Duping of investors by companies

for Ministry of Company Affairs | Date - 06-12-2005



Rajya Sabha

229 companies were originally identified as Vanishing Companies which came out with IPOs during the periods 1992-98, out of which 71 companies are such which came out with IPOs during the period 1993-95 for raising a sum of Rs.607.65 crores from the public.

A Central Coordination and Monitoring Committee, co-chaired by Secretary, Ministry of Company Affairs and Chairman, SEBI has been set up to look into issues relating to vanishing companies and their promoters and to monitor the progress of action taken against vanishing companies and their promoters. Four Task Forces headed by Regional Directors under the Ministry of Company Affairs have been constituted to make concerted efforts for identifying the companies, which are vanishing and their promoters/Directors.

There is no provision in the Companies Act, 1956 for refunding money collected by companies through public issue unless a winding-up order is passed.

This information was given by Shri Prem Chand Gupta, Minister of Company Affairs in reply to a question raised by Shri Sitaram Yechury and Shri Vijay J. Darda in Rajya Sabha today.

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(Release ID :13889)

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