Photo: Pradeep Gaur/MintNew Delhi: Indian regulatory agencies have tracked down about Rs17,000 crore of suspicious transactions, indicating possible tax fraud, by shell companies after analysing data thrown up following last November’s demonetisation exercise, said the Union corporate affairs ministry. The investigation revealed that Rs17,000 crore was deposited into these bank accounts and withdrawn after demonetisation was announced on 8 November. Although the shell companies are struck off from the registry, liability for any offence committed will still rest with the officers responsible for statutory compliance and with promoters. Shell companies are also used for fictitious transactions aimed at inflating expenses by larger companies as well as by promoters of companies with large public interest to divert funds to privately held entities. The corporate affairs ministry has also asked the finance ministry to categorize these as offences under the Prevention of Money Laundering Act.

Source: Mint November 05, 2017 14:48 UTC