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Over a third of 1.7 mn registered firms closed due to illegal activities

The number of active firms stood at little over 11.30 lakh as on October 31

Press Trust of India  |  New Delhi 

Illustration: Ajay Mohanty
Illustration: Ajay Mohanty

More than one-third of the total 1.7 million registered in the country were shuttered as on end of October, latest official data showed.

While authorities step up their clampdown on suspected of being used as a conduit for illegal activities, the number of active firms stood at little over 11.30 lakh as on October 31.

The corporate affairs ministry, which is implementing the Act, has so far struck off the names of around 2.24 lakh entities that have not been carrying out business activities for long.

"The total number of registered in the country as on October 31, 2017, stood at 17,04,319... there were 11,30,784 active as on October 31, 2017," the ministry said in a report for the month of October.

According to the report, out of the total, 5.35 lakh were closed down, 1,123 were assigned dormant status, 5,957 were under liquidation and 31,666 were in the process of being struck-off, among others.

"Out of the 5,34,674 closed companies, about 10,443 were liquidated/ dissolved; 4,92,735 were defunct (and hence struck-off); 19,984 were amalgamated/ merged with other companies; 6,719 were converted to LLP (Limited Liability Partnership) and 4,793 were converted to LLP and dissolved," it noted.

Among the active companies, the maximum were into with the number of such entities touching 3.34 lakh, followed by manufacturing (2.30 lakh), trading (1.50 lakh) and construction (1.03 lakh).

In the report, the ministry said a total of 7,556 were registered this October compared to 6,542 firms in the year-ago period.

"An analysis of registration of new during October 2015 to October 2017 indicates that monthly registration of has increased after hitting its lowest of 3,994 in April 2016," it added.

The registered in October 2017 had a collective authorised capital of Rs 1,394.61 crore.

"Of them 7,524 were registered as limited by shares with authorised capital of Rs 1,394.09 crore; 32 were registered as limited by guarantees with authorised capital of Rs 52 lakh," the report said.

First Published: Sun, November 26 2017. 13:12 IST