rediff.com

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  

Rediff News  All News 
Rediff.com  » Business » 1,300 listed firms did not file annual results

1,300 listed firms did not file annual results

July 02, 2018 16:35 IST

911 have been traced by the Securities and Exchange Board of India (Sebi), while the rest of the 402 are not traceable on the bourses

The ministry of corporate affairs (MCA) has identified 1,313 ‘listed’ companies that have not filed their annual results.

Of these, 911 have been traced by the Securities and Exchange Board of India (Sebi), while the rest of the 402 are not traceable on the bourses.

 

Sources told Business Standard these companies took the MCA’s permission to file Draft Red Herring Prospectus (DRHP) and then come up with an Initial Public Offering (IPO) on the bourses.

The sources said while the 402 firms sought permissions for listing and got them, they later did not file the IPO.

But since they sought permission for listing, they are in the category of listed companies.

As the 911 companies are still listed, the Sebi is investigating and may ask the BSE and National Stock Exchange to delist them so that the MCA can strike them off.

As for the remaining firms, the Registrar of Companies (RoC) has been asked to go to the recorded addresses and verify if they exist or if they are bogus companies.

If found to be on-paper firms, these would be struck off by the MCA. While action against unlisted companies can be taken by the ministry of corporate affairs, listed companies can only be reprimanded by the Sebi.

Officials from the MCA state that after various rounds of striking off companies conclude, only 400,000 are likely to be active in the actual sense.

This is nearly half the count with RoC currently. The RoC struck off 226,000 companies in the first list and then issued notices to 225,000 in the second phase of clearing the menace of shell companies.

After the government struck off 226,000 companies in the first phase, 1.1 million companies remained active with the RoC.

Once the second phase is completed by the MCA, nearly 500,000 companies would be off RoC rolls.

Meanwhile, in the first list of companies, which were struck off and then the MCA began collecting information about their transactions from banks, it was found that 80,000 of them did not have PAN.

PAN is essential for any transaction of more than Rs 50,000. So far, the government has transaction details of only 73,000 firms. These deposited Rs 240 billion at the time of demonetisation.

Meanwhile, the tax department is investigating shell companies that have tax liabilities. It had asked the corporate affairs ministry to get back these companies to the RoCs so that investigation can continue.

The tax department had also asked the corporate affairs ministry to keep the taxmen updated before striking any company off the rolls.

Photograph: Mansi Thapliyal/Reuters

Veena Mani in New Delhi
Source: