Removal of Names of Companies from the Register of Companies Under Companies Act 2013 by CS Shiriti Kumari


Provisions Applicable:

Chapter XVIII:  Removal of Names of Companies from Register of Companies.

Sections: 248, 249, 250, 251 and 252 of Companies Act, 2013

Rule: 3 & 4 of Companies (Removal of name of companies from Register of Companies) Rules 2016

Form: STK-2 (Application by Company to RoC for removing its name from Register of Companies)

Effective date: 26th December, 2016 

Various Important Forms:

STK-3    (Indemnity Bond duly notarised by every Director of the company)
STK-4    (An Affidavit from every Director of the company)
STK-5    (notice under sub-section (1) or sub-section (2) of section 248 to be published by MCA)
STK-6    (The notice under sub-section (1) or sub-section (2) of section 248 as the case may be)
STK-7    (Notice of striking-off shall be given by ROC)

Highlights

MCA has informed that “e-Form STK-2” (application by company for removing its name from register of companies) is made available w.e.f 5th April 2017.

Ministry of Corporate Affairs (MCA) issued a Notification dated 26th December, 2016 notifying Section 248, 249, 250, 251 and 252 of Companies Act, 2013 (Chapter XVIII).

Section 248-252 replaced Section 560 of erstwhile Companies Act, 1956. Accordingly, procedure for application with respect to closure of defunct company under Fast Track Exit Scheme (FTE) is expected to be ceased and replaced by new rules which have been notified by MCA.

e-Form STK-2 is required to be filed pursuant to Section 248(2) of the Companies Act, 2013 and rule 4, 5, 6 & 8 of the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 which are hereunder for your reference:

Section 248 (2): Without prejudice to the provisions of sub-section (1), a company may, after extinguishing all its liabilities, by a special resolution or consent of seventy-five per cent members in terms of paid-up share capital, file an application in the prescribed manner to the Registrar for removing the name of the company from the register of companies on all or any of the grounds specified in sub-section (1) and the Registrar shall, on receipt of such application, cause a public notice to be issued in the prescribed manner:

Provided that in the case of a company regulated under a special Act, approval of the regulatory body constituted or established under that Act shall also be obtained and enclosed with the application.

(Note: if taking consent from 75% in value of shareholders in terms of paid-up capital not required to hold EGM and file MGT-14)










Basic conditions required:


  • The company should extinguish all its liabilities;
  • Special resolution should be passed; or Consent of 75% members in terms of paid up share capital (if passing Special Resolution, MGT-14 need to be file otherwise 75% in value of shareholders consent takes in way of NOC)
  • Within one year of its incorporation if a company fails to commence its business; or is not carrying on any business or operation for a period of two immediately preceding financial years and has not made any application with such period for obtaining the status of a dormant company,
  • Company is regulated under a Special Act, the approval of the Regulatory Body constituted or established under that Act shall be obtained by the Company. Such approval shall be enclosed with the application;

Important Key Notes
  • The Company is required to of the company before commencing the process of strike off. Liabilities here means the outstanding debts, statutory taxes and other dues that are payable by the Company. The bank accounts of the company shall be closed down.
  • The company shall place the application, on its website, if any, till the disposal of the application;
  • Under Section 251(2) provides that without prejudice to the provisions of Section 251(1) the Registrar may also recommend prosecution of the persons responsible for the filing of an application under Section 248(2).
  • File MGT-14 within 30 days from the Event of EGM for Special Resolution;
  • Registrar of Companies shall, intimate the concerned authorities regulating the company, viz., the income tax authorities, Central excise authorities, service tax authorities 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 30 days from the date of issue of the letter of intimation and if no objections are received within 30 days from the respective authority, it shall be presumed that they have no objections to the proposed action of striking off or removal of name.
  • An application filed by the company may be withdrawn;
  • The Registrar may reject the application as soon as the conditions under Section 248(1) are brought to the notice.
  • Earlier the eligibility for applying for FTE was a company not carrying any business operations since last one year, however, now it is changed to a company not carrying any business or operation for a period of two immediately Preceding Financial Years.
  • Earlier under 1956, Board Resolution was Sufficient for approval for making application for removal of the name, however, now it is mandatory to Pass Special Resolution or take consent of 75% members in terms of paid up share capital.
  • Form STK-2 cannot be filed by a Section 8 company;
  • Filing of any other e-Form shall not be allowed by a company for which work item of eForm STK-2 is pending;
  • It is mandatory to enter the serial number and date of board resolution authorizing the signatory to sign and submit the e-Form;

//Conclusion //

E-Form STK-2 will be processed by the office of Registrar of Companies. When an eForm is approved/rejected by the authority concerned, an acknowledgement of approval/rejection letter along with related documents (if any) is sent to the user in the form of an email to the email id of the company.

Author:

CS Shiriti Kumari
Co-Founder of Compliance Calendar LLP
She can be reached at founders@compliancecalendar.in
91-9899195436 | 011-42345111

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