Asktrix

Company Strike Off

Company Strike Off refers to the formal process of removing a company's name from the Registrar of Companies (ROC) when it is no longer operational. This process is governed by Section 248 of the Companies Act, 2013. Asktrix provides comprehensive support for all company strike-off requirements, ensuring your company meets all regulatory obligations efficiently and accurately.

Importance of Company Strike Off Clearance

  • Prevents Compliance Burden: Eliminates ongoing filing requirements and compliance obligations
  • Avoids Penalties: Prevents accumulation of late fees and penalties for non-compliance
  • Legal Closure: Provides formal legal closure of the company entity

Types of Companies Eligible for Strike Off

  • Private Limited Companies (Pvt Ltd): Most common type eligible for strike-off
  • One-Person Companies (OPC): Single-person companies can be struck off
  • Limited Liability Partnerships (LLP): LLPs are eligible for strike-off process
  • Section 8 Companies: If no charitable activities are ongoing
  • Public Limited Companies: Public companies can also be struck off

Eligibility Criteria for Company Strike Off

  • Inactivity: Company must be inactive for two or more years or not commenced business
  • No Liabilities: No outstanding liabilities, dues, or pending legal cases
  • Unutilized Bank Account: Bank account closed with zero balance and no transactions in past two years

Company Strike Off Process Under Companies Act, 2013

Our streamlined process ensures quick and hassle-free company strike-off:

1

Board Resolution

The board of directors must pass a resolution to apply for strike-off and authorize a director to file the application.

2

Clearance of Liabilities

Ensure all outstanding liabilities, dues, and legal cases are cleared before applying for strike-off.

3

Application Filing (Form STK-2)

File Form STK-2 with the Registrar of Companies (ROC) along with all required documents and fees.

4

Publishing Notice

ROC publishes notice in Official Gazette and ROC website for public awareness and objection period.

5

Approval and Strike Off

After 30 days from notice publication, if no objections are received, ROC issues strike-off certificate.

Legal Requirements and Acts Governing Strike Off

  • Section 248-252: Companies Act, 2013 - Main provisions governing strike-off
  • Rule 4(1): Companies (Removal of Name of Companies from the Register of Companies) Rules, 2016

Documents Required for Company Strike Off

  • Board Resolution Copy: Resolution passed by the board for strike-off application
  • Indemnity Bond: Bond indemnifying ROC against any future claims
  • Affidavit by Directors: Sworn statement by directors about company status
  • Statement of Accounts: Final audited accounts showing no liabilities
  • Company's PAN Card: Permanent Account Number of the company
  • Certificate of Incorporation: Original certificate of incorporation
  • Special Resolution: Resolution passed by shareholders or consent from creditors

Timeline for Strike Off Process

  • Application to Approval: 3-6 months from application submission
  • Objection Period: 30 days from notice publication
  • Final Strike Off Certificate: Issued after 30 days if no objections

Cost of Strike Off

The application fee for Form STK-2 is ₹10,000, plus additional costs for professional assistance. Professional assistance typically costs ₹15,000, making the total cost around ₹25,000.

Consequences of Strike Off

  • End of Legal Entity: Company ceases to exist as a legal entity
  • No Rights to Assets: Company loses all rights to its assets
  • Protection from Liabilities: Directors are protected from future liabilities

Revocation of Strike Off

Strike-off can be revoked under Section 252 of the Companies Act, 2013, if the company was struck off without proper notice or if there are valid reasons for restoration.

FAQ

Frequently Asked Questions

Find answers to common questions about company strike-off, eligibility, process, documents, costs, and timelines.

Can an active company apply for a strike-off?

No, only inactive or non-operational companies can apply for strike-off. The company must be inactive for at least two years or not have commenced business.

What happens if there are pending liabilities?

Companies with pending liabilities cannot apply for strike-off. All outstanding dues, taxes, and legal cases must be cleared before applying.

Can a struck-off company be reactivated?

Yes, a struck-off company can be restored under Section 252 of the Companies Act, 2013, if there are valid reasons and proper procedures are followed.

How long does the strike-off process take?

The entire process typically takes 3-6 months from application submission to final strike-off certificate issuance.

What if someone objects to the strike-off?

If objections are received during the 30-day objection period, ROC will investigate and may reject the strike-off application.

Is there a penalty for applying late for strike-off?

While there's no specific penalty for late strike-off application, continued non-compliance may attract penalties and additional fees.

What is the cost for strike-off application?

The government fee for Form STK-2 is ₹10,000. With professional assistance, the total cost is typically around ₹25,000.

Do LLPs have a separate strike-off process?

Yes, LLPs have a separate strike-off process governed by LLP Act, 2008, but the general principles are similar to company strike-off.

What documents are needed from directors for a strike-off?

Directors need to provide affidavits, indemnity bonds, board resolutions, and consent forms as part of the strike-off application.

Can a strike off be done if the company has assets?

Companies with significant assets should consider liquidation instead of strike-off. Strike-off is typically for companies with minimal or no assets.

Company strike-off is a straightforward process when handled by experienced professionals. Asktrix assists clients with end-to-end services, ensuring all requirements are met efficiently and accurately.

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