LIVE GST Certification Course by CA Arun Chhajer begins 27th April. Register Now!!

Describe the difference

Sindhuja Sivaraman (Student) (115 Points)

08 February 2023

Hello everyone,

Tell me the difference between Strike off and Liquidation of Companies?

Which is having less legal procedures to be carried out?

Thank you.

Reply
Follow
Share

1 Replies

Aarika (Finance Professional) (1650 Points)
Replied 08 February 2023

Strike off: Strike off is a process where a company is removed from the register of companies maintained by the Registrar of Companies (RoC). This is typically done when the company is inactive or has ceased to do business and is no longer in a position to pay its debts. The process is initiated by the company and involves submitting a formal application to the RoC for the removal of the company from the register.

Liquidation: Liquidation is a process where the assets of a company are sold and the proceeds are used to settle the company's debts. The process is typically initiated when a company is unable to pay its debts and is unable to continue its operations. In liquidation, the company's assets are sold, and the proceeds are used to pay off its creditors, and any remaining assets are distributed to the shareholders.

In terms of the number of legal procedures to be carried out, Strike off usually requires fewer legal procedures than liquidation.