Procedure for strike off the name of the company suo motu by Registrar

CS CHARU VINAYAK 
on 22 July 2019


As per the provisions of section 248 (1) of companies Act, the Registrar can suo Motu remove the name of the company from the Register if

  • A company has failed to commence its business within one year of its incorporation or;
  • A company 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 of the Companies Act, 2013.

Before removal of the name of the company from the Register, the registrar is required to send a notice in Form STK 1 to the company and all the directors of the company, of his intention to remove the name of the company from the register of companies. Such a notice should contain the reasons on which the name of the company is to be removed from the register of companies. Such a notice should be sent to all the directors of the company at the addresses available on record, by registered post with acknowledgement due or by speed post. On receipt of such a notice the company and all the directors of the company are required to send their representations along with copies of the relevant documents, if any, explaining the reasons as to why the name of the company should not be removed from the register of companies. Such representations should be given within a period of thirty days from the date of the notice.

Procedure to be followed by ROC for striking of the name of the Company on suo motu basis:

  • Service of notice: The registrar is required to send a notice in Form STK 1 to the company and all the directors of the company about his intention to remove the name of the company from the register of companies. Such a notice should contain the reasons on which the name of the company is to be removed from the register of companies. Such a notice should be sent to all the directors of the company at the addresses available on record, by registered post with acknowledgement due or by speed post.
  • Reply to Notice: On receipt of such a notice the company and all the directors of the company are required to send their representations along with copies of the relevant documents, , explaining the reasons as to why the name of the company should not be removed from the register of companies. Such a representation should be given within a period of thirty days from the date of the notice.
  • Consideration of the representation made: The ROC will consider the representation made by the company and all the directors of the company. If the ROC is not satisfied with the representation made by the company and its directors, it may proceed to strike off the name of company.
  • Publication of Notice: The notice for removal of the name of the company should be in form STK 5 for the information of the general public Such a publication is required to be given for the information of the general public in order to enable the general public to give their objections to the proposed removal / striking off of name of the companies from the register of companies.
  • Intimation to regulatory authorities: The ROC must intimate the proposed action of removal or striking off the names of company to the Income-tax authorities, central excise authorities and service-tax authorities having jurisdiction over such a company. Such intimation should be given to enable the authorities to give their objections. Such objections are required to be given within a period of thirty days from the date of issue of the letter of intimation.
  • Striking off / Removal of the name of the company: After expiry of thirty days from the date of publication of the notice in the newspaper, official gazette and intimation to regulatory authorities and unless cause to the contrary is shown by the company, if there are no objections received within thirty days from the general public or respective authority, the ROC can proceed to strike off or remove the name of the company from the Register of companies.
  • Realisation of amount due: The ROC before passing an order for Striking off / Removal of the name of the company should satisfy that sufficient provision has been made for the realisation of all amounts due to the company and for the payment or discharge of its liabilities and obligations by the company within a reasonable time. Registrar can obtain necessary undertakings from the director or other persons in charge of the management of the company.
  • Notice of dissolution of the company: After the expiry of the time, the ROC can strike off the name of the company from the Register. The notice of striking off the name of the company from the register of companies and its dissolution should be published in the Official Gazette in Form STK 7 and the same should also be placed on the official website of the Ministry of Corporate Affairs(MCA). The company shall stand dissolved on the publication of this notice in the Official Gazette.

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