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Strike off a company

Striking off a Company is an official way of closing it down. Section 248 of
the Companies Act 2013 prescribes specific steps that need to be followed
for removing the name of the Company from the Official Register of ROC. It's
simpler and faster than other methods of dissolving a business.
CompaniesNext team can assist you in getting your Company Struck off with
due care and ensure all compliance in this regard.

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When a Company gets incorporated its name is entered in the official registry
of the ROC and can't be removed unless one applies for it or it is ordered by
law. If the owner of the Company fails to get its business started, or if its
annual returns aren't submitted for two consecutive immediately previous
financial years then one can apply for Striking off the name of the Company.
Striking off is an easy way to shut down its operations. The Registrar of
Companies can initiate the Process on its own, or the company itself can
apply for its name to be struck off from the official Register of the Registrar of
Companies. According to the Companies Act 2013, there are specific steps
and procedures that need to be followed in order to do this. It's a fast way to
dissolve a business, making it simpler and cost-effective.

Basic Conditions for Company to go

for Strike off:
The company can apply to the ROC for removing its name after obtaining the
Consent of at least 75% of its Shareholders and extinguishing all its liabilities
on any of the following grounds:

A. The Company has failed to start its business operations within one
year of its incorporation;
B. The company is inoperative or does not carry out any of its business
operations for two preceding financial years and has not filed an
application within such period for getting the status of a dormant
company under Section 455 of the Act;
C. The subscription money is not received by the Company and a
declaration pertaining to the same has not been filed in form INC – 20A
within 180 days of incorporation;

Restrictions on Voluntary Strike off

The Companies are restricted from submitting strike-off applications if, at
any point over the previous three months, the Company:
 Has changed its name or
has shifted its registered office from one state to another; or
has made a disposal for value of property or rights held by it,
immediately before cessation of trade or otherwise carrying on of
business, for the purpose of disposal for gain in the normal course of
trading or otherwise carrying on of business; or
has engaged in any other activity except the one which is necessary or
expedient for the purpose of making an application under that
section, or deciding whether to do so or concluding the affairs of the
company, or complying with any statutory requirement; or
has made an application to the Tribunal for the sanctioning of a
compromise or arrangement and the matter has not been finally
concluded; or
is being wound up under Chapter XX of this Act or under the
Insolvency and Bankruptcy Code, 2016.

Documents and Details Required

Consent of 75% shareholders and NOC from Creditors (*Draft will be
provided from our team)
A statement of liabilities comprising all assets and liabilities of the
companies (certified by a Chartered Accountant). (*Draft will be
provided from our team)
AOC-4 and MGT-7 for last 2 Financial Years
Income Tax Returns for the last 3 financial years.
Identity and Residential Proof of all the Directors
MOA and AOA of the Company
Details of any pending litigations with respect to the Company, if any.
Bank Account Closure Letter
Details of Shareholders till date.
Authority Letter and Consent to make an Application and Affidavits –
Duly signed by all the Directors and Shareholders (* Draft will be
provided from our team)

Process for filing Strike off

Application
Passing of Board Resolution: The first step is to conduct a Meeting of
Board of Directors of the Company and passing thereat a resolution for
approving the strike off of the Company and authorising any Director
to submit an application for the strike-off process shall be passed.
 Paying off Debts: A business that wants to be struck off must have
taken care of all of its responsibilities and should have made proper
arrangements for paying off its Creditors.
Obtaining Shareholders Consent: A Special resolution for strike off of
the Company shall be approved at a general meeting of shareholders.
It must be noted that 75% of the Company’s shareholders must
approve this resolution. After this, the resolution shall be submitted to
the ROC in e-form MGT-14 within thirty days.
Approval from Govt. Authority: Approval from the appropriate Govt.
Authority shall be obtained, if the Company is registered under any
such Authority
Filing of Strike off Application in e-form STK – 2: An application to
the RoC in e-form STK-2 shall be submitted along with requisite
documents for initiating the strike off of the Company.

Implication of Dissolvement
If a company acknowledges its dissolvement, it must stop operating as a
business as of that date, and the Certificate of Incorporation it received from
the ROC is presumed to have been revoked, with the exception of any
outstanding debts or obligations. In addition, when the Corporation was
dissolved, any outstanding corporate obligations of the directors, officers
who had managed it directly or indirectly, and each member of the Company
would still be enforced.

Frequently Asked Questions

What are ways to get a Company to strike off?

A company can get strike off in the following two ways:-

1. By Registrar of Companies Suo Moto, or

2. By Company itself through Voluntary Strike Off Is it necessary to pay off
all the liabilities before filing the strike-off application?
Ans. A company proceeding for strike-off must have closed off all its
liabilities before filing the application with ROC.

What is the conditions for getting a company is struck off?

The company can be struck off upon fulfilling any of the following
conditions:

1. When a company has failed to commence its business within one year of
its incorporation; or
2. When a company is not actively carrying on any business or operation for
a period of two immediately preceding financial years and has not made
any application within such period for obtaining the status of a Dormant
Company.
3. The subscription money is not received by the Company and a
declaration pertaining to the same has not been filed in form INC – 20A
within 180 days of incorporation
What is the conditions for getting a company is struck off?

The company can be struck off upon fulfilling any of the following
conditions:

1. When a company has failed to commence its business within one year of
its incorporation; or
2. When a company is not actively carrying on any business or operation for
a period of two immediately preceding financial years and has not made
any application within such period for obtaining the status of a Dormant
Company.
3. The subscription money is not received by the Company and a
declaration pertaining to the same has not been filed in form INC – 20A
within 180 days of incorporation
Can a struck-off company continue its business operations?

When a company is struck off, its name is removed from the Register of the
ROC and it can not continue its business operations, sell its assets or make
payments or even it can not get involved in any other profit-making
activities.

Can the name of the Company be available after its Strike-off?

The name of the strike-off company would be made available for new
companies to use.

Which Companies are not eligible for strike-off by ROC?

Listed companies;
Companies that have been delisted due to non-compliance of listing
regulations or listing agreements or any other statutory laws;
vanishing companies;
Companies, where inspection or investigation is ordered and being
carried out or actions on such order, are yet to be taken up or were
completed but prosecutions arising out of such inspection or
investigation are pending in the Court;
Companies where notices under section 234 of the Companies Act,
 1956 (1 of 1956) or section 206 or section 207 of the Act have been
issued by the Registrar or Inspector and reply thereto is pending or
report under section 208 has not yet been submitted or follow up of
instructions on report under section 208 is pending or where any
prosecution arising out of such inquiry or scrutiny, if any, is pending
with the Court;
Companies against which any prosecution for an offence is pending in
any court;
Companies whose application for compounding is pending before the
competent authority for compounding the offences committed by the
company or any of its officers in default;
Companies, which have accepted public deposits which are either
outstanding or the company is in default in repayment of the same;
Companies having charges which are pending for satisfaction; and
Companies registered under section 25 of the Companies Act, 1956 or
section 8 of the Act.

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