Section 560
This query is : Resolved
15 March 2012
Please give the brief explanation of section 560 of companies act 1956 and meaning of FTE?????????????????????????????????????????????????????????? please help me out.........
16 March 2012
Hi
Defunctioning of the Company (Sec. 560)/ Striking Off of a Company
After a company is incorporated, irrespective of its activities, there are certain mandatory responsibilities and obligations which it is required to discharge. This includes preparation of annual accounts, getting them audited, filing income tax return, filing annual return with the Registrar of Companies (ROC) and so on. The directors of the company are responsible for discharging such duties and obligations of the company, failing which the company and its Directors are liable to be penalized.
Sometimes, the purpose for which the company was formed has already been achieved; or the purpose may never be achieved for some reason. Sometimes, no activities are being carried on in the company and the company for all practical companies is a defunct company. Since the winding up and dissolution of a company involves intervention of a court of law and is a time consuming process, many managements do not wish to dissolve a company. The company becomes defunct. Under these circumstances, it is advisable for the promoters/directors of such company to shut down the company i.e. to remove the name of the company from the register of companies maintained by the ROC. The provisions of Section 560 of the Companies Act, 1956 (the Act) apply to such companies.
According to the provisions of section 560 of the Act, a company is deemed to be a defunct company if it does not carry any business or is not in any operation. Under such circumstances, the ROC has the power to strike out the name of the company from the register, after cmplying the prescribed procedure.
Regards
Defunctioning of the Company (Sec. 560)/ Striking Off of a Company
After a company is incorporated, irrespective of its activities, there are certain mandatory responsibilities and obligations which it is required to discharge. This includes preparation of annual accounts, getting them audited, filing income tax return, filing annual return with the Registrar of Companies (ROC) and so on. The directors of the company are responsible for discharging such duties and obligations of the company, failing which the company and its Directors are liable to be penalized.
Sometimes, the purpose for which the company was formed has already been achieved; or the purpose may never be achieved for some reason. Sometimes, no activities are being carried on in the company and the company for all practical companies is a defunct company. Since the winding up and dissolution of a company involves intervention of a court of law and is a time consuming process, many managements do not wish to dissolve a company. The company becomes defunct. Under these circumstances, it is advisable for the promoters/directors of such company to shut down the company i.e. to remove the name of the company from the register of companies maintained by the ROC. The provisions of Section 560 of the Companies Act, 1956 (the Act) apply to such companies.
According to the provisions of section 560 of the Act, a company is deemed to be a defunct company if it does not carry any business or is not in any operation. Under such circumstances, the ROC has the power to strike out the name of the company from the register, after cmplying the prescribed procedure.
Regards
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17 March 2012
thanks for this brief explanation
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