Strike off Company

What Does “Striking Off Company” Mean?

Striking off a company means officially closing it by removing its name from the government’s records maintained by the Ministry of Corporate Affairs (MCA). After strike off, the company no longer exists as a legal entity and is free from future compliance or tax filings.

This process is governed under Section 248 of the Companies Act, 2013, and is a quicker and simpler way to close an inactive company compared to full winding-up.

It can be:

• Voluntary – applied by the company
• Compulsory – initiated by the Registrar of Companies (ROC)

Ways a Company Can be Struck Off

1. Voluntary Strike Off

If a company has stopped doing business and wants to shut down formally, it can apply for strike off by filing Form STK-2 with the ROC. This is the most common method used by startups and private limited companies that are no longer operating.

Conditions to apply:

• No business activity in the last two financial years
• No active legal cases or liabilities
• All filings up to date
• Consent from all directors/shareholders

2. Suo Motu (Compulsory) Strike Off by ROC

The Registrar of Companies may strike off a company on its own if:

• The company has not started business within 1 year of incorporation
• It hasn’t done any business for the last 2 financial years and hasn’t applied for dormant status
• It fails to file annual returns or other statutory filings
• It doesn’t respond to ROC notices
• It has no valid registered office

Once struck off, the company is no longer allowed to operate, hold assets, or enter into contracts.

Important Forms for Struck Off Company

• Form STK-2: Application for the removal of the name of the company.
• Form STK-3: Indemnity bond to be given by every director.
• Form STK-4: Affidavit by every director.
• Form STK-8: Statement of accounts certified by a Chartered Accountant.
• Form MGT-14: Filing of resolutions with the ROC.

Common Challenges in Strike Off

• Unpaid Liabilities: All dues must be cleared before applying.
• Incomplete Documentation: Missing or incorrect documents can lead to rejection.
• Pending Litigation: Ongoing legal cases can delay or prevent strike off.
• Lack of Shareholder Approval: Failure to obtain necessary approvals can halt the process.
• ROC Processing Delays: Delays may occur due to administrative processing times.

Why Tax Intelligence?

Tax Intelligence is a leading business platform providing comprehensive corporate legal services, including company incorporation, compliance, advisory, and management consultancy, both in India and internationally. The platform offers fast, easy, and affordable, Closure of LLP, Removal of Company Name from MCA Records, Company Annual Compliance, CCFS for Pvt Ltd. and many more.