How to Cancel Company Registration Under Companies Act
Every business has to survive through the hardship and apparent obstacles to earn profit irrespective of their size or nature of work. But sometimes even the well-planned strategies couldn’t save the businesses from being hindered by adversity that occurs unexpectedly. and in such cases business left with no other option than cancel company registration.
Individuals can commence a business with a goal they wish to deploy and oftentimes when things don’t work as expected; they might have to be close due to several reasons which include insufficient funds, poor management, and zero working capital.
There are primarily two options for companies to cancel company registration.
- Fast Trick Exit (FTE) mode
Fast Track exit mode is one of the methods through which a company can be dissolved without following the lengthy process of winding up. It is an easy way to close those companies that are not having any assets or liabilities.
It requires a lot of time to register a company but at the same time, there are a number of companies which registered under Companies Act but because of various reasons they want to exit business or have become inoperative or started off the business but later became defunct; for all such and many other companies who are closing down their business, the Ministry of Corporate Affairs introduced the method of Fast track Exit which can now simplify the exit work for companies.
The following are the required documents to file an application with a prescribed fee of Rs. 5,000.
- An affidavit.
- Indemnity Bond.
- Statement of Account.
- Copy of Board Resolution.
The application procedure to get the name of a company struck off under Fast Track Exit scheme is given below.
- A Company eligible to apply for striking off its name needs to apply to Registrar of Companies in STK-2
- The FormSTK-2, should be filed electronically on the Ministry of Corporate Affairs portal namely www.mca.gov.in and by making payment of Rs. 5000/-;
- Application in Form STK 2 shall be signed by a director duly authorized by the Board in their behalf.
- In case, the digital signature of any of the director or Manager or Secretary is not available for affixing to Form FTE, a physical copy of the Form duly filled in, shall be signed manually by a director authorized by the Board of Directors of the Company and shall be attached with the application Form at the time of its filing electronically;
- Form STK- 2 , shall be certified by a Chartered Accountant in whole time practice or Company Secretary in whole time practice or Cost Accountant in whole time practice;
- Any pending litigations involving the Company should be disclosed while applying under this Fast track exit mode;
- Attachment documents as stated in question no. 7
- Upload STK- 2 with MCA.
- The Dormant Status
This mode is fitting when you have enlisted an organization for a future venture. A dormant company is mainly inactive and has the below-mentioned status:
- No useful activity or business
- No major monetary exchanges have occurred
- Not filled fiscal reports and yearly returns
It is useful to apply for ‘Dormant status’ as it diminishes the expenses of keeping up with such an organization. Such organizations get excluded from including budget reports, decrease consistence for holding a gathering each quarter and hope to hold just two gatherings yearly, and need not pivot the examiners. Note that an organization can have this status for just five years.
There are extensive details to cater to while closing a company or cancelling company registration. Be stress-free and let our experts advisors at S2SBizsolution.in guide you through every step. Contact us.
Once a business or organization is registered, numerous compliance requirements have to be met. But, when it comes to cancelling the registration, it has to be in the business’s best interest.