Shell company identification triggers regulatory strike-off and exchange surveillance measures to curb misuse and illicit financial activity.
Persistent non filing of financial statements prompted identification of entities described as shell companies, leading to large scale strike offs through the Companies Act removal framework. A Special Drive using red flag indicators has been used to detect and remove such companies, while securities regulator referrals prompted exchange surveillance, restrictions on promoter and director share transfers, verification of fundamentals, and investigations by company law investigators.