Important aspects of Strike Off

Companies Act 2013 deals with the provisions of Strike off of Company whether applied by Company or ordered by the Registrar of Companies.

The Companies (Removal of Name of Companies from the Register of Companies) Rules, 2016 and section 248-252 of Chapter XVIII Removal of Names of Companies From the Register of Companies deals with these provisions.

In this article we will cover other than procedural aspects related to strike off.

Restriction on making application to the Registrar 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:

  1. Listed Companies
  2. Companies that have been delisted due to non-compliance of listing regulations or listing agreement or any other statutory laws
  3. Vanishing Companies
  4. Companies where inspection or investigation are pending in the Court.
  5. Companies where any prosecution ,inquiry or scrutiny, if any, is pending with the Court arising out non-compliance of provisions of the Act or Companies Act, 1956
  6. Companies against which any prosecution for an offence is pending in any court;
    Companies whose application for compounding is pending before the competent authority for compounding the offences committed by the company or any of its officers in default;
  7. Companies, which have accepted public deposits which are either outstanding or the company is in default in repayment of the same;
  8. Companies having charges which are pending for satisfaction; and
  9. Companies registered under section 8 of Companies Act, 2013 or section 25 of erstwhile Companies Act, 1956

Legal aspect 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.

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 National Company Law Tribunal (NCLT).

Such appeal can be filed in three ways as given below:

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

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

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.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this:
search previous next tag category expand menu location phone mail time cart zoom edit close