Business Standard

Legal experts split hairs on definition of shell companies

Experts say using shell firms does not signify illegality of tax abuse and regulatory provisions

Sebi order on shell firms
Premium

(Photo: iSTOCK)

Sudipto Dey New Delhi
Legal and corporate governance experts are having a tough time fleshing out the ambiguities in the definition of a shell company, following the Securities and Exchange Board of India’s (Sebi’s) decision to restrict trading in 331 of them. Many say it is important to separate genuine shell companies from the rouges. A view that is gathering momentum in the legal fraternity is to give the promoters of suspect shell companies a chance to defend themselves before any action is taken against them.

Experts say using shell companies is a legitimate global practice and does not signify illegality of abuse of
Topics : Sebi

What you get on BS Premium?

  • Unlock 30+ premium stories daily hand-picked by our editors, across devices on browser and app.
  • Pick your 5 favourite companies, get a daily email with all news updates on them.
  • Full access to our intuitive epaper - clip, save, share articles from any device; newspaper archives from 2006.
  • Preferential invites to Business Standard events.
  • Curated newsletters on markets, personal finance, policy & politics, start-ups, technology, and more.
VIEW ALL FAQs

Need More Information - write to us at assist@bsmail.in