Striking off the name of the Company
The closure of an Indian company under Section 248(2) of the Companies Act, 2013,
is a process where a company voluntarily applies for its name to be struck off from
the Register of Companies (RoC). This is typically done when a company is not
carrying on any business or operation. The process also involves the repatriation of
foreign investment, where applicable. Below is an overview of the process:
1. Eligibility Criteria for Closure
The company should not be carrying on any business or operation.
All liabilities must be settled or disposed of before applying for closure.
The company should not have any ongoing legal proceedings.
No inspection, inquiry, or investigation should be pending against the
company.
The company should have filed all its statutory returns up to date.
2. Preparation for Closure
Board Meeting: Convene a board meeting to pass a resolution for voluntarily
striking off the company's name. The resolution should authorize a director to
make the necessary filings with the Registrar of Companies (RoC).
Special Resolution: If the company has shareholders, a special resolution
must be passed in a general meeting, obtaining approval from at least 75%
of the shareholders.
3. Filing of Application (Form STK-2)
Form STK-2: The company must file Form STK-2 with the RoC, which includes:
o A statement of accounts not older than 30 days from the date of
application, certified by a Chartered Accountant.
o An affidavit by the directors, declaring that all the information provided
is correct and the company is not involved in any fraudulent activities.
o An indemnity bond from directors, ensuring that they will cover any
losses that might arise after the company is dissolved.
o A special resolution or consent of 75% of members.
4. The application submitted will be processed by The Centre for Processing
Accelerated Corporate Exit (C-PACE) is a Ministry of Corporate Affairs (MCA)
initiative that aims to streamline the process of closing a company in India. C-PACE
was established in March 2023 to reduce the time it takes to close a company from
over two years to less than six months
5. Publication and Objection Period
Publication: The RoC will publish a public notice (STK-6) in the Official Gazette
and on the MCA website, inviting objections from the public or stakeholders
within 30 days.
Objections: If any objections are raised, they must be resolved before
proceeding.
6. Final Striking Off
If no objections are received, or if any objections are resolved, the RoC will
strike off the company’s name from the Register of Companies and publish
the final notice (STK-7) in the Official Gazette.
Procedure
Sectio Particulars Remarks
n
248 Striking off When the company become inoperative i.e not
(Meaning) carrying any business operations and does not want to
do any business activity in near future then in such
case the strike off is an option where by the Company
can get its name removed from the register of
companies by making an application to the Registrar.
248(1) Who can apply for If a company has failed to commence its business
strike off within one year of its incorporation, or
Is not carrying on any business for a period of 2
immediately preceding Financial Year
-- Procedure Extinguishing all its liabilities
Closure of Bank Account
Surrendering all the registrations, the Company
is holding in its name
Hold BM with an agenda to strike off the name
of the Company
Filing of application to strike off the name of the
Company to the Registrar
Rule 4 Documents to be Board Resolution, providing authority to make
(3) prepared & Signed application for striking off the name and other
related activities
Special Resolution/ Consent of Shareholders
Indemnity Bond (STK-3) duly notarised
Affidavit (STK-4) duly notarised
Statement of Accounts (not more than 30 days
from the date of application)
Statement regarding pending litigation, if any
Rule Filings to be done Application for striking off in Form STK-2 (along with
4(1) fee of Rs 10,000)
Timelines:
1. Drafting documents: 3-4 working days
2. Filing application on receipt of signed documents: 1-2 working days
List of Documents required:
a. Directors KYC Docs
b. Company PAN
c. IT Return if Filed
d. Bank Closure Letter