Income Tax Department steps-up actions under Prohibition of Benami Property Transactions Act : Benami properties of more than Rs. 3,500 crore in more than 900 cases attached

Due to intensive efforts undertaken by the Income Tax Department, provisional attachment has been made in more than 900 cases of properties under the Prohibition of Benami Property Transactions Act (the ‘Benami Act’), which came into force w.e.f 1st November, 2016. These attachments include plots of land, flats, shops, jewellery, vehicles, deposits in bank accounts, fixed deposits etc. The value of properties under attachment is more than Rs. 3,500 crore including immovable properties of more than Rs. 2,900 crore.

In five cases, the provisional attachments of Benami properties, amounting to more than Rs. 150 crore have been confirmed by the Adjudicating Authority. In one such case, it was established that a Real Estate Company had acquired about 50 acres of land, valued at more than Rs.110 crore, using the names of certain persons of no means as benamidars. This was corroborated from the sellers of the land as well as the brokers involved. In another case, post demonetization, two assessees were found depositing demonetized currency into multiple bank accounts in the names of their employees, associates etc. to be ultimately remitted to their bank accounts. The total amount attempted to be remitted to the beneficial owners was about Rs. 39 crore. In yet another case, a cash amount of Rs. 1.11 crore was intercepted from a vehicle with a person who denied the ownership of this cash. Subsequently, no one claimed ownership of this cash and it was held to be benami property by the Adjudicating Authority.

Earlier, the Income Tax Department had stepped-up actions under the Prohibition of Benami Property Transactions Act (the ‘Benami Act’. The Act provides for provisional attachment and subsequent confiscation of benami properties, whether movable or immovable. It also allows for prosecution of the beneficial owner, the benamidar and the abettor to benami transactions, which may result in rigorous imprisonment up to 7 years and fine upto 25% of fair market value of the property.

The Department had set-up 24 dedicated Benami Prohibition Units (BPUs) under its Investigation Directorates all over India in May, 2017 to ensure swift action in respect of Benami properties.

The Department is committed to continue its concerted drive against black money and action against Benami transactions will continue to be intensified.

Registrar of Companies removed names of 2,26,166 defunct companies in 2017

The Government has initiated campaign against black money, wilful defaulters and erring directors. There are a number of registered companies that are facing action from authorities after the demonetisation.

Prior to demonetisation, 16,08,637 number of companies stood registered. After demonetisation, the Registrars of Companies (RoCs) has identified 2.97 lakh companies during 2017-18 which were not filing their Financial Statements or Annual Returns for a continuous period of two or more financial years and, prima facie, were not conducting any business or in operation. Out of such identified companies, ROCs has removed the names of 2,26,166 companies as on 19.12.2017 from the register of companies by following the due procedure under Section 248 of the Companies Act, 2013. Further, based on information received from various banks, the Central Government has ordered investigations into the true ownership of 68 such companies u/s 216 read with Section 210(1)(c) of the Companies Act, 2013, which have deposited Rs. 25 crores or more in Bank Accounts and withdrew in an exceptional manner post demonetisation. The investigations are underway.

As of now, the Government has identified 3,09,619 directors as disqualified u/s 164(2)(a) of the Companies Act, 2013 pertaining to companies for which Financial Statements or Annual Returns have not been filed for a continuous period of three Financial Years.

CSR expenditure of companies for FY 2015-16 is RS 13,625.25 crores

The total expenditure on Corporate Social Responsibility (CSR) for the year 2015-16, as per filings made by companies in the MCA21 registry till 31.03.2017 is Rs. 13,625.25 crores. Of this amount, Rs. 4,091 crores has been reported as spent in local areas. The latter figure does not include expenditure which has been reported in an aggregated manner on an ‘all India’ basis. The statutory audit of a Company under Chapter X of the Companies Act, 2013 covers the audit of the expenditure incurred by the Companies on CSR activities.

In FY 2016-17, 29,403 companies registered as LLP on all India basis

The Limited Liability Partnership Rules, 2009 have been in force since 01.04.2009. The Limited Liability Partnership Rules provide for effectuating/implementing the provisions of Limited Liability Partnership Act, 2008. The Rules, inter-alia include procedures on incorporation of an LLP, its governance framework, relations interse partners, role, functions and liabilities of designated partners, penalties for false statements, investigation of affairs of LLP, regulations for internal working/maintenance of books of accounts/audit thereof as well as for filing forms with Registrar of Companies for notifying the financial position and solvency of Limited Liability Partnership (LLP) and for conversion from firms/companies to LLPs.

The State/UT-wise number of companies converted into LLPs and the LLPs registered during last three years is given below:

State/UT-wise number of Companies converted into LLP and LLPs  registered during last three years
S.No	State/UT	2014-15			2015-16			2016-17
		Converted to LLP	Registered as LLP	Total	Converted to LLP	Registered as LLP	Total	Converted to LLP	Registered as LLP	Total
1	Andaman & Nicobar	0	1	1	0	1	1	0	1	1
2	Andhra Pradesh	4	151	155	2	231	233	2	295	297
3	Arunachal Pradesh	0	1	1	0	2	2	0	3	3
4	Assam	0	28	28	1	64	65	1	125	126
5	Bihar	0	96	96	1	158	159	3	251	254
6	Chandigarh	1	69	70	0	106	106	2	139	141
7	Chattisgarh	0	47	47	1	65	66	0	91	91
8	Daman and Diu	0	2	2	0	6	6	0	5	5
9	Delhi	18	1819	1837	40	3506	3546	53	4074	4127
10	Dadra & Nagar Haveli	0	5	5	1	13	14	1	6	7
11	Goa	0	37	37	0	75	75	3	113	116
12	Gujarat	15	959	974	17	1706	1723	29	2414	2443
13	Himachal Pradesh	1	12	13	3	21	24	4	48	52
14	Haryana	3	342	345	7	620	627	11	874	885
15	Jharkhand	1	46	47	2	107	109	6	149	155
16	Jammu & Kashmir	0	18	18	0	17	17	0	17	17
17	Karnataka	13	1217	1230	15	1740	1755	16	2177	2193
18	Kerala	0	403	403	3	630	633	4	761	765
19	Maharashtra	65	5256	5321	103	7446	7549	92	9769	9861
20	Meghalaya	0	2	2	0	7	7	0	6	6
21	Manipur	0	3	3	0	8	8	0	8	8
22	Madhya Pradesh	5	199	204	3	411	414	3	522	525
23	Mizoram	0	0	0	0	1	1	0	0	0
24	Nagaland	0	0	0	0	1	1	0	1	1
25	Orissa	0	45	45	0	98	98	1	111	112
26	Punjab	0	105	105	3	200	203	5	287	292
27	Pondicherry	0	5	5	0	12	12	0	15	15
28	Rajasthan	4	719	723	2	957	959	9	997	1006
29	Sikkim	0	2	2	0	2	2	0	4	4
30	Telangana	9	349	358	13	767	780	21	1172	1193
31	Tamil Nadu	11	651	662	11	833	844	13	1103	1116
32	Tripura	0	2	2	0	0	0	0	3	3
33	Uttar Pradesh	5	700	705	14	1041	1055	21	1411	1432
34	Uttarakhand	0	44	44	1	61	62	4	135	139
35	West Bengal	12	1347	1359	17	1761	1778	16	2316	2332
Grand Total		167	14682	14849	260	22674	22934	320	29403	29723