15,000 Companies in India Take Easy Exit Scheme

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Set. 7 – An estimated 15,000 companies have opted to take the “easy exit scheme” proposed by the Ministry of Company Affairs (MCA), which cuts down on regulatory processes and costs.

Of the companies applying, 1,815 are companies in finance and investment. The scheme allows companies to take out their names from the Register of Companies for free from May 30, 2010 to August 31, 2010.

The easy exit scheme will not include listed companies, section 25 companies, vanishing companies, companies under investigation, companies against which prosecution for a non-compoundable offense is pending in court, companies having outstanding public deposits or secured loan or dues towards banks and financial institutions or government agencies.

This is the first time in a decade that an easy exit scheme option was available for companies closing down. Applicants of the scheme are required to submit an affidavit, indemnity bond and a statement of account duly certified by the statutory auditor or a chartered accountant.

For more advice on Indian taxes, e-mail Dezan Shira & Associates at india@dezshira.com.