Probe into 80000 shell firms hits dead end as govt fails to trace PANs


New Delhi, Jun 20: The probe into 80,000 shell companies struck off by the Registrar of Companies (RoC) in the first lot has hit a dead end. The government had not been able to trace the Permanent Account Numbers (PANs) of 80,000 companies, which was hampering investigations, officials of the corporate affairs ministry said.
“Banks were asked to furnish the transaction data of these shell companies. But they did not respond despite multiple reminders. Banks have told us that without PAN card details, it was not possible to track these companies,” one of the officials said.
PAN is compulsory for any transaction above Rs 50,000. So far, the government has transaction details of only 73,000 companies. These companies deposited Rs 240 billion at the time of demonetisation.
Many of these firms were found evading taxes. In a recent communication to the corporate affairs ministry, the income-tax department had asked the RoC to re-activate companies with tax liabilities and pending cases. The tax department had asked the ministry to inform the department before striking them off.
The Central Board of Direct Taxes has told principal chief commissioners of income tax that action against dormant companies with tax liabilities has been limited. The department has ordered officers to file cases against these dormant companies in various National Company Law Tribunals before the end of this month.
During a meeting of the task force on shell companies on November 30, the director-general of corporate affairs (DGCoA) suggested that the income-tax department approach the RoC for taking up the matter of revival of these companies. It was also suggested that protection of interest on revenue would be strong grounds in favour of such a restoration.
The government had sent notices to 226,000 companies for not filing statutory returns. After investigation, it unearthed 16,537 shell companies and suspects another 80,670. On the basis of common directors, it drew up a list of another 16,739.
The government has issued notices to a further 225,000 shell companies based on non-filing of returns. The number is likely to rise, according to ministry officials. It was quite possible that out of the 1.1 million companies registered with the RoC, only around 500,000 would be fully operative, one official said.