CLOSURE OF PVT LTD COMPANY
VOLUNTARY CLOUSURE OF COMPANY
A private limited Company requires various compliances like filing of annual return, audited accounts with ROC & filing of income tax return. Failing to maintain compliance for a Company could result in fines and/or disqualification of the Directors from incorporating another Company. Therefore, if a private limited Company has become inactive and there are no transactions in the Company, then it is best to close the Company.
Even though business of the Company is closed, unless closure documents are filed and approved by the ROC, Company is not legally closed and the Company needs to file all the regular returns.
The Company being is a creation of law; it can be closed by the Rules prescribed under the Companies Act. An inactive or defunct Company can be struck off U/s 148(1) by filing STK-2 Form to the ROC with CS/CA Certification, affidavits and indemnity bonds.
After filing & approval of closure documents with ROC Company is officially closed.
The entire process for winding up of a Company can be completed within 6 to 12 months, subject to government processing times.
PROCESS OF STRIKING OFF COMPANY
Cease Commercial Activity
A strike off of Company can be done if it has never commenced business after incorporation or have ceased commercial activity. Hence, if the Company is operational and the promoters wish to close it, the Company must first cease all commercial activity.
Close Bank Account (s)
A Company must ensure before strike off that they have no creditors and no open bank account. Hence, prior to filing Form STK-2, any bank account opened in the name of the Company must be closed and a letter evidencing closure of the bank account in the name of the Company must be obtained from the Bank.
The company can file the STK-2 application only when the shareholders of the company adopt a special resolution. A minimum of 75% shareholders vote is necessary for passing a special resolution.
Check DIN & DSC Status
Every year DIR-3(KYC) must be filed to keep the DIN active; check the DIN status; if the KYC has not been filed, Please do file the DIN KYC. As the application for striking off the company is filed using Digital Signature, check if the DSC is valid for the partners; if not, obtain DSC.
Prepare Affidavits & Declaration
All the Director of the Company must execute an affidavit, either jointly or severally to the effect that
The Company has not commenced business or where it commenced business, it ceased to carry on such business.
The Company has no liabilities and indemnifying any liability that may arise even after striking off its name from the Register.
The Company has not opened any Bank Account and where it had opened, the said bank account has since been closed together with certificate(s) or statement from the respective bank demonstrating closure of Bank Account.
The Company has not filed any Income-tax return where it has not carried on any business since its incorporation, if applicable.
There should not be any pending litigation for the applicant company with the state government, central government, or agencies. Also, check that no Income Tax or GST Assessment is pending.
Filling of Overdue Returns & Pay all Government Dues
A Company requires to file any overdue Annual Filling i.e., Form AOC-4 Form MGT-7, up to the end of the financial year in which the Company ceased to carry on its business or commercial operations before filing Form STK-2.
Ensure that all government dues such as GST, Income Tax, PF, ESIC or any other company's liability towards the government are fully paid before closure of Company.
Certification from CA
A statement of accounts disclosing NIL assets and NIL liabilities, certified by a practising Chartered Accountant up to a date not earlier than thirty days of the date of filing of Form STK-2 must be obtained.
Filling of Striking off (Form STK-2)
Form STK-2 along with above mentioned documents will be filed with the MCA to strike off name of Company. On processing the application, if found acceptable, the concerned Registrar of Companies would cause a notice to be published on the MCA website announcing the striking off of the Company.
BENEFITS OF VOLUNTARY CLOSURE OF COMPANY
1. FREE FROM COMPLIANCE BURDEN & PENALTY
Annual Compliances of Company are not required to be done after closure.
Penalties & disqualification of director can be avoided after closure.
2. SAVE MONEY
Closure is easy & cheap as compare to annual compliances.
There are legal compliances which needs to be done even if the Company does not do any business or which is inactive. Closing an inactive Company is always a wise decision which will ultimately result in saving money.
3. NO PENALTY / DISQUALIFICATION
Penalties & disqualification of Company & Directors can be avoided after closure.
4. FAST TRACK EXIT
Fast track striking off of Company can be done within 6 to 12 months.
DOCUMENTS REQUIRED FOR CLOSURE OF COMPANY
Required Documents List
MOA & AOA.
PAN & Aadhar Card of Director.
Digital Signature of Director.
All ITR & Annual Return Filled with ROC
Bank Closure Statement.
ALL INCLUSIVE PACKAGE INCLUDES
Drafting of Affidavit & Indemnity Bond
Conducting Board & General Meeting & Drafting of Resolution for Closure of Company
CA Certificate on Statement of Accounts
Filing of Form MGT-14 & Form STK-2 with ROC & CS Certification
Managing Winding up process & follow up
Note: Our packs DO NOT include ROC Fee of Rs. 10,500, Notary Service or the Cost of Stamp Paper.
(We will draft the documents, and you have to buy stamp paper from a local stamp vendor and get the affidavits and indemnity bond notarised)