The Corporates are the entities registered under the Companies Act, 2013. There are so many times that Company has been incorporated but due to lack of funds and other resources, they could not start their business. Therefore they usually close down the Company.
Ministry of Corporate affairs has issued notification on 26th December, 2016 for the purpose of striking off the names of the Companies from registrar.
Section 248 of the Companies Act, 2013 read with Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 deals with the striking of the names of the Companies from concerned registrar
Conditions for striking of the name of the Company
1. The company has failed to commence its business within one year of its incorporation
2. The 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.
3. Extinguishes all its liabilities
4. The Company has received no objection certificate from appropriate Regulatory Authority concerned, if they are registered.
Procedure to be followed to be followed to removal of the name of the Company
- Call Board meeting
- Pass the Board resolution with the consent of all the Directors
- Call General meeting of the members
- Pass Special Resolution or with 75% consent of members in terms of paid up capital of the Company.
- File Form STK-2 to concerned ROC for removal of the name of the Company from Registrar of Companies.
Restrictions on making application for removal of name of the Company
An application shall not be made if, at any time in the previous three months, the company
1. has changed its name or shifted its registered office from one State to another;
2. 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;
3. 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;
4. has made an application to the Tribunal for the sanctioning of a compromise or arrangement and the matter has not been finally concluded; or
5. is being wound up under Chapter XX, whether voluntarily or by the Tribunal.
Following Companies can not be removed from the Registrar of the Companies
- Listed companies;
- Companies that have been delisted due to non-compliance of listing regulations or any other statutory laws;
- Vanishing companies;
- Companies where inspection or investigation is ordered and being carried out or actions on such order are yet to be taken up or were completed but prosecutions arising out of such inspection or investigation are pending in the Court;
- Companies where notices under section 234 of the Companies Act, 1956 or section 206 or section 207 of the Act have been issued by the Registrar or Inspector and reply thereto is pending or report under section 208 has not yet been submitted or follow up of instructions on report under section 208 is pending or where any prosecution arising out of such inquiry or scrutiny, if any, is pending with the Court;
- Companies against which any prosecution for an offence is pending in any court;
- Companies whose application for compounding is pending before the competent authority for compounding the offences committed by the company or any of its officers in default;
- Companies which have accepted public deposits which are either outstanding or the company is in default in repayment of the same;
- Companies having charges which are pending for satisfaction; and
- Companies registered under section 25 of the Companies Act, 1956 or section 8 of the Act.
Attachments required for filing form STK-2 to concerned ROC
The application in Form STK 2 shall be accompanied along with the fee of five thousand rupees an attachments given below:
1. indemnity bond duly notarized by every director in Form STK 3;
2. 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;
3. an affidavit in Form STK 4 by every director of the company;
4. a copy of the special resolution duly certified by each of the directors of the company or consent of seventy five percent of the members of the company in terms of paid up share capital as on the date of application;
5. a statement regarding pending litigations, if any, involving the company.
6. it should be certified by Chartered Accountant in whole time practice or Company Secretary in whole time Practice or Cost Accountant in whole time practice
Manner of publication of notice –
The notice in Form STK 5 or STK 6, as the case may be will be-
1. placed on the official website of the Ministry of Corporate Affairs on a separate link established on such website in this regard;
2. published in the Official Gazette;
3. published in English language in a leading English newspaper and at least once in vernacular language in a leading vernacular language newspaper, both having wide circulation in the State in which the registered office of the company is situated.
Points to be noted:
- The Company should post this notice on the website of the Company, if any
- The Company need to clear all his debts and liabilities before application
- if the applicant is a foreign national or non-resident Indian, the indemnity bond, and declaration mentioned above shall be notarized or apostilled or consularised.
- Concerned ROC will intimate concerned regulatory authorities regulating the company, viz, the Income-tax authorities etc. having jurisdiction over the company, about the proposed action of removal or striking off the names of such companies and seek objections, if any, to be furnished within a period of thirty days from the date of issue of the letter of intimation and if no objections are received within thirty days from the respective authority, it shall be resumed that they have no objections to the proposed action of striking off or removal of name.
After satisfaction of all the ROC that the Company had made all the compliances and fulfilled the conditions, The Registrar shall cause a notice of striking off the name of the company from the register of companies and its dissolution to be published in the Official Gazette in Form STK 7 and the same shall also be placed on the official website of the Ministry of Corporate Affairs.
Tags Corporate Law