Closing of a Company under section 248 of Companies Act,2013

What is sec 248?

The sec 248 of companies act,2013 deals with Power of Registrar to remove name of company from Register of Companies.

Situations where the Registrar may remove the name of the Company from registrar of companies

  • A company has failed to commence its business within one year of its incorporation
  • 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 u/s 455.
  • The subscribers to the memorandum have not paid the subscription which they had undertaken to pay at the time of incorporation of a company and a declaration to this effect has not been filed within one hundred and eighty days of its incorporation.
  • The company is not carrying on any business or operations, as revealed after the physical verification carried out under sub-section (9) of section 12 Register office of the company.

Can Company file for removal of name from register on their own?

Yes, the company can file application for removing it name from the registrar of companies, after fulfilling the below conditions:

  • Extinguishing all the liabilities of the company.
  • Passing a special resolution or consent of seventy-five per cent members in terms of paid-up share capital.

What are the forms to be used to close a company under sec 248?

An application for removal of name of the company shall be made in Form STK-2 along with the fee of five thousand rupees.

Filing of Form STK-2:

Once the above conditions has been satisfied the company can file Form STK-2 provided that

The form is not applicable to the companies registered under section 8 and 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

The application in Form STK 2 shall be accompanied by

  • Indemnity bond duly notarized by every director in Form STK 3
  • A statement of accounts containing assets and liabilities of the company made up to a day, not more than thirty days before the date of application and certified by a Chartered Accountant
  • An affidavit in Form STK 4 by every director of the company
  • A copy of the special resolution duly certified by each of the directors of the company or consent of seventy-five per cent of the members of the company in terms of paid up share capital as on the date of application
  • A statement regarding pending litigations, if any, involving the company

How we can help You?

To help defunct companies and inoperative companies to wind up its business without following many procedures, Companies act, 2013 vide Section 248 has provided an option of applying for removal of its Company’s name from the Registrar by filing an application in a prescribed manner to the Registrar. Earlier Ministry of Corporate Affairs has issued Fast Track Exit (FTE) Mode opportunity to the defunct companies to get their names struck off from the register in time bound manner. This was given as guidelines in Companies act 1956, however, now the same option is been embedded in Section 248 of Companies Act, 2013.

Disclaimer:"The information contained herein is only for informational purpose and should not be considered for any particular instance or individual or entity. We have obtained information from publicly available sources, there can be no guarantee that such information is accurate as of the date it is received or it will continue to be accurate in future. No one should act on such information without obtaining professional advice after thorough examination of particular situation."

Prepared By

G Manoj