Registration of Shell Companies

Investigation against any company is carried out on the basis of report of Registrar of Companies or inspector or in public interest into the Affairs of a company. Further, the process of incorporation of a company has been strengthened through inclusion of various provisions mandating proof of establishment of registered office of a company through submission of utility bills etc., establishing identity of directors including their residential address and personal identification through mandatory Director Identification Number (DIN) allotment process and a declaration by a professional that all requirements mandated under the provisions of Companies Act, 2013 have been complied with.

 Under section 248 of the Companies Act 2013, Registrar of Companies has powers to remove name of a company from register of companies where a company fails to commence its business within one year of its incorporation or the subscribers to the memorandum have failed to pay their subscription within a period of 180 days or where a company is not carrying on any business or operation for a period of two years.

 This was stated by Shri Arun Jaitley, Minister of Corporate Affairs in written reply to a question in the Rajya Sabha today.