Skip to main content

Define'shell companies' in companies act, panel asks govt

By
Define'shell companies' in companies act, panel asks govt
At present, the term 'shell company' is not defined under the Companies Act, which is implemented by the corporate affairs ministry
A Parliamentary panel has asked the government to define "shell company" in the Companies Act and ensure distinction between those guilty of fraud and those irregular with filings.
The recommendation assumes significance at a time when the government is cracking down on companies that have not been carrying out business activities for long as well as those entities being allegedly used for illicit fund flows.As part of larger efforts to curb the black money menace, the corporate affairs ministry has already struck off the names of more than 226,000 companies from the official records besides disqualifying a large number of directors associated with such entities.
The Parliamentary Standing Committee on Finance, headed by senior Congress leader and former Corporate Affairs Minister M Veerappa Moily, has said that out of the 226,000 deregistered companies some may have been merely dormant ones without any fraudulent intent.
"Therefore, it is necessary that while cracking down on shell companies, the ministry needs to make distinction between those guilty of fraud and those irregular with filings," the panel said in a report tabled in Parliament on March 9.At present, the term 'shell company' is not defined under the Companies Act, which is implemented by the corporate affairs ministry.
"To avoid any legal ambiguity and pre-empt avoidable litigation in the absence of a clear cut definition of 'shell companies' may be suitably included in the Act itself by bringing in the element of 'fraudulent' intent," the committee said.According to the report, the ministry has decided to attempt a commonly accepted definition and attributes of shell companies.Amid instances of corporate frauds, the panel has also called for "real time data sharing" among the ministry and other agencies.
"To prevent corporate misfeasance/ malfeasance, there should be real time data-sharing amongst Ministry of Corporate Affairs and other regulatory enforcement agencies such as CBI, ED, DRI, CBDT, SFIO, Department of Financial Services, Financial Intelligence Unit, Central Economic Intelligence Bureau and Sebi," it said. In this regard, the committee has said that it may be apprised of the progress made within three months.
The Business Standard, New Delhi, 12th March 2018

Comments

Post a Comment

Popular posts from this blog

New income tax slab and rates for new tax regime FY 2023-24 (AY 2024-25) announced in Budget 2023

By
  Basic exemption limit has been hiked to Rs.3 lakh from Rs 2.5 currently under the new income tax regime in Budget 2023. Further, the income tax slabs in the new tax regime has been changed. According to the announcement, 5 income tax slabs will be there in FY 2023-24, from 6 income tax slabs currently. A rebate under Section 87A has been enhanced under the new tax regime; from the current income level of Rs.5 lakh to Rs.7 lakh. Thus, individuals opting for the new income tax regime and having an income up to Rs.7 lakh will not pay any taxes   The income tax slabs under the new income tax regime will now be as follows: Rs 0 to Rs 3 lakh - 0% tax rate Rs 3 lakh to 6 lakh - 5% Rs 6 lakh to 9 lakh - 10% Rs 9 lakh to Rs 12 lakh - 15% Rs 12 lakh to Rs 15 lakh - 20% Above Rs 15 lakh - 30%   The revised Income tax slabs under new tax regime for FY 2023-24 (AY 2024-25)   Income tax slabs under new tax regime Income tax rates under new tax regime O to Rs 3 lakh 0 Rs 3 lakh to Rs 6 lakh 5% Rs 6
Post a Comment
Read more

Jaitley plans to cut MSME tax rate to 25%

By
Income tax for companies with annual turnover up to ?50 crore has been reduced to 25% from 30% in order to make Micro, Small and Medium Enterprises (MSME) companies more viable and also to encourage firms to migrate to a company format. This move will benefit 96% or 6.67 lakh of the 6.94 lakh companies filing returns of lower taxation and make MSME sector more competitive as compared with large companies. However, bigger firms have shown their disappointment since the proposal for reducing tax rates was to make Indian firms competitive globally and it is the large firms that are competing globally. The Finance Minister foregone revenue estimate of Rs 7,200 crore per annum for this for this measure. Besides, the Finance Minister refrained from removing or reducing Minimum Alternate Tax (MAT), a popular demand from India Inc., but provided a higher period of 15 years for carry forward of future credit claims, instead of the existing 10-year period. “It is not practical to rem
1 comment
Read more

Don't forget to verify your income tax return in August: Here's the process

By
  An ITR return needs to be verified within 120 days of filing of tax return. Now that you have filed your income tax return, remember to verify it because your return filing process is not complete unless you do so. The CBDT has reduced the time limit of ITR verification to 30 days (from 120 days) from the date of return submission. The new rule is applicable for the returns filed online on or after 1st August 2022. E-verification is the most convenient and instant method for verifying your ITR. However, if you prefer not to e-verify, you have the option to verify it by sending a physical copy of the ITR-V. Taxpayers who filed returns by July 31, 2023 but forget to verify their tax returns, will get the following email from the tax department, as per ClearTax. If your ITR is not verified within 30 days of e-filing, it will be considered invalid, and may be liable to pay a Late Fee. Aadhaar OTP | EVC through bank account | EVC through Demat account | Sending duly signed ITR-V through s
Post a Comment
Read more