Whenever a Company is incorporated a Certificate of Incorporation is granted by the Registrar of Companies which admits the existence of the Company. Once the name of a company is entered in the registers of the Registrar it cannot be removed from the same until and unless the Company applies for the removal or is initiated by process under law. The Registrar has power to strike off the name of the Company from the registers if it fails to commence its business or fails to submit the yearly returns.
Running a business is difficult as there are a certain set of complications and challenges faced by the businessmen. If the things do not work properly the business may have to shut down properly.
It is a long process for winding up a Company but there are some companies which can apply under fast track exit for striking off its name. A fast track exit scheme is a company closure scheme initiated by the MCA for easy and fast closure of the Company.
Legal Window can help you with the strike off/closure of a company just by following certain steps by providing the best assistance, timely delivery and guaranteeing the highest customer satisfaction You may get in touch with our team on 072407-51000 or email firstname.lastname@example.org .
Companies who can apply under fast track exit mode for striking off the name of the Company:
Documents required for closure of LLP
Process of Strike Off of Company
1. Complete Questionnaire
You are requested to first fill the simple questionnaire provided by our expert team which will enable us to know the case of strike Off of the Name of the Company.
2. Document Processing
At the second step you will be required to produce the documents in accordance with the questionnaire filled based upon which case will be dealt so that we can arrange them as per the requirement and for further processing.
3. Application for Strike Off
After arranging the documents we will begin with the drafting of Board Resolution and Special Resolution along with the other affidavits, indemnity bond and other documents in order to get the executed affidavits, indemnity bond and other signed documents.
4. Preparation and filing of the same with MCA
Preparation of the application online and filing of the same along with the required documents on MCA with ROC for striking off the name of the Company.
5. Publishing the strike off after approval of the MCA
After the approval from the ROC a Notice of the same shall be published by MCA.
More Insights on Closure of Company
Modes of Strike Off
The strike off of the company can be initiated by the Registrar or by the Board of Directors on behalf of the company. Let us discuss both the cases :
Strike off of Company by ROC: The Registrar of Companies can send a notice of striking off if finds a reasonable cause for striking off a company to the Company as well as the Directors of the Company. The notice explains about the reasons of the strike off and asks for representatives to reply within 30 days of notice along with required documents. This process is known as “Compulsory removal of name from registrar of Company”.
Striking off a company on its own: The company can suo-motto file an application for strike off in Form STK-2 with ROC by passing a special resolution in the EOGM and after extinguishing all the assets and liabilities. The strike off can be done if the company has not carried on any operation since the date of incorporation and one year has elapsed or company has not carried out any operation since the last 2 years as on the date of application.
It is compulsory to complete all the ROC Annual filings before initiating for the striking off process, if there had no transactions and bank accounts are not operational then we can apply for strike off without any filings.
Process of Striking off a Company
Companies who cannot file for Strike off of Company
FAQ's on Closure of Company
The said Form has to be filled with the ROC within 30 days from the respective date of the Signing of the Statement of Assets and Liabilities.
It can be made only if the company repays or extinguishes all of its liabilities and also receive a No Objection Certificate (NOC) from the respective creditors of the Company before the filing of the closure application and also conduct the meeting of Directors upon the closure by signing a special resolution i.e. consent from seventy-five percent members.
After the filing of the application with the Ministry of Corporate Affairs (MCA), it takes at least 45-60 days for striking off the Company from the MCA records.
In case the company is struck off because of its default, then it has to apply to the National Company Law Tribunal (NCLT) in order to get the status of the company changed from strike off to active by providing valid reasons for the fault and has to comply with the filings.
It is compulsory to complete all the ROC Annual filings before initiating for the striking off process, but in the case there has been no transactions and bank account are not operational then we can apply for strike off without any filings.
The companies are restricted to apply for striking off in case of change of name of the company or the change of registered office to a different state has been done in the past 3 months of the date of application.
- Companies which are not operating or not carrying on any business since last two year from the date of application or,
- Companies which are not operating or not carrying on any business within one year of incorporation and,
The Registrar of Companies can also remove the company's name from the list of companies if, he has reasonable cause to believe that:
- A Company failed to commence its business within one year of its incorporation; or
- A company is not carrying on any business or operation for two immediately preceding financial years and has not made any application within such period for obtaining the status of a dormant company.
ROC publishes a list of the companies struck off in the Official Gazette. The Company who applied through fast-track exit mode will be considered and closed from the date of the publication of the notice in Official Gazette.
If the directors have not complied with the KYC norms, then they cannot file for the closure of the company. All the directors have to file the DIR-3 KYC forms and then only they can proceed for the filing.
In such case, where the ROC strikes off the company due to non-filing of annual returns for more than 3 years, then the directors will become disqualified. But if the filings are incomplete for less than 3 years then directors will not become disqualified.
A Nidhi Company can be striked off if there are no deposits and loans outstanding in the books of the company and 75% of the shareholders give their consent for the closure and the company has filed all the returns with ROC.