Strike off can be understood as removal of something from somewhere, when it comes to the term of business , it means removing the very existence of any company by removing its name from the records of respective Registrar of Companies.   Strike off in general term is known as to remove or erase someone from somewhere where the same used to exist. In business term strike off of Companies means cessation of existence of a Company and removing the name of the Company from the database of list of companies maintained with the Ministry of Corporate Affairs of India.

1. Voluntary Strike Off
Exit Route for Companies

2. What is
Strike Off
Strike off can be understood as removal of something from somewhere, when it comes
to the term of business , it means removing the very existence of any company by
removing its name from the records of respective Registrar of Companies.
Strike off in general term is known as to remove or erase someone from somewhere
where the same used to exist. In business term strike off of Companies means
cessation of existence of a Company and removing the name of the Company from the
database of list of companies maintained with the Ministry of Corporate Affairs of India.
2

3. Type of
Strike Off
3
Company can exit from its corporate entity in two ways. In both cases existence of
Company puts to an end.
▪ Suo Moto/Voluntary Strike Off: When a Company itself makes an application to
the Registrar of Companies for removal of its name from database of Registrar, it
is called as Strike off by the Company on its own.
▪ Compulsory/Mandatory Strike Off: The Registrar of the Companies when
satisfied that Company is not carrying any business or not complied certain
provisions , the Registrar on its own issue notice to the Company for its striking
off.

4. 4
Rationale for
making Suo-
Motto
Application
of Strike Off
Every Company subsist to fulfil some objective for which Company was incorporated in
the first place. It may happen that the purpose for which the Company was established
got accomplished and it is no more rationale to continue the Company as a legal entity.
For example if a Company was formed pursuant to a joint venture and after completion
of project, company is no longer required in such case, Company can itself file for strike
off its name from Register of Companies.
Further it may also happen that the purpose for which Company was set up remains
unfulfilled due to various reasons like adverse pricing, increase in competition,
government regulation etc. In such scenario businessmen resort to close the Company
to save the cost of running business in absence of any productive business.
In both cases, where Company needs to be closed down and for this ministry of
corporate affairs has stated provisions. Company being a legal entity came into
existence through process of registration under the Companies Act, 2013 (“Act”)
similarly exit of Company is also governed through strike off’s provisions of the Act

5. When
Application
can be filed?
5
As per section 248(2) of the Act a company can make an application to the Registrar
only if following conditions are satisfied:
• Company has extinguished all its liability
• Company has accorded members approval through Special Resolution
• If Company is regulated under any other act, beside the Companies Act,2013 then
approval of such regulatory body to be obtained.

6. Restriction
on Filing
Application
6
As per section 249 of the Act, an application on behalf of a company shall not be made
if, at any time in the previous three months, the company:
• has changed its name or shifted its registered office from one State to another
• 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;
• has engaged in any other activity except the one which is necessary or expedient
for the purpose of making an application under that section,
• has made an application to the Tribunal for the sanctioning of a compromise or
arrangement and the matter has not been finally concluded; or
• is being wound up under Chapter XX of this Act or under the Insolvency and
Bankruptcy Code, 2016
It is important to note that If Company has already received notice from Registrar
under section 248(1) of the Act, then Company is not allowed to make application
under this section.
If a company files an application in violation of these provisions, it shall be punishable
with fine which may extend to one lakh rupee.
If the registrar came to know of any such contravention, application will be rejected by
the Registrar.

7. Fradulent
Application
for Removal
of Name
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As per section 251 of the Act, if any Company intentionally makes fraudulent
application with the Registrar to deceive the creditors or to evade its liability , then the
director, person in charge of Company will be liable even if the Company got dissolved:
• Liable to any person or persons who had incurred loss or damage as a result of
the company being notified as dissolved; and
• Liable for punishment for fraud in the manner as provided in section 447.
Registrar may also recommend prosecution of the persons responsible for the filing
such fraudulent application.

8. 8
Steps be
taken for
Strike Off
As per rule 4 of the Companies (Removal of Names of Companies from the Register of
Companies) Rules, 2016 following process to be followed:
Company shall call Board Meeting of directors to consider proposal of striking off of
Companies
Board at its meeting discuss the proposal considering financial status and operations of
the Company
Directors will approve the resolution and authorise directors to file indemnity and affidavit
on behalf of the Company
Call EGM / AGM to accord approval of members through special resolution for striking off
of the Company
If Company is registered under any other authority it sahll take prior approval of such
authority like RBI, SEBI,IRDA etc
After approval of members and post approval of authorities (if any), Company will file E
Form STK 2 with the ROC

9. 9
Steps be
taken for
Strike Off
Along with STK 2 Company should file , special resolution, indemnity by directors in Form
STK 3 and affidavit in STK 4 by all directors
Company should also file a statement of accounts made up to a day, not more than 30
days before the date of application and certified by a CA in Form STK 8
The ROC will publish a notice in the Official Gazette and in newspaper for the
information of the general public in Form of STK-6
The ROC will inform authorities like IT, Excise etc for seeking objection if any in 30 days
and if no reply received, consent of these authorities will be deemed to be obtained
The ROC after being satisfied will strike off the name of the Company
ROC will again also publish a notice in the Official Gazette for the information of the
general public in STK-7

10. 10
Other
Restriction
on Filing
Application
for Strike Off
As per rule 3 of the Companies (Removal of Name of Companies from the Register of
Companies) Rules, 2016 following categories of companies shall not be removed from
the register of companies:
• Listed Companies
• Companies that have been delisted due to non-compliance of listing regulations or
listing agreement or any other statutory laws
• Vanishing Companies
• Companies where inspection or investigation are pending in the Court.
• Companies against which any prosecution for an offence is pending in any court;
• Companies, which have accepted public deposits which are either outstanding or
the company is in default in repayment of the same;
• Companies having charges which are pending for satisfaction; and
• Companies registered under section 8 of Companies Act, 2013 or section 25 of
erstwhile Companies Act, 1956

11. 11
Legal
Aspects of
Strike Off
• Name of the Company will be removed from the Register of Companies.
• The liability, if any, of every director, manager or other officer who was exercising
any power of management and of every member of the company dissolved shall
continue and may be enforced as if the company had not been dissolved.
• The Registrar, shall satisfy himself that sufficient provision has been made for the
realisation of all amount due to the company and for the payment or discharge of
its liabilities and obligations by the company within a reasonable time and, if
necessary, obtain necessary undertakings from the managing director, director or
other persons in charge of the management of the company:
• The assets of the company shall be made available for the payment or discharge
of all its liabilities and obligations even after the date of the order removing the
name of the company from the register of companies.

12. 12
Restoration
of Struck Off
Companies
Section 252 of Companies Act, 2013 states the provision where a struck off company
can be restored after making an appeal to NCLT. Such appeal can be filed in three ways
as given below:
1. By Aggrieved Person:
• If a Company got struck off and any person is aggrieved by such order he may
file an appeal to NCLT within a period of 3 years from the date of order.
• If NCLT is of opinion that strike off was not justified, it can order to restore the
Company in the Register of Companies.
• In such case NCLT shall give a reasonable opportunity of making representations
and of being heard to the Registrar, the company and all the persons concerned.
2. By Registrar of Companies:
• If a Company got struck off and Registrar is satisfied that name got struck of
inadvertently or on the basis of incorrect information furnished by the company ,
registrar may within a period of 3 years from the date of order make an appeal
to NCLT
• If NCLT is of opinion that strike off was not justified, it can order to restore the
Company in the Register of Companies.
• In such case NCLT shall give a reasonable opportunity of making representations
and of being heard to the Registrar, the company and all the persons concerned

13. 13
Restoration
of Struck Off
Companies
3. By Company or member or creditor or workman
• After strike off of Company, the company, member, creditor or workman may
file an appeal to NCLT before the expiry of 20 years from the date of order to
restore the name of the Company.
• If NCLT is of opinion that strike off was not justified, it can order to restore the
Company in the Register of Companies.
• In such case NCLT shall give a reasonable opportunity of making representations
and of being heard to the Registrar, the company and all the persons concerned
In all three cases Company after getting order from NCLT, shall file the order with the
Registrar within 30 days from the date of order in form INC 28
The Registrar will further restore the name of the Company and issue a fresh certificate
of incorporation.

14. 14
Strike Off
Forms at
Glance
STK 2 E Form to file by Company for application of Strike off
STK 3 Format of Indemnity to file with STK 2
STK 4 Format of Affidavit to file with STK 2
STK 6 Public notice given by the ROC when Company makes application to the ROC
STK 7 Notice of Strike off of Company by the Registrar
STK 8 Format of statement of asset and liability to form with STK 2

15. Thank you very much
for your time
15
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