12,930 companies shut down operations in financial year 2020-21

Vijay C Roy

Tribune News Service

Chandigarh, May 12

Amid the Covid pandemic and lockdowns that significantly disrupted economic activities since March last year, as many as 1,107 companies closed their operations voluntarily in the financial year 2020-21 in the northern region. However, in 2019-20 fiscal, 3,380 companies had wound up their operations.

According to data released by the Ministry of Corporate Affairs (MCA), the maximum number of companies that ceased to exist were in Haryana (436), followed by Punjab (315) and Himachal Pradesh (192).

In Chandigarh, 164 companies closed their operations. The companies shut down their businesses voluntarily and not due to any penal action. While some of them have been delisted by the MCA for not filing annual returns and balance sheets, others wound up their operations voluntarily as either they incurred huge losses or were unable to commence operations within the stipulated time amid the pandemic.

A majority of the delisted companies was from the services sector that includes hospitality, tour and travel, immigration, security services and BPO, followed by manufacturing.

The Companies Act provides for deletion of names of firms from the Registrar of Companies if they don’t commence operations within a year of incorporation or those which have not filed their annual return or balance sheet for two consecutive years.

Across the country, nearly 12,930 companies shut down operations in the last fiscal.