Modi govt freezes over 200,000 bank accounts of suspected shell companies

The bank accounts of 209,032 suspected shell companies have been frozen, the government said on Tuesday, while advising banks to be cautious about active ones not filing statutory returns.

The Registrar of Companies (RoCs) of 24 jurisdictions have deregistered these firms and because of that “the existing directors and authorised signatories of these companies will now become ex-directors or ex-authorised signatories,” the statement said.

These individuals will, therefore, not be able to operate the bank accounts of their erstwhile companies till such entities are restored by an order of the National Company Law Tribunal.

The restoration, as and when it happens, will be reflected by a change in the status of the company from “struck off” to “active”.

The Department of Financial Services has, through the Indian Banks’ Association, advised banks that they should take immediate steps to put restrictions on the bank accounts of such companies.

Besides, banks have been advised to go in for enhanced diligence while dealing with even those not struck off by RoCs. Even if a company has active status but has defaulted in filing its financial statements or annual returns relating to the assets on the secured loan, it should be seen with suspicion.