Procedure to file application for Voluntary Striking Off Name of Companies U/S 248(2)

Procedure to File Application For Voluntary Striking Off Name Of Companies U/S 248(2)-  (Fast track Exit Under Companies Act 2013)

The quickest way to close the non-operational company is through a process called Fast Track Exit (FTE). Companies Act 2013 has a separate chapter on this subject i.e Chapter XVIII, containing section 248 to 252. These sections came into effect from 26^th December 2016.

However the E-form for filing application under section 248(2) i.e. E-form STK-2 was made available on 5th April 2017.  This form is “Removal of Companies name form Registrar of Companies” like Fast Track Exit Scheme in previous Companies Act 1956.

This form is filed pursuant to sub section (2) of Section 248 of the Companies Act, 2013, which talk about ‘voluntary removal of name of Companies form Registrar of Companies. Let’s talk in details about procedure of Voluntary Striking Off Name Of Companies U/S 248(2)

Let’s talk in details about procedure of Voluntary Striking Off Name Of Companies U/S 248(2)

WHO CAN FILE APPLICATION?

Application for voluntary removal of names of companies from Register under sub-section (2) of Section 248 can only be filed by the following companies:

a) A company who has failed to commence its business within one year of its incorporation

Or

b) A company which is not 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 under section 455,

COMPANIES NOT ALLOWED TO FILE APPLICATION U/S 248(2)

Following companies cannot file application under section 248(2)

i. if any time in the previous three months, the company has changed its name

ii. if any time in the previous three months, the company has shifted its registered office from one State to another;

iii. If the Company has made a disposal for value of property or rights held by it, immediately before cesser 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;

iv. If it 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;

v. If the Company  has made an application to the Tribunal for the sanctioning of a compromise or arrangement and the matter has not been finally concluded; or

vi. If the Company is being wound up under Chapter XX of this Act or under the Insolvency and Bankruptcy Code, 2016.”.

PROCEDURE TO FILE APPLICATION UNDER SECTION 248(2)

1. Extinguishingall its liabilities, by a special resolution or consent of seventy-five per cent members in terms of paid-up share capital,

2. File an application in E-form STK-2 along with followings attachments:

a. No Objection Certificate from  appropriate Regulatory Authority concerned in respect of following companies, namely :-

i. NBFC

ii. Housing Finance Companies,

iii. Insurance Companies, Companies

iv. companies in the business of capital market intermediaries as referred to in the Securities and Exchange Board of India Act, 1992 (15 of 1992) or  rules and regulations thereunder;

v. companies engaged in collective investment schemes as referred to in the Securities and Exchange Board of India Act, 1992 (15 of 1992)  or  rules and regulations thereunder;

vi. asset management companies as referred to in the Securities and Exchange Board of India Act, 1992 (15 of 1992) or rules and regulations thereunder;

vii. any other company which is regulated under any other law for the time being in force.

b. Indemnity bond duly notarised by every director in Form STK 3;

c. a statement of accounts containing assets and liabilities of the company made up to a day, not more than  thirty days before the date of application and certified by a Chartered Accountant;

d. An affidavit in Form STK 4 by every director of the company;

e. A copy of the special resolution duly certified by each of the directors of the company or consent of seventy five per cent  of the members of the company in terms of paid up share capital as on the date of application;

f. A statement regarding pending litigations, if any, involving the company.

An application filed, will be cross-verified by ROC, by giving a public notice in English and vernacular language newspaper seeking objections from any person concerned. The ROC shall also seek objections if any, from income tax, central excise, service tax authorities. These regulatory authorities  and persons has to raise objections within a period of thirty days from the date of issue  of the letter of intimation / Public notice and if no objections are received within thirty days ROC shall  presumed that they have no objections to the proposed action of striking off or removal of name.

NOTICE OF STRIKING OFF AND DISSOLUTION

The Registrar will issue a notice of striking off the name of the company from the register of companies and its dissolution. This notice will also be be published in the Official Gazette in and the same shall also be placed on the official website of the Ministry of Corporate Affairs.

EFFECT OF COMPANY NOTIFIED AS DISSOLVED

Though the company has been dissolved and its name removed from the Registrar of Companies. However any  liabilities, if any, continues on every director, key officer, members of the company and may be enforced as if the company had not been dissolved.

(KASHIF ALI & ASSOCIATES, Company Secretaries, 268, Business India Complex, Uday Park, New Delhi-110049, Call us :+91 9718483209)