Indore: Finance Minister Jayant Malaiya, BJP national general secretary and MLA Kailash Vijayvargiya, two IAS officers– Deepali Rastogi and Vinod Semwal and two others have been disqualified for five years from the post of directors of the MP State Textile Corporation (MPSTC). The decision has been taken by Registrar of Companies, Union Ministry of Corporate Affairs. All these directors had failed to file annual return and balance sheet of the company for the last three years. They have been disqualified from November 1, 2016 to October 31, 2021.

Usually such action is taken against private companies. However, this is a unique case where directors of a state government unit were disqualified under Section 164 (2) (A) of the Companies Act 2013. In a fresh crackdown, the ministry has disqualified 1,06,578 directors of various companies across the country for their association with shell firms. This comes just a few days after bank accounts of around 2
lakh shell companies were frozen. Out of over one lakh directors, 9628 belong to MP’s Registrar of Companies located in Gwalior.

Out of these 9,628, six directors are from MPSTC. The remaining directors of the Corporation, who have been disqualified, are Daulat Valre and Madan Solanki. Malaiya is associated with the unit since 2007, while Vijayvargiya from 2009. Rastogi and Semwal are associated with it from 2009 and 2010, respectively. Since, MPSTC is a government unit, it may not have indulged in business of shell companies, but exhibiting a typical government style of working it did not file the annual report and balance sheet of FY 2013-14, 2014-15 and 2015-16 to ROC, Gwalior.

Sec 164 pertains to disqualification for appointed directors and sub-section 2 lists various criteria for them. Among others, a person who is or has been a director of a company that has not filed financial statements or annual returns for three financial years continuously would not be eligible for appointment as a director of a firm.

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