Closing down a company can be a difficult decision, but it may be the best course of action in certain circumstances. The process of closing a company in India is known as striking off. This article will guide you through the legal requirements, documentation, and procedures involved in Strike Off Company in India.
Legal Requirements for Strike off Company in India
Company Law Provisions for Strike off Company in India
Under the Companies Act, 2013, a company can be struck off from the register of companies maintained by the Registrar of Companies (ROC) in India. The following are the legal requirements for striking off a company in India:
- The company should not have any assets or liabilities.
- The company should not have any bank accounts.
- The company should not have any pending legal proceedings.
- The company should not have any tax liabilities.
- The company should have obtained all necessary approvals from the concerned authorities before striking off.
Voluntary Strike off Company in India
A company can apply for voluntary strike off if it meets the following criteria:
- The company has not commenced any business or activity since incorporation or has ceased to carry on its business or activity for a period of at least one year before making an application for striking off.
- The company has no liabilities and assets.
- The company has no outstanding statutory dues payable to the government.
Documents Required for Strike off Company in India
To strike off a company in India, the following documents are required:
- Board Resolution: A board resolution must be passed by the company’s directors approving the strike off process.
- Annual Financial Statements: The company’s annual financial statements for the previous year must be submitted to the Registrar of Companies (ROC) before the strike off process begins.
- Income Tax Returns: The company’s income tax returns for the previous year must also be filed with the ROC before the strike off process begins.
- Statement of Accounts: A statement of accounts must be prepared and submitted to the ROC, which should show that there are no outstanding debts or liabilities.
- Declaration of Solvency: A declaration of solvency must be prepared and signed by the directors of the company, declaring that the company will be able to pay all its debts and liabilities even after the strike off.
- NOC from Creditors: A no-objection certificate (NOC) must be obtained from all creditors of the company.
- Affidavit from Directors: An affidavit must be submitted by the directors stating that the company has not carried out any business activities since its incorporation or has ceased business activities, and that there are no legal proceedings against the company.
- Indemnity Bond: An indemnity bond must be submitted by all directors of the company, stating that they will indemnify any person for any loss or damage arising from the striking off of the company.
Once all these documents are prepared and submitted to the ROC, the strike off process can be initiated.
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