Process For Striking Off Name of Company Under Companies Act, 2013

Summary: Section 248 of Companies Act, 2013 and the Companies (Removal of Name of Companies from the Register of Companies) Rules, 2016, outlines the process for removing a company’s name from the register. This can be initiated by the Registrar of Companies (ROC) or by the company itself. The ROC may act if a company has not started business within a year of incorporation, has not conducted business for two consecutive financial years without seeking dormant status, or if subscribers have not paid their subscription money. The ROC will issue a notice to the company and its directors, providing a 30-day window to respond. A company can also apply to be struck off by filing Form STK-2 with a fee of ten thousand rupees. This process involves the company passing a special resolution or obtaining consent from 75% of its members. The company must also close its bank accounts, prepare a statement of accounts, and have all directors submit indemnity bonds and affidavits. The ROC will then publish a public notice to invite objections, and if none are received, a final notice for striking off will be published.

The ROC may strike off the name of the company:-

• If company has failed to commence its business within 1 year of its incorporation;
• The Company is not carrying any business from 2 immediately preceding financial year and has not filed made any application for obtaining the status of dormant company;
• Subscribers to the memorandum has not paid the subscription money and the declaration has not been filled under section 10A i.e, form INC-20A;
• The company is not carrying on any business or operations, as revealed after the physical verification carried out under sub-section (9) of section 12.

ROC may send notice to the company and all directors of the company regarding his intention to remove the name of the company from its records and requesting them to send their representation within 30 days of receipt of such notice.

Sec 248(2) deals with when company files application in form STK-2 with ten thousand rupee fee to ROC for striking off the name of company. The process are as under:-

• Pass BR for striking off the name of the company and to convene EGM of the company for Shareholders approval;
• Hold GM and pass SR or if the company not intends to hold GM, then consent of 75% members in terms of Paid up share capital can be obtained;
• File e-form MGT-14, if company has passed SR in GM;
• Closure of Bank account of the company and closure letter should be obtained and attached in e-form STK-2;
• Statement of account in form STK-8 containing asset and liabilities made up to a day, not more than thirty days before the date of application and certified by chartered accountant;
• Indemnity bond by every director in form STK-3 and it should be duly notarized;
• Affidavits by every director in form STK-4 along with KYC of director;
• Statement regarding the pending litigations of the company , signed by every director of the company;
• File e-form STK-2 with all the attachments mentioned in point no. 1 to 8;
• ROC publish a public notice in form STK-6 inviting objection from the striking off within the prescribed time as published in notice.
• If ROC not received any objection within the prescribed time mentioned in STK-6, then ROC publish notice for striking off in STK-7;