Demonetization has been one of the biggest action taken by Modi Government against corruption. Since the Demonetization came into action on 8th November last year, there have been constant efforts by a specific section of society to demean it. These people don’t leave any opportunity to criticize PM Modi for his hasty approach and short-sightedness on Economic issue.
Recently government released demonetization figures where it was said that major chunk of currency has been returned to the Banks, this gave another opportunity to Modi Haters to come down heavily and hurl abuses on NDA government. However the truth is very different from what is being portrayed by Media and opposition parties.
Demonetization was implemented not only to get the currency back into the banks and stop notes of 500 and 1000, actually it was only a small portion of the entire exercise. There were many other objectives like decreasing high denomination currency, to increase the Digital transactions, to work towards less cash economy, to increase the taxation bracket etc.
However Critics and Corrupts were not able to digest all this and were abusing and accusing PM Modi right from the day 1. However Modi Government has done a commendable work towards reducing corruption, and one of the biggest source of corruption is Shell Companies which are being used for siphoning black money, and that’s the territory where no earlier governments dared to reach, however Modi Government is little bit different.
The government today said that names of over 2.09 lakh firms have been struck off from register of companies for failing to comply with regulatory requirements and action has been initiated to restrict operations of their bank accounts. Continuing its crackdown on shell companies which are allegedly used as conduits for illicit fund flows and tax evasion, the government said the directors of deregistered firms would not be able to operate the bank accounts till these entities are legally restored.
These 2,09,032 companies have been struck off from the register of companies under Section 248 (5) of the Act. The existing directors and authorized signatories of such struck-off companies will now become ex-directors or ex- authorized signatories.
Section 248 of the Companies Act — which is implemented by the corporate affairs ministry — provides powers to strike off names of companies from the register on various grounds including for being inactive for long.
About the directors and signatories of the over 2.09 lakh firms, the government said they would not be able to operate bank accounts of such companies till these entities are legally restored. The restoration, as and when it happens, would be reflected in the official records by way of change in the status from ‘struck off’ to ‘active’.
Since such ‘struck off’ companies have ceased to exist, action has been initiated to restrict the operation of bank accounts of such companies. The Department of Financial Services, through the Indian Banks Association, has advised banks that they should take immediate steps to put restrictions on bank accounts of such struck-off companies.
In addition to such struck-off companies, banks have also been advised to go in for enhanced diligence while dealing with companies in general.
A company even having an active status on the corporate affairs ministry website but defaulting in filing of its due financial statements or annual returns, among others, “should be seen with suspicion as, prima facie, the company is not complying with its mandatory statutory obligations”.
By taking this stern action, Modi government has once again give a Big blow to its critics and corrupts.