New Delhi, Aug. 6 -- New Delhi: More than one in three eligible companies in India failed to file their annual returns or financial statements in FY25, according to government data, prompting legal experts to warn that the country's corporate registry is becoming increasingly cluttered with inactive, dormant and financially stressed companies, undermining the reliability of records relied upon by investors, lenders and regulators.

Data tabled in the Lok Sabha on 20 July shows statutory filing compliance has deteriorated steadily over the past five years, even as the number of registered companies has surged, raising questions over the integrity of the corporate affairs ministry's database and the effectiveness of enforcement.

The number...