Crackdown on shell companies begins, ED raids 100 locations in 16 states
It was the prime minister's office that had ordered the crackdown on shell companies a few weeks ago. Photograph: (PTI)
The enforcement directorate raided the premises of some 300 shell companies Saturday morning, the Press Trust of India reported.
The raids were conducted at a 100 locations across 16 states.
PTI reported that raids were conducted in the cities of Delhi, Chennai, Kolkata, Chandigarh, Patna, Ranchi, Ahmedabad, Bhubaneswar, and Bengaluru among others.
Officials said the raids were carried out under the provisions of the Prevention of Money Laundering Act (PMLA) and the Foreign Exchange Management Act (FEMA) to check money laundering and illegal foreign exchange transactions.
The ED has recently attached the assets of these firms; the assets are reportedly worth crores.
ED is conducting nationwide searches under FEMA & PMLA in 16 states at over 100 premises in relation to 300 shell companies. pic.twitter.com/tq9ZgCRDBo— ANI (@ANI_news) April 1, 2017
The order to raid the alleged shell firms was issued a few weeks ago from the Prime Ministers Office (PMO).
A shell company is defined as "a non-trading company used as a vehicle for various financial manoeuvres or kept dormant for future use in some other capacity".
(WION with inputs from PTI)