Section 248 of the Companies Act, 2013 ("the Act") permits the removal of a company's name from the register of companies on two routes: the Registrar of Companies' suo motu power and the company's own application. The two routes have different grounds, different procedures, and different consequences, and a company that confuses them will find that its application is rejected or that its name is struck off without its consent.
The ROC's Suo Motu Power
Section 248(1) permits the ROC to strike off a company's name where the company has failed to commence its business within one year of incorporation, has not carried on any business or operation for two immediately preceding financial years and has not applied for dormancy, has not filed its financial statements or annual returns for two consecutive financial years, or has not paid the subscription money and not filed the declaration under Section 10A. The ROC must issue a notice to the company and to its directors, and it must publish the notice in the Official Gazette and on its website. If no cause is shown within thirty days, the ROC may strike off the name.
The Company's Application
Section 248(2) permits a company to apply to the ROC for strike-off where it has extinguished all its liabilities, has no assets, has not commenced operations or has ceased operations, and has obtained the consent of at least seventy-five per cent of its members. The application is made in Form STK-2, with a board resolution, an indemnity bond in Form STK-3, a statement of accounts in Form STK-8 certified by a chartered accountant, and an affidavit in Form STK-4.
The 2026 procedure routes the application through the Centre for Processing Accelerated Corporate Exit (C-PACE), which is designed to reduce the processing time. The ROC may reject the application if the company has outstanding liabilities, pending litigation, or statutory dues.
The Consequences
The strike-off does not extinguish the company's liabilities. The members and directors remain liable for the company's debts, and the ROC may revive the company if it later discovers that the strike-off was obtained by suppression of material facts. The assets of the company vest in the members, and the directors are disqualified under Section 164(2) if the company had not filed its financial statements for three consecutive years before the strike-off.
The strike-off is the fastest and cheapest exit route, but it is available only for companies that have no assets and no liabilities. A company that has assets or liabilities must use the winding-up or IBC route.
Call to Action
Anuj Desai & Associates advises companies and directors on both strike-off routes—from the eligibility assessment and the STK-2 application to the ROC's suo motu notice and the defence against compulsory strike-off. If your company is considering a strike-off or has received a notice, we can help you navigate the process.
📧 office@anujdesaiassociates.com
📞 9619456656
🌐 https://anujdesaiassociates.com
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