Stay updated with breaking news from Second Amendment Rules. Get real-time updates on events, politics, business, and more. Visit us for reliable news and exclusive interviews.
The Indian corporate affairs ministry reported that over 1.96 lakh companies and Limited Liability Partnerships were incorporated in the country this year, up from 1.88 lakh in the previous year. The ministry emphasized the importance of enhancing compliance and ease of doing business in corporate governance.
"It is a matter of common knowledge that in the case of private companies, it is not rare that the shares of the company are registered in the name of persons who are not traceable, do not have valid PAN or similar identification numbers, or remain unidentified," said Payal Agarwal of Vinod Kothari Consultants. "Historically, dematerialisation of shares is looked upon by the government as a means to curb black money."
The government has asked private companies to dematerialise their securities by September 2024, a move that will help enhance transparency and will have a broad impact. The requirement will be applicable to private companies, excluding small companies and government companies. There are about 1.4
India's Ministry of Corporate Affairs (MCA) has mandated that large unlisted private companies, including unicorns, issue securities only in dematerialized form, giving them until the end of September 2024 to comply with the rule. The move is expected to enhance transparency in the financial market and encourage companies to disclose their share structures more openly.
The Revenue Department has tightened the rules under the anti-money laundering law to make reporting obligations more stringent for entities like banks, stock brokers and insurers, showed an official order.