Income Tax

Verification of cash deposits/withdrawals by struck-off companies-CBDT Instruction

Verification of cash deposits/withdrawals from bank accounts of struck-off companies particularly during demonetisation-CBDT Instruction

Lately, the Registrar of Companies (RoCs), all over the country,  took action against a number of  companies  under  section  248(5)  of  the  Companies Act, 2013  by removing their  names from the Register of Companies.

The CBDT, in order to check possible misuse of such companies for money-laundering activities, has asked all the Pr. Chief-Commissioners of Income for getting the verification of suspicious transactions in case of struck-off companies done.

The CBDT has sought verification of the deposits/withdrawals from the bank accounts of such companies during the process of striking down and just before that especially during the period of demonetisation.

It has been advised that the information regarding the struck-off companies may be taken from the website of the Ministry of Corporate Affairs. 

It has been further advised that for the ease of the work, the details regarding bank-account(s) of a particular company may be compiled on the basis of information contained in the Income-tax returns. Thereafter, verification from bank(s) may be made under provisions of section 133(6) of the Income-tax Act, 1961.

The CBDT has advised that in cases where unusual transactions and beneficiaries thereof are deteced, appropriate action may be taken as per provisions of the Income-tax Act after seeking restoration of the struck off company by filing an appeal before the National Company  Law Tribunal (NCLT).

The Board has stressed a time bound exercise for the verification of already struck off companies and positive results to be intimated to the Board.

It has been also stated that in future, the process of verification may continue to be used to monitor indulgence of companies in money-laundering activities which are proposed to be struck -off by the RoC.

The CBDT has instructed that on detection of suspicious  transactions in a particular company, it may be bring to the notice of the concerned RoC within one month during which objections can be filed against the proposal to strike-off a company.

Download CBDT Instruction Click Here >>

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