The Special Investigation Team on black money has submitted its third report which has recommendations with respect to Shell Companies & Beneficial Ownership.
SIT has called for greater vigilance by law enforcement agencies like CBDT, CBEC and Enforcement Directorate in examining the operations of such Companies.
SIT has requested Ministry of Company affairs to take necessary action with respect to violation of the Companies Act where people have directorship in more than 20 companies.
Likewise it has also been noted that there are several addresses from where more than 20 companies are operating.
Finance Ministry in its reaction said that there is no bar on using a single address for companies, SIT desires greater vigilance in the operations of such Companies.
Companies use shell companies to divert profits thereby save on paying taxes to the exchequer.
The SIT with former SC judges Justice MB Shah as its chairman and Justice Arijit Pasayat as its vice chairman was set up under the Supreme court’s July 4, 2011 order.
It comprises the revenue secretary, the Reserve Bank of India’s deputy governor, the directors of the Intelligence Bureau, the Enforcement Directorate, the Central Bureau of Investigation, the chairman, of the Central Board of Direct Taxes, the directors general of the Narcotics Control Bureau, and Revenue Intelligence, the director, Financial Intelligence Unit, and joint secretary, (FT & TR-I), CBDT.
The court had said that the SIT would also include the director of spy agency Research and Analysis Wing.
The case originates in a writ petition filed by Jethmalani in 2009. The apex court, in 2011, had set up the SIT to investigate black money stashed outside the country.
