application within such period for obtaining the status of a dormant company under section 455 of the Act or a company has failed to commence its business within one year of its incorporation or the subscribers to the memorandum have not paid the subscription which they had undertaken to pay at the time of incorporation of a company and a declaration to this effect has not been filed within one hundred and eighty days of its incorporation under section 10A(1)  of  the  Act  or  the  company  is  not  carrying  on  any  business  or operations, as revealed after the physical verification carried out under section 12(9) of the said Act. The details of action taken under section 248(1) of the said Act is at Annexure B. (c): As the term ' Shell Company ' or ' Dummy Company ' is not defined under the  Companies  Act,  2013,  the  requisite  information  is  not  maintained. However details of Companies observed to be indulging in suspicious/potentially  fraudulent  transactions  are  shared  by  Financial Intelligence  Unit  (FIU)  reports,  CEIB  (Central  Economic  Intelligence Bureau) references, SLCC (State Level Co-ordination Committee) with the Ministry which serves as important inputs in taking up 3is under Sections 206(4), 206(5) and 210 of the Companies Act, 2013, respectively. Further, in the matter of serious frauds, investigation is assigned to the SFIO under Section 212 of the Companies Act, 2013. The  findings  of  the  Inquiry/  Inspection/  Investigation  reports  are  also shared  with  enforcement  agencies  like  Enforcement  Directorate  (ED), Income Tax (IT) Department, and GST Authorities as the case may be, to enable further course of action against such companies and individuals associated with such companies.

- ******

Annexure -A

## In reply to part (a & b) of Unstarred Lok Sabha Question no. 3885

## Total number of companies penalised for non-compliance

| S. No.    | Name of State/ UT   |   2020-21 |   2021-22 |   2022-23 |   2023-24 |   2024-25 |
|-----------|---------------------|-----------|-----------|-----------|-----------|-----------|
| 1.        | Andhra Pradesh      |         0 |         8 |       136 |        21 |         7 |
| 2.        | Arunachal Pradesh   |         0 |         0 |         0 |         0 |         0 |
| 3.        | Assam               |         2 |         4 |         4 |         4 |         9 |
| 4.        | Bihar               |         3 |        14 |        55 |        31 |        19 |
| 5.        | Chandigarh          |         3 |         6 |         2 |         3 |        10 |
| 6.        | Chhattisgarh        |         0 |        19 |         7 |        68 |        34 |
| 7.        | Dadar and           |         0 |         0 |        01 |        03 |        01 |
| 8.        | Goa                 |         0 |         0 |         5 |         0 |         9 |
| 9.        | Gujarat             |         5 |        47 |       152 |       169 |        57 |
| 10.       | Haryana             |         2 |         5 |        29 |        37 |        19 |
| 11.       | Himachal            |         0 |         0 |         0 |         2 |         2 |
| 12.       | Jharkhand           |         0 |         0 |         0 |         0 |         1 |
| 13.       | Karnataka           |        89 |        98 |        66 |        93 |       202 |
| 14.       | Kerala              |        89 |        24 |        98 |        11 |        20 |
| 15.       | Madhya              |        14 |        29 |        17 |        68 |        16 |
| 16.       | Maharashtra         |        10 |        15 |        36 |       144 |       211 |
| 17.       | Manipur             |         0 |         0 |         0 |         0 |         0 |
| 18.       | Meghalaya           |         0 |         0 |         0 |         1 |         0 |
| 19.       | Mizoram             |         0 |         0 |         0 |         0 |         0 |
| 20.       | Nagaland            |         0 |         0 |         0 |         0 |         0 |
| 21.       | NCT of Delhi        |        52 |        31 |       110 |       141 |       135 |
| 22.       | Odisha              |         4 |        10 |        12 |         7 |         3 |
| 23.       | Puducherry          |         6 |         1 |        10 |        10 |         9 |
| 24.       | Punjab              |         5 |        15 |         3 |        11 |        23 |
| 25.       | Rajasthan           |         3 |         3 |        21 |        23 |         3 |
| 26.       | Tamil Nadu          |        20 |        26 |        89 |        56 |       139 |
| 27.       | Telangana           |         6 |        22 |         8 |         7 |        18 |
| 28.       | Tripura             |         0 |         0 |         0 |         0 |         0 |
| 29.       | UT of Jammu         |         0 |         0 |         2 |         2 |         0 |
| 30. UT of | Ladakh              |         0 |         0 |         0 |         0 |         0 |

| S. No.   | Name of State/ UT       |   2020-21 | 2021-22   |   2022-23 |   2023-24 |   2024-25 |
|----------|-------------------------|-----------|-----------|-----------|-----------|-----------|
| 31.      | Uttar Pradesh 0         |        22 |           |         3 |        18 |        80 |
| 32.      | Uttarakhand             |         0 | 0         |         1 |         3 |         2 |
| 33.      | West Bengal             |         5 | 5         |        34 |        47 |        37 |
| 34.      | UT of Andaman & Nicobar |         0 | 0         |         0 |         0 |         0 |
| 35.      | UT of Lakshadweep       |         0 | 0         |         0 |         0 |         0 |
|          | Total                   |       318 | 404       |       901 |       980 |      1066 |

Annexure B

In reply to part (a & b) of Unstarred Lok Sabha Question no. 3885

Action taken u/s 248(1) of Companies Act, 2013

| Years   | Pan India   | Rajasthan   |
|---------|-------------|-------------|
| 2020-21 | 217         | 0           |
| 2021-22 | 28,305      | 1,210       |
| 2022-23 | 68,893      | 1,453       |
| 2023-24 | 0           | 0           |
| 2024-25 | 0           | 0           |
| Total   | 97,415      | 2,631       |