Winding up procedure

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

02 November 2013 Can any1 help me with the procedure of winding up of a newly incorporated subsidiary Company. The promoter have not paid the subscription money also and a year has passed since incorporation

Nikhil Kaushik

Nikhil Kaushik (Expert)
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02 November 2013 instead of winding up, it would be advisable to pay up the share capital and thereafter merge the subsidiary with the holding company. This is an easier method. Winding up is a very clumsy thing in India even when there are no assets or liabilities.

Querist : Anonymous

Querist : Anonymous (Querist)

20 November 2013 Cant it b done under FTE

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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03 August 2025 Yes, it can be done under the Fast Track Exit (FTE) scheme if the company meets certain criteria.

Fast Track Exit (FTE) Scheme — Overview
Introduced by MCA in 2016 to simplify winding up of companies that are non-operational and have no assets/liabilities.

Meant for companies that have not commenced business or have not carried on any business for at least 1 year.

Also applies if the company has no outstanding liabilities.

Eligibility for FTE:
Company must be a private limited company.

Must have no outstanding liabilities.

Must have not commenced any business or operation or has not carried out any business for at least 1 year.

No pending legal proceedings against the company.

Not involved in any investigation or prosecution under any laws.

The paid-up share capital must be less than Rs. 50 lakhs.

Annual turnover should be less than Rs. 2 crores.

Procedure under FTE Scheme:
Board Meeting: Pass a board resolution approving the application for winding up under the FTE scheme.

Application to ROC: File Form STK-2 (application for striking off the name) along with necessary documents:

Statement of account certified by a Chartered Accountant.

Declaration by directors confirming eligibility.

Public Notice: ROC will issue a public notice inviting objections for striking off.

No Objections: If no objections are received within 30 days, ROC will strike off the company from the register.

Certificate of Strike Off: ROC issues the certificate confirming winding up.

Advantages of FTE:
Faster and cheaper than regular winding up.

No need for appointing a liquidator.

No court involvement.

Your Case
Since your subsidiary:

Has not started business,

Promoters have not paid subscription money,

No assets or liabilities likely,

FTE scheme is the best option.

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