Due to the pandemic, many small businesses had difficulty staying afloat and had to close down businesses.
The lockdowns which had to be initiated to protect the elite and the ordinary people, at regional and national level, struck at the roots of flow of capital in the economy.
Such was the fallout not only in India but all over the world.
A world-renowned publication had even termed the COVID 19 as “The Inequality Virus”.
The MCA informed in a written reply in the Lok Sabha that a total of 10,113 registered companies had gone out of business. These companies have been expelled from the rolls of registered companies under Section 248(2).
This section mandates the MCA removes any company that fails to start operations within one year of registration or fails to show any operation for the two immediately preceding financial years.
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It is estimated that the primary reason has been the utter drop or complete cessation of any revenue due to the lockdown.
However, a surprising statistic was also revealed. The number of new companies registered with MCA increased, and by 20% compared to the last year.
The MCA clarified that no drive has been initiated to expel the companies.
Further, the steps taken by the government to encourage, facilitate, and enable a higher number of companies to get incorporated were elaborated.