The Fast Track Exit (“FTE”) Scheme was introduced by the Ministry of Corporate Affairs in 2011 as a guideline-based route for defunct companies to obtain a strike-off under Section 560 of the Companies Act, 1956. The scheme was designed to provide a time-bound and cost-effective exit for companies that had no assets, no liabilities, and no ongoing operations. It has limited applicability today, because the Companies Act, 1956 has been replaced by the Companies Act, 2013, and the strike-off regime is now governed by Section 248.
The Historical Context
The FTE scheme was available to companies that had been inactive for at least one year, had nil assets and liabilities, had no pending litigation, and had no outstanding tax or statutory dues. The scheme excluded listed companies, de-listed companies, Section 25 companies (the predecessor to Section 8 companies), and companies against which the ROC had issued a notice under Section 234 or an inspection was pending.
The Current Position
The Companies Act, 2013 came into force on 1 April 2014, and it replaced Section 560 of the 1956 Act with Section 248. The FTE scheme, which was framed under the 1956 Act, has been superseded by the Section 248 strike-off regime and the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016. The current route is the STK-2 application or the ROC’s suo motu power under Section 248.
The Residual Relevance
The FTE scheme may still be relevant to companies that were struck off under the 1956 Act and that wish to challenge or regularise the strike-off. The revival of a company struck off under the FTE scheme is governed by Section 252 of the 2013 Act, and the limitation period is computed from the date of the strike-off order.
A company that is considering an exit should use the Section 248 route, not the FTE scheme. The FTE scheme is a historical artefact, and it is not a current compliance option.
Call to Action
Anuj Desai & Associates advises companies on the current strike-off regime under Section 248—from the STK-2 application and the ROC’s suo motu power to the revival of a struck-off company. If you are considering an exit, we can help you choose the right route.
📧 office@anujdesaiassociates.com
📞 9619456656
🌐 https://anujdesaiassociates.com
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