{"id":36708,"date":"2022-04-28T13:28:25","date_gmt":"2022-04-28T07:58:25","guid":{"rendered":"https:\/\/www.cagmc.com\/?p=36708"},"modified":"2024-06-01T14:54:28","modified_gmt":"2024-06-01T09:24:28","slug":"how-to-strike-off-company-within-1-year-of-incorporation","status":"publish","type":"post","link":"https:\/\/www.cagmc.com\/blog\/how-to-strike-off-company-within-1-year-of-incorporation\/","title":{"rendered":"How to Strike off Company within 1 year of Incorporation?"},"content":{"rendered":"<p><img fetchpriority=\"high\" decoding=\"async\" class=\"alignnone wp-image-36726 size-full\" src=\"https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/04\/How-to-Strike-off-Company-within-1-year-of-Incorporation-1.png\" alt=\"How to Strike off Company within 1 year of Incorporation\" width=\"1200\" height=\"630\" srcset=\"https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/04\/How-to-Strike-off-Company-within-1-year-of-Incorporation-1.png 1200w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/04\/How-to-Strike-off-Company-within-1-year-of-Incorporation-1-300x158.png 300w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/04\/How-to-Strike-off-Company-within-1-year-of-Incorporation-1-1024x538.png 1024w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/04\/How-to-Strike-off-Company-within-1-year-of-Incorporation-1-615x323.png 615w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/04\/How-to-Strike-off-Company-within-1-year-of-Incorporation-1-400x210.png 400w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/04\/How-to-Strike-off-Company-within-1-year-of-Incorporation-1-292x153.png 292w\" sizes=\"(max-width: 1200px) 100vw, 1200px\" \/><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">Did you <\/span><span style=\"font-weight: 400;\">register your company<\/span><span style=\"font-weight: 400;\">, but somehow the business does not take off? Then what are the safeguards there to protect you? How can you protect yourself from the problems? What are the ways by which you can strike off your company? It is common for a business idea to not take off. Further, you should be prepared in case something like this happens. You should be prepared for the worst-case scenario, before <\/span><span style=\"font-weight: 400;\">starting your own business<\/span><span style=\"font-weight: 400;\">. In this article we will discuss about how to Strike off a Company within 1 year of Incorporation.<\/span><\/p>\n<table style=\"width: 100%;\">\n<tbody>\n<tr>\n<td style=\"border: 1px solid #555;\"><b>Table of Content<\/b><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#What\"><span style=\"font-weight: 400;\">What does Striking off Company mean?<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#Can\"><span style=\"font-weight: 400;\">Can you Strike off a Company Within One year of Incorporation?<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#How\"><span style=\"font-weight: 400;\">How can you to Strike off a Company<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#Reasons\"><span style=\"font-weight: 400;\">Reasons for which a Company can apply to Strike off<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#Documents\"><span style=\"font-weight: 400;\">Documents Requirement<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#Restrictions\"><span style=\"font-weight: 400;\">Restrictions in Striking off Company<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#Procedure\"><span style=\"font-weight: 400;\">Procedure to Strike off Company<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#Ways\"><span style=\"font-weight: 400;\">Ways to Restore a Company that is Struck Off<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#Conclusion\"><span style=\"font-weight: 400;\">Conclusion<\/span><\/a><\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h2 id=\"What \" style=\"text-align: justify;\"><b>What does Striking Off Company means?<\/b><\/h2>\n<p id=\"Can\" style=\"text-align: justify;\"><span style=\"font-weight: 400;\">Striking off the name of a company is a mechanism\u00a0by which a business may close it\u2019s operations. The <a href=\"https:\/\/www.cagmc.com\/roc-filing\/\">Registrar of Companies (RoC)<\/a> are able to issue a notice notice to strike off the name of a registered company from the Register of Companies, for certain reasons. Further, The Company by themselves can apply to the RoC to remove its name from the Register of Companies.<\/span><\/p>\n<h2 style=\"text-align: justify;\"><b>Can you Strike off a Company Within One year of Incorporation?<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">The section 248 to 252 of the <\/span><span style=\"font-weight: 400;\">Companies Act, 2013<\/span><span style=\"font-weight: 400;\"> provides the procedure for Striking off a Company. As per Sec 248(1) of the Companies Act, a company may strike off its name if the Registrar has a reason to believe that a company has failed to commence\u00a0its business within one year of its incorporation. Further, as per sec 248(2), before striking \u00a0off its name a company has to take care of all its liabilities.\u00a0<\/span><\/p>\n<p id=\"How\" style=\"text-align: justify;\"><span style=\"font-weight: 400;\">Moreover, 75% of the board members has to pass a special resolution to apply to the RoC to remove its name from the Register of Company. It has to be in all ground specified in the sub-section 1. Further, on receiving\u00a0the application the Registrar may issue a public notice in the prescribed\u00a0manner.<\/span><\/p>\n<h2 style=\"text-align: justify;\"><b>How can you Strike Off a Company<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">There are two ways to Strike off a Company,<\/span><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">By the RoC on its own<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">By application of the Company for removal<\/span><\/li>\n<\/ul>\n<p id=\"Reasons\" style=\"text-align: justify;\"><span style=\"font-weight: 400;\">For a company to apply to Strike off its name, it has to pass a special resolution or obtain\u00a075% votes of the members (in terms of paid-up capital) to file an application to the RoC.<\/span><\/p>\n<h2 style=\"text-align: justify;\"><b>Reasons for which a Company can apply to Strike off<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">After taking care of its liabilities, a company may strike off its name if it can prove the following grounds,<\/span><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It fails to or does not commence business within one year of incorporation<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It has a receipt\u00a0Subscription Money and files <\/span><span style=\"font-weight: 400;\">INC 20A<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">A year has not passed from the date of incorporation.<\/span><\/li>\n<\/ul>\n<p style=\"text-align: justify;\">Or, the Company is inoperative for the last two financial year. However, it has not filed an application within this period to get the status of a dormant company under section 455 of the Act.<\/p>\n<h2 style=\"text-align: justify;\"><b>Documents Requirement<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">To Strike off you company you will require the following documents,<\/span><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Certified true copy of board resolution for authorization given for filing the\u00a0application.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Registered <a href=\"https:\/\/www.cagmc.com\/what-is-digital-signature-certificate\/\">Digital Signature Certificate<\/a> of director for signing the form.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Memorandum of association of the Company<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Article of Association of the Company.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Identity\u00a0Proof\u00a0(<a href=\"https:\/\/www.cagmc.com\/how-to-apply-for-instant-pan-card\/\">PAN Card<\/a>\/Aadhar Card\/Voter ID card).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Residence proof (Passport\/Driving License\/Voter ID Card)<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Statement of account duly certified by a chartered accountant.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Affidavit in Form STK-4 and Indemnity bond in Form STK-3 duly notarized.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Certified true copy of Special Resolution<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">No Objection Certificate (NOC) from certain regulator authorities such as, <a href=\"https:\/\/www.cagmc.com\/non-banking-finance-company-in-india\/\">Non-Banking Financial Companies<\/a>, Housing Finance Companies,\u00a0Insurance Companies,\u00a0Asset Management Companies, etc.\u00a0<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Restrictions in Striking off Company<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">A company can\u2019t apply to strike off it\u2019s name if within the last three months from the date of submitting it has done any of the following,<\/span><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Changed its name<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Shifted its office from one state to another<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Made a disposal of value of rights or property held by it<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Filed an application to the National Company Law Tribunal for sanctions of an arrangement or compromise and the matter has not finished<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Has engaged in other activities<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">There is a pending investigation<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">There are public deposits which are yet to be repaid<\/span><\/li>\n<\/ul>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">These are governed by sec. 249 for the<a href=\"https:\/\/en.wikipedia.org\/wiki\/Companies_Act_2013\" target=\"_blank\" rel=\"noopener\"> Companies Act, 2013<\/a>.<\/span><\/p>\n<h2 style=\"text-align: justify;\"><b>Procedure to Strike off Company<\/b><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The Registrar on its own can Strike off Company. The RoC send a notice about its intention to Strike off Company.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The Directors have to send representation to the RoC within 30 days.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, on the expiry of the notice period, the RoC may Strike off Company.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Further, a notice will be published by the Roc in the official Gazette.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">If no objections are received within 30 days then another notice about the dissolution of the company will be published.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Otherwise, a company may apply to Strike off. Similarly, a notice will be published in the Gazette.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Further, a letter of informant is sent to<\/span><span style=\"font-weight: 400;\"> Income Tax Authorities<\/span><span style=\"font-weight: 400;\">,\u00a0Central Excise Authorities\u00a0and\u00a0Service Tax Authorities.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">If there are no objections from the public and the respective authority then the company is dissolved. The company will cease to exist after the Strike off.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Ways to Restore a Company that is Struck Off<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">Any individual who is affected by the dissolution of the Company may appeal to the Tribunal. However, they have to appeal within 3 years. Further, if the tribunal finds that the dissolution of the Company is not justified it can order to restore the company. The Company has to file a copy of the order passed by the tribunal to the RoC within 30 days. The RoC will then restore the company name in the Register of Companies and issue a fresh Certificate of Incorporation.<\/span><\/p>\n<h2 style=\"text-align: justify;\"><b>Conclusion<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">If a Company has not started any business within one year of its incorporation then it can apply to Strike off. \u00a0You can fast-track the closing of your company in this manner. Moreover, it is the simplest way to dissolve a company. \u00a0You can cut your losses much quicker. The process of closing a business can be very hectic. This will make it much easier.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Did you register your company, but somehow the business does not take off? 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