What is Strike Off.
Strike Off simply means the closing of the company at the desire of Shareholders and Management. There is no perfect definition in the Company Law on Strike Off. The provisions of strike off is governed under under sub-section (2) of section 248 along with ‘The Companies (Removal of Name of Companies from the Registrar of Companies) Rules, 2016‘.
“An application for removal of name of the company under sub-section (2) of section 248 shall be made in Form STK-2 along with the fee of Rs.10,000/- (Rupees Ten Thousand).
Provided that no application in Form No. STK-2 shall be filed by a company unless it has filed overdue returns in Form No. AOC-4 (Financial Statement) or AOC-4 XBRL, as the case may be, and Form No. MGT-7 (Annual Return), up to the end of the financial year in which the company ceased to carry its business operations”.
Pre-conditions are given as follows:
i. Extinguishing all its liabilities and
ii. Taking approval from Members by special resolution or consent of 75% members of paid up share capital (Equity + Preference)
iii. Require No Objection Certificate from appropriate regulatory authority whichever the company is governed.
While applying striking off two forms are required:
MGT 14
STK-2
After filing the form, the concerned Registrar of Companies will take around 3-4 months to approve the forms and if there is any defect in the forms, the said ROC will raise an objection and sent it to you via email or you can check by tracking the SRN, by using MCA portal.
Procedure of Strike Off:
| STEPS | PARTICULARS | TIMELINE | FORMS TO BE FILED |
| STEP 1 | Convene a Board Meeting with two Directors or by a majority of Directors.
To pass board resolution for striking off of the company Issue a notice for holding a general meeting of shareholders. |
Notice of BM 7 days before | – |
| STEP 2 | Issue notices in writing calling for the General Meeting of the Company proposing the resolutions, with suitable explanatory statement. | Notice of EGM- 21 days before | – |
| STEP 3 | Holding an Extraordinary General Meeting:
A company needs to pass a special resolution for striking off of the company Filing e-form MGT-14 within 30 days from the date of passing the Special Resolution with ROC. |
Within 30 days from the date of meeting | MGT 14 |
| STEP 4 | Filing of Forms along with required documents
List of attachments of Form MGT 14: 1. Certified true copy of Board Resolution 2. Certified true copy of Special Resolution 3. Notice and explanatory statement of Extra Ordinary General Meeting List of attachments of Form STK 2: 1. Certified true copy of Board Resolution 2. Certified true copy of Special Resolution 3. Indemnity Bond duly notarized by all directors (in Form STK 3). 4. An affidavit in Form STK-4 by every director of the company 5. a statement of accounts in Form STK 8 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; 6. A statement concerning any pending litigations if any applicable to the company. 7. No objection certificate from relevant regulatory department in case company is governed by such department. 8. Self certified ID Proofs of all directors. |
Within 30 days from the date of meeting | STK 2 |
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Disclaimer: –The above mentioned article have been based on relevant provisions and practical difficulties faced while applying the striking off of company. Under no circumstance, the author shall not liable for any direct, indirect, special or incidental damage resulting from, arising out of or in connection with the use of the information.
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Nice article….includes all knowledgeable facts….good going. Keep sharing articles like this.
When we say “Extinguish all liabilities” ,means shareholders should also be paid ,only then all liabilities will be extinguished.
Kindly confirm.
Is Bank closing certificate is also required to attached in the form STK-2.
It is not mentioned in the respective section.