Did You Receive Strike Off Notice For Your Company?

The Registrar of Companies, Delhi and Haryana (“ROC”) in its drive to clean the registry have initiated the action (II stage) against the non working companies for striking off of all such Companies under Section 248(1) of the Companies Act, 2013. Such notice is received by 31,250 Companies of Delhi under Section 248 (1) of the Companies Act, 2013. Earlier last year as well, such notices were sent to the Companies. Now let’s discuss as to why such notice has been received by the Companies and what the remedies available are.

SECTION 248(1) OF THE COMPANIES ACT, 2013

In accordance with this Section, ROC has the power to send notice of his intention to strike off the Company in the following two cases:

1. When a Company has failed to commence its business within one year of its incorporation.

2. When a Company has not been carrying on operation for a period of two years and has not made application within such period for obtaining the status of a dormant Company.

When the notice is received as aforesaid then representation along with the requisite documents has to be filed within 30 days with the ROC and in case found satisfactory, ROC shall not strike off the Company.

WHY DID YOU RECEIVE SUCH NOTICE?

As aforementioned, ROC has power to strike off the Company in case he has reason to believe that the Company has not been carrying on any operation for a period of two years and the ROC forms such opinion in case the Company has not filed its financial statements and annual returns.

Financial statements i.e. Balance Sheet and Profit & loss is required to be filed with the ROC within thirty days of the Annual General Meeting (“AGM”) in e-Form AOC-4. Whereas, Annual return is required to be filed within sixty days of the AGM in e-Form MGT-7.

Further, please note that every Company is required to hold AGM within six months after the expiry of the financial year. Therefore, we can say that a Company can hold its AGM latest by 30th September as the financial year expires on 31^st March.

REMEDY AVAILABLE

The remedy available to Companies which received such notices can be further discussed in two parts:

1. Intention to continue with the Company

In this situation, the Directors should file all the pending Form AOC-4 and MGT-7 along with the representation letter to the Registrar within one month from the date of issue of such notice. The Registrar may on due satisfaction not strike off the name of the Company.

2. Doesn’t intend to continue with the Company

In this situation, the partners should file all the pending Form AOC-4 and Form MGT-7 along with representation letter and the requisite strike off forms with the Registrar along with the fees and penalty within one month from the date of issues of such notice. The Registrar may on due satisfaction strike off the name of the Company from its Register.

{The author is a Company Secretary in Practice and can be reached at (M) 9999952595 and (E) cskajalgoyal@gmail.com}