The process of company closure is also referred to as PVT Ltd company closure or strike off. In India, such work is done as per the rules of the Companies (Removal of Names of Companies) Rules, 2016. It is administered by Section 248 of the Companies Act, 2013. So, if you want to close private limited company in Bangalore, this is what you have to follow. Experts would advise you that if you are not running your company you should simply close it off.
The process of closing a private limited company has to be done by filing with the Form STK 2.
Previously, Form FTE was used for the purpose. But nowadays, you would apply it through STK Form. You also need to pay a government fee for the purpose. At present this fee is 10000 rupees. However, it can always change in the future. This is why it would be better if you could check out the latest figure in that regard.
There are a few steps that have to be filed in this regard.
First of all, you have to pay off all your liabilities that you have in your business.
Once you have paid off your dues, you would have to get a No Objection Certificate from them. However, if you are yet to start your business or operations as such this clause would not be applicable for you.
In the second step you would need 75 per cent consent. This is one of the new requirements that have come up in this regard. This means that in order to wind up your company, you would need the consent of 75 per cent of the members and shareholders of your company. Furthermore, one director has to come forward and take all the responsibility for the closure of the company.
Once you have gotten the consent, you would have to prepare the application. You would have to file it with ROC (Registrar of Companies). During filing the application, there are some necessary documents that have to be submitted along with it.
Business owners can apply for closing of a company while these issues take place:
You (legal directors) can apply for closure if you have not started doing business within a year of incorporating the company.
In case, if you have not done any business in the past couple of financial years and have also not asked for the status of a dormant company as per Section 455 of the Act, you can apply for closure as well.
There are two types of documents that are needed in this case – mandatory and optional. The mandatory documents may be enumerated as below:
The optional documents are PAN (Permanent Account Number) card of the company as well as certificates of closing the bank account. The companies that offer such services normally need you to provide them in scanned formats.
There are three kinds of winding up of a company –
In mandatory, winding up a company would have to file a petition for closure.
This can also be done by the following:
All the documents that you supply with the petition would have to be audited by a chartered accountant, who is practicing presently. The auditor would have to provide an unqualified financial statement.
You would have to advertise the petition for two consecutive weeks. The advertisement needs to be in the regional language of the area where you are doing the business as well as in English. You would have to submit Form 11 in this case. You need to submit some important documents in this case such as fully audited books of your accounts. This has to be done till the date when you are making the application.
If you are looking for voluntary winding up, you would have to pass a board resolution in accordance with the Companies Act 2013. You need to make sure that most directors of your company have agreed to the winding up.
In these cases, you also need a special resolution where 75 per cent of the shareholders have to vote in favour of closing the company. You also need the trade creditors to approve this act of winding up the company.
If your company is defunct or dormant, you would have to follow an advanced process. Here you would have to submit the STK-2 form. This particular form has to be filled up by ROC. The director of the company would also have to approve of the same. However, she or he has to be supported by the board so that she or he can perform such an action.
There are many companies in Bangalore that can help you in this regard. But BusinessWindo is something different from them. We can audit, draft your documents and get your signature as well. This takes around a week to be completed. After this, we would proceed for the closure. After that we would file for closing the company. The ROC would approve of the same and send a notice to you as well. This would take around 3 months to be accomplished.
In the final stages, the company name would be struck off from the records once there is no objection in a 6 to 8-month period after you have received the ROC notice.
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