Company and LLP Closure (Strike-Off)

What strike-off is

Strike-off is the removal of a company's name from the register of companies under section 248 of the Companies Act, 2013, on an application in Form STK-2. Applications are processed by the Centre for Processing Accelerated Corporate Exit rather than by the state Registrar, which has made the route more predictable than it once was.

It is a closure route for entities with nothing left in them — no assets, no liabilities and no ongoing operations. A company with unresolved creditors, pending litigation, secured charges or live regulatory proceedings is not a strike-off case and should not be presented as one.

When a company qualifies

The two ordinary grounds are that the company has not commenced business within one year of incorporation, or that it has not carried on any business or operation for the two immediately preceding financial years without applying for dormant status. Before applying, all liabilities must be extinguished, and the members must approve by special resolution or by consent of holders of at least seventy-five per cent of the paid-up capital. Overdue annual filings up to the date business ceased have to be brought up to date first.

The STK-2 pack

• Board resolution approving closure and authorising the filing
• Special resolution or consent of members holding seventy-five per cent of paid-up capital
• Statement of accounts showing nil assets and liabilities, certified by a chartered accountant and not older than thirty days from the application
• Indemnity bond from every director
• Affidavit from every director confirming the facts stated
• Evidence that bank accounts have been closed and the entity's PAN details

Closing an LLP through Form 24

An LLP that has ceased commercial operations, or has not carried on business for one year or more, applies to the Registrar in Form 24. The application needs the consent of all partners, a statement of account showing nil assets and liabilities certified by a chartered accountant, a copy of the latest income tax return, and affidavits and indemnities from the designated partners. Form 8 and Form 11 must be filed up to the end of the financial year in which the LLP stopped trading — the point at which most LLP closures actually stall.

When closing beats staying compliant

A dormant private company still owes an annual return, financial statements, a statutory audit, an income tax return and director KYC every single year, and the additional fee on late MCA filings runs daily with no upper limit. Two or three years of drift costs more than the closure would have.

The counterweight is that strike-off is not amnesty. The liability of directors and officers survives dissolution and can be enforced as though the company were still in existence, and a struck-off entity can be restored by the Tribunal within the prescribed period. If there is a real dispute or an unpaid statutory due, deal with it rather than closing over it.

Why close through TCC

Most rejected strike-off applications fail on the same things — filings not brought up to date, a statement of accounts older than thirty days, or a bank account still open. We sequence the work so the pack is complete and current when it goes in, and we tell you honestly at the outset if your entity is not a strike-off candidate.