Easy exit in emerging Kerala

KOCHI: At a time when the UDF Government is planning yet another global investment meet — Emerging Kerala — in April 2012 , the prevailing industrial climate in the state is quite depressing. As many as 2,000 companies, including nine Public Sector Undertakings, have closed down in the last fiscal, sending out a not-so encouraging message to the outside world.  And going forward, 2011-12 does not seem to be shaping any different. In August 2011, 30 companies downed their shutters  as per the records of the Registrar of Companies, Kerala and Lakshadweep.  The companies were closed under the Easy Exit Scheme and Fast Track Exit Mode launched by the Ministry of Corporate Affairs, which gave an opportunity for defunct companies to wind up operations and  get their name struck off from the records.“The managements of about 2,000 companies opted to close down in 2010-11 by filing application under the Easy Exit Scheme,” said  Registrar of Companies K G Joseph Jackson.“As many as 30 companies have opted to wind up their operations in just one month — August — making use of the  Fast Track Exit Mode, which was launched in July this year,” he said.      Under the Exit schemes, a company that has no liabilities can apply for closure by paying a nominal fee. “Of the nine PSUs, the process is on for the the closure of Kerala Garments,”   Jackson said. He said there could be many reasons such as loss, labour unrest and liabilities.  As per records, currently there are about 2630 defunct companies in Kerala. A company becomes defunct in the records of ROC once it fails to submit annual  documents such as balance sheet and turnover for three consecutive years. CITU state secretary K O Habeeb said his union would take up the issue seriously. “It is an alarming trend that managements opt for winding up their operations. It is the employees who bear the brunt,” he said.