REMOVAL OF NAME OF COMPANY FROM THE REGISTER OF COMPANIES UNDER COMPANIES ACT 2013 THROUGH E-FORM STK-2

Chaper – XVIII

Sections – 248, 249, 250, 251 and 252 of Companies Act, 2013 (replaced with Section 560 of Companies Act, 1956)

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

Main features –

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 percent members in terms of paid up share capital, file an application in prescriber 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.  

E-Form STK 2 – Application by company for removing its name from Register of companies is notified by MCA and is available for filing on MCA website

Also Read : Documents Required for Removal/Striking off of Company under E-form STK-2

This e-Form is required to be filed under Sections 248 (2) of the Companies Act, 2013 and Rule 4,5, 6 and 8 of the Companies (Removal of Names of Companies from the Register of Companies)Rules, 2016 as given hereunder –

Sections/Rules Requirements Details
Section 248 (1)

 

Suo-moto by Registrar of Companies ROC shall send a notice to the company and all its directors, of his intention to remove the name of company from the register of companies and requesting them to send their representation along with copies of relevant documents, if any – within a period of 30 days from the date of the notice, if

1.       A company has failed to commence its business within one year of its incorporation; or

2.       A company is not carrying on any business or operation for a period of two immediately preceding financial years and has not made any application within such period for obtaining the status of a dormant company.

 

PS – Form STK 2 can be filed by only Active company or Dormant company.

Section 248 (2)

 

Application by Company Company may file an application before the Registrar of Companies for removing the name of company from register of members of the following conditions are fulfilled –

1.       A company has failed to commence any business activity within one year of its incorporation; or

2.       A company is not carrying on any business or operation for a period of two immediately preceding financial years and has not made any application for obtaining the status of dormant company. And

3.       A special resolution is to be passed in this regard or to obtain consent of 75% members in terms of paid up share capital;

Exceptions of Section 248 Categories of companies which shall not be removed from the register of companies under Section 248 read with Rule 3 and 4 1.       Listed companies

2.       Companies de-listed due to non-compliance of listing regulations or listing agreement or any other statutory laws

3.       Vanishing companies

4.       Companies where inspection and investigation is ordered and being carried out or actions on such order are yet to be taken up or complete but prosecution arising out of this is pending in court;

5.       Companies where notices under Section 234, 206 and 207 of Companies Act, 1956 have been issued by Registrar of Companies and is still pending for completion;

6.       Companies against which any prosecution for an offence is pending;

7.       Companies whose compounding application is pending before competent authority;

8.       Companies which have accepted Public deposits and which are either outstanding or is in default of repayment;

9.       Companies which have pending charges for satisfaction;

10.   Companies registered under Section 25 or section 8 of the Companies Act, 1956.

Section 249 Restrictions A company shall not make application under Section 248 (2), if at any time in the previous three months, the company –

1.       Has changed its name or shifted its registered office from one state to another

2.       Has made a disposal for value of property or rights held by it, immediately before cesser of trade or otherwise carrying on of business, for the purpose of disposal for gain in the normal course of trading or otherwise carrying on of business

3.       Has engaged in any other activity except the one which is necessary or expedient for the purpose of making an application under that section or deciding whether to do so or concluding the affairs of the company or complying with any statutory requirements

4.       Has made an application to the tribunal for the sanctioning of a compromise or arrangement and the matter has not been finally concluded; and

5.       Is being wound up whether voluntarily or by the Tribunal.

Rule 4(2) Requirements of NOC Following companies will be required to furnish NOC –

1.       Companies which have conducted or conducting non banking financial and investment activities

2.       Housing finance Companies

3.       Insurance Companies

4.       Companies in the business of capital market and Intermediaries

5.       Companies engaged in collective investment Scheme

6.       Asset Management Companies

7.       Any other company registered under any other law

Rule 4(3)

 

 

 

 

 

 

 

 

Documents required for filing any application with ROC in e-Form STK 2 1.       Statement of accounts containing assets and liabilities of the company for not more than 30 days before the date of application and certified by a Practicing Chartered Accountant;

2.       An affidavit in Form STK – 4, by every director of the Company

3.       Indemnity Bond in Form STK – 3 to be given individually or collectively by the directors

4.       A copy of special resolution duly certified by each of the Directors of the company or consent of 75% of the members of the company in terms of paid up share capital as on the date of  application;

5.       A statement of pending litigation, if any;

6.       Copy of approval from concerned regulatory authority, if any, approving the filing of application;

7.       Copy of de-listing order from Stock Exchange, if applicable;

8.       Other attachments as per applicable laws;

9.       Optional attachments, if any, – KYC of all directors i.e. Pan copy and Address proof self attested copies

PS – in case of foreign nationals or Non-resident Indian, the indemnity bond, affidavit, declaration and all documents pertaining to Foreign National shall be Notarised or Apostilled  (As per Rule 8)

Rule 5 (1) Signing of application Application will be signed by –

1.       Director or manager or

2.       CEO/CFO or

3.       Secretary of the Company

Authorised by the Board of directors as the case may be;

PS – if the directors does not have registered digital signature certificate the a physical copy of form duly filled in shall be signed manually by the director duly authorised in that behalf and shall be attached with the form.

 

Rule 6 Certification

 

 

e-Form STK 2 shall be professionally certified by Either a –

1.       CA in Whole time practice, or

2.       CMA in Whole time practice, or

3.       CS in Whole time practice

Rule 7 Manner of publication of notice by ROC The notice under Section 248 (1) & (2) shall be in Form STK 5 or STK 6, as the case may be.
Rule 9 (Section 248 (5)) Notice of striking off by ROC Registrar (ROC) shall cause a notice of striking off the name of the company from the ROC if no objection received and its dissolution to be published in the official gazette in Form STK 7 and the same shall be placed on the official website of MCA
Rule 10 Pending form FTE for approval Pending proceedings for Form FTE filed with Registrar of Companies prior to commencement of these rules, but not disposed off by such authority for want of any information or document shall, on its submission, to the satisfaction of authority, be disposed off in accordance with the rules made under the Companies Act 1956.
Section 249 (2) Penalty Provisions Violation of Section 248 (1) shall be punishable with fine which may extend to Rs. 1 lakh.
Section 251 (read with section 248 & 249 of the Companies Act 2013) Penalty Provisions Where it is found that an application by a company has been made with the object of evading the liabilities of the company or with the intention to deceive the creditors or to defraud any other person, the person in charge of the management of the company shall, notwithstanding that the company has been notified as dissolved –

·         Be jointly and severally liable to any person or persons who had incurred loss or damage as a result of the company being notified as dissolved, and

·         Be punishable for fraud in the manner as provided in section 247.

Section 252 Appeal to the Tribunal Shall file an appeal within a period of three years from the date of order of ROC –

·         Any person aggrieved by an order of the Registrar, notifying a company as dissolved under Section 248, may file an appeal to the Tribunal

·         If the Tribunal is of the opinion that the removal of the name of company from the Register of Companies is not justified in view of the absence of any of the grounds on which the order was passed by the Registrar, it may order restoration of the name of company in the Register of Companies.

·         Before passing any order, the Tribunal shall give a reasonable opportunity of making representation and of being heard to the Registrar, the company and all the persons concerned. 

 

DORMANT COMPANY –

As per Section 455 of the Companies Act, 2013 – where a company is formed and registered under this act for a future project or to hold an asset or intellectual property and has no significant accounting transaction, such a company or an inactive company may make an application to the Registrar in the manner prescribed under Rules for obtaining the status of a dormant company.

Explanation – for the purpose of this section –

Inactive Company means a company which has not been carrying on any business or operation, or has not made any significant accounting transaction during the last two financial years or has not filed financial statements and annual returns during the last two financial years.

Significant accounting transaction means any transaction other than –

  1. Payment of fees by a company to the Registrar;
  2. Payments made by it to fulfil the requirements of this act or any other law;
  3. Allotment of shares to fulfil the requirements of this act; and
  4. Payments for maintenance of its office and records

VANISHING COMPANY –

Vanishing company means a company, registered under the Companies Act, 1956 and listed with Stock Exchange which, has failed to file its returns with Registrar of Companies and Stock Exchange for a consecutive period of two years, and is not maintaining its registered office at the address notified with the Registrar of Companies or Stock Exchange and none of its directors are traceable.

 

PROCEDURE OF FILING APPLICATION BEFORE THE REGISTRAR OF COMPANIES IN E-FORM STK 2 – (RULE 4(1)) –

Following procedure is to be followed for removing the name of the company from the register of companies –

  1. Call and held Board meeting to pass board resolution for the purpose of striking off or removing its name from Register of Companies and authorise any director of the company to file an application
  2. After holding of board meeting, if there is any liability in the company, the company will set off all liabilities.
  3. Call and held AGM and pass special resolution
  4. File MGT 14 with 30 days of passing Special resolution
  5. File an application for removal of name of the company under Section 248 (2) in e-forms STK 2 along with filing fee of Rs. 5000 with all required attachments.

PS – Event date is not applicable for STK 2 filing. Filing fee is payable subject to change in pursuance of the Act or any other Rule or Regulation made or notification issued thereunder.

 Author : Shipra Singh

Ms. Shipra Singh is Practising Company Secretary and practices in the area of Corporate Laws and Advisory. She helps  entrepreneurs and business owners start and grow their business.

Ms. Shipra Can be reached at csshiprasingh@gmail.com