Sakshi Batra gets in conversation with Moneycontrol Deputy Executive Editor, Gaurav Choudhury to know why the government has struck down the names of 1.8 million directors.
The Ministry of Corporate Affairs (MCA) has struck down the names of approximately 1.8 million independent directors serving on boards of thousands of companies after they failed to complete know your customer (KYC) details. These companies were asked to ensure details of their directors be submitted by the deferred October 3 deadline.
The directors could be fake, or were created for various purposes including tax evasion. Most of the directors had not furnished basic details with companies such as phone numbers and email addresses. Directors from India were expected to provide passport details, PAN numbers and contact details to the MCA.
The move is part of the government's strategy to clamp down on shell or paper companies that seek to operate outside regulatory boundaries. Many such companies are under the scanner for serving as conduits of undisclosed funds to evade taxes.