Govt plans geo-tagging to crackdown on shell companies

Govt plans geo-tagging to crackdown on shell companies

News:

1.Government is planning mandatory Geo-Tagging for companies to prevent fraud.

Important Facts:

2.Geo-tagging will help the government to prevent fraud committed by Shell companies.

3.What are Shell Companies

• A shell company is a non-profit company. It does not have an active business or assets. It is mostly a company on papers which is used in business transactions.
• It is not necessarily illegal but is often used for tax evasion.
• They neither manufacture anything nor render any service. They are generally used to make financial transactions.

4. Due to lack of clear definition of Shell companies, Government is in the process of defining them.
5.Government has asked companies to geo-tag their registered offices in the statutory filings with the Registrar of Companies (RoC).

5. What is Geo-Tagging

• The process of Tagging something (e.g. Infrastructure, Objects etc.) with geographical information like latitude, longitude, distance, place name in form of metadata (may be QR code, RSS feeds SMS message).

6. Application and Advantages of Geo-Tagging

• Geotagging helps to find a wide variety of location-specific information from a device.
• It helps government to track companies with a common address, common contact numbers, common directors and sudden and unexpected changes in revenue, etc.
• Implementation of schemes
• Informing beneficiary about the facility available through various scheme.
• Monitoring of Assets..

7.Geo-Tagging enabled projects of GOI.

• Rajiv Gruhakalpa scheme helped Andhra government to trace irregularities in construction of houses.
• In Rashtriya Krishi Vikas Yojana Geo-Tagging helping Government to understand flow of funds, inventorying the assets, bringing in transparency.
• Geo MGNREGA and monitoring of watershed activities.
• Postal department has also geotagged the post offices using NRSC Bhuvan Platform.
• In 2016 due to denomination, Government was able to crackdown on several companies which was involved into money laundering