Company Strike Off in India (2026) – Process, Documents & Consequences

In India, thousands of companies are registered every year, but not all of them continue operations. Some businesses never commence after incorporation, while others shut down within a few years due to financial challenges, market conditions, or change in founders’ plans. However, even if a company is inactive or not earning revenue, it still needs to file ROC returns, ITR, and other compliances. Failing to do so attracts heavy penalties and director disqualification.

For such cases, the Companies Act, 2013 provides a legal mechanism called Company Strike Off, which allows companies to close operations permanently by removing their names from the Registrar of Companies (ROC) records. Once a company is struck off, it ceases to exist legally and is free from future compliance obligations.

A company can apply for voluntary strike off if it has no operations or business activity. Similarly, the ROC can also initiate strike off against companies that fail to commence business within one year of incorporation or remain inactive for two consecutive years.

In this blog, we’ll cover everything you need to know about Company Strike Off in India and its process, required documents, consequences, differences between voluntary and ROC strike off, and how to close your company legally without penalties.

What is Company Strike Off?

Company Strike Off is the legal process of removing a company’s name from the Registrar of Companies (ROC) records, under Section 248 of the Companies Act, 2013. Once a company is struck off, it is considered as if it no longer exists in the eyes of law. This means it cannot carry out business activities, own property, or file compliances in the future.

There are two ways a company can be struck off:

1. Voluntary Strike Off
   • When a company itself decides to shut down operations because it is inactive or has no future plans.
   • The directors/shareholders file an application using Form STK-2 to close the company.
2. Strike Off by ROC (Suo Motu)
   • The Registrar of Companies can strike off a company if it:
     • Fails to commence business within 1 year of incorporation.
     • Does not carry out any business for 2 consecutive financial years and has not applied for dormant status.

Strike Off vs Winding Up

• Strike Off is a simple, fast-track process for closing inactive companies with no liabilities.
• Winding Up is a longer, court-driven process used for companies with debts, disputes, or complex issues. See our full guide to winding up here: A step-by-step guide to winding up a company.

In short: Strike off is the most cost-effective way to close an inactive company legally and avoid compliance burdens.

When Can a Company Apply for Strike Off?

Not every company is eligible to apply for strike off. The Companies Act, 2013 lays down clear conditions under which a company can apply for removal of its name from the ROC records. Generally, strike off is allowed only when the company is inactive, debt-free, and not involved in any ongoing legal disputes.

Situations Where a Company Can Apply for Voluntary Strike Off

• Company has not commenced business: If a company has not started operations within 1 year of incorporation, it can apply for strike off.
• Company is inactive: If a company has not carried out any business or activity for the past 2 consecutive financial years and has not applied for dormant status.
• No liabilities or pending obligations: The company must have no loans, liabilities, or pending statutory dues. All bank accounts must be closed before applying. (If you need help with statutory closures like GST cancellation, see: How to cancel your GST registration.)
• Board and shareholder approval: The Board of Directors and at least 75% of shareholders (by voting power) must approve the decision.

ROC-Initiated Strike Off

Apart from voluntary strike off, the ROC can also remove a company’s name suo motu if:

• It has failed to commence business within one year of incorporation.
• It has not filed annual returns and financial statements for the last two consecutive years.

In short: A company can apply for strike off only if it is inactive, debt-free, and not facing any pending litigation. Otherwise, ROC may itself initiate the process.

Process of Company Strike Off (Step-by-Step)

Closing a company legally in India requires following the process laid down under Section 248 of the Companies Act, 2013. The strike off process is fairly straightforward but must be done carefully to avoid rejection or future legal issues. Here’s a step-by-step guide:

Step 1: Hold a Board Meeting

• The Board of Directors passes a resolution to strike off the company.
• An Extraordinary General Meeting (EGM) may also be called to seek shareholder approval.

Step 2: Shareholder Approval

• At least 75% of shareholders (by voting power) must approve the strike off.
• The approval must be documented through a special resolution.

Step 3: Clear Liabilities & Close Bank Accounts

• Before filing, the company must repay all debts and settle liabilities.
• Pay pending statutory dues like ROC fees, GST, and Income Tax (if any).
• Close all active bank accounts in the company’s name.

Need help clearing liabilities? Contact us

Step 4: Prepare Documents

• Prepare affidavits, indemnity bond, statement of accounts (certified by a CA), and other required documents.
• Statement of accounts should not be older than 30 days from the date of application.

Step 5: File Form STK-2 with ROC

• Submit Form STK-2 online through the MCA portal. (See the MCA portal for official directions: Ministry of Corporate Affairs (MCA).)
• Attach all necessary documents (board resolution, shareholder approval, affidavits, indemnity bond, CA statement of accounts).
• Pay the prescribed government fee (typically ₹10,000).

Step 6: Public Notice by ROC

• ROC issues a public notice in the Official Gazette (Form STK-6).
• Objections, if any, can be raised within 30 days.

Step 7: Final Strike Off & Certificate

• If no objection is received, ROC strikes off the company’s name from its register.
• An official notice is published, and a dissolution certificate (STK-7) is issued.

Timeline

The entire process usually takes 3 to 6 months, depending on document accuracy and ROC workload.

In short: Company strike off involves board approval, shareholder consent, debt clearance, filing of STK-2, and ROC’s final approval. Once completed, the company legally ceases to exist.

Documents Required for Company Strike Off

Applying for a company strike off is not just about filing a form, it requires a proper set of documents to prove that the company is inactive, debt-free, and legally eligible for closure. The Registrar of Companies (ROC) will not approve the application unless all mandatory documents are submitted correctly.

Mandatory Documents

1. Board Resolution – Approving the decision to apply for strike off.
2. Shareholder Resolution – Special resolution passed by at least 75% of shareholders.
3. Indemnity Bond (Form STK-3) – Signed by all directors, confirming that they will be liable for future claims against the company.
4. Affidavit by Directors (Form STK-4) – Declaration that the company has no liabilities and is not involved in any legal proceedings.
5. Statement of Accounts – Prepared up to a date not older than 30 days from the application, certified by a Chartered Accountant.
6. Certificate of Incorporation – Copy of original incorporation certificate issued by ROC.
7. PAN Card of Company – Mandatory for identity verification.
8. Proof of Closure of Bank Accounts – Bank statement or closure letter showing that all accounts have been settled.

Additional Supporting Documents (if applicable)

• No Objection Certificate (NOC) from regulatory authorities, if the company was registered under special laws.
• Details of pending litigations, if any.

In short: Proper documentation ensures smooth strike off approval. Missing or incorrect papers can delay or even reject the application.

Consequences of Company Strike Off

Striking off a company means that its name is removed from the Registrar of Companies (ROC) records, and it ceases to exist as a legal entity. While this is an effective way to close inactive or non-operational companies, it comes with certain consequences that entrepreneurs must understand clearly before applying.

1. Company Ceases to Exist Legally

• Once struck off, the company cannot operate business activities, file ROC/ITR/GST returns, or own/transfer property in its name.

2. Assets of the Company

• If the company still owns assets (land, property, machinery, bank balance, etc.), they automatically vest with the Central Government after strike off. Hence, assets must be disposed of before applying.

3. Directors’ Liabilities Continue

• Even after strike off, directors remain liable for any fraud, misrepresentation, or offences committed before strike off, and for any outstanding liabilities or legal disputes.

4. Restoration of Company

• A struck-off company can be restored through the National Company Law Tribunal (NCLT) within 20 years of strike off, provided valid reasons are shown (e.g., ongoing business or unresolved disputes). For restoration process details, NCLT resource pages are useful: National Company Law Tribunal (NCLT).

5. Impact on Directors

• Directors of struck-off companies may face restrictions when registering new companies if compliance defaults existed. Multiple strike-offs can harm credibility with banks, investors, and MCA records.

In short: Strike off relieves a company from future compliance, but directors must ensure all liabilities are cleared beforehand. Otherwise, they may face legal and financial consequences even after closure.

Voluntary Strike Off vs ROC Strike Off

Key Takeaway:

• Voluntary Strike Off is a proactive step by companies that wish to close operations legally and avoid future penalties.
• ROC Strike Off is a warning sign, as it shows the company failed to comply with mandatory filings and was forcefully removed by the authorities.

In short: It’s always better for companies to go for voluntary strike off rather than wait for ROC action, as it maintains credibility and avoids penalties.

How TaxRupees Can Help

Closing a company may sound simple, but in practice, the strike off process requires careful documentation, approvals, and coordination with the ROC. Any errors like missing affidavits, incomplete financial statements, or pending liabilities can delay or even reject the application. That’s where TaxRupees ensures a smooth and hassle-free closure.

At TaxRupees, we provide end-to-end support for company strike off, including:

• Eligibility Check: Analyzing whether your company qualifies for voluntary strike off under Section 248.
• Document Preparation: Drafting board and shareholder resolutions, preparing indemnity bond (STK-3), affidavits (STK-4), and CA-certified statement of accounts.
• Filing Form STK-2: Submitting the application with MCA and paying government fees on your behalf.
• ROC Follow-Up: Handling queries and ensuring timely processing of your application.
• Legal Compliance: Making sure all liabilities, taxes, and statutory dues are cleared before closure to avoid future risks.

With TaxRupees, you get more than paperwork and we ensure your company is closed legally, safely, and with zero compliance worries.

CTA: Close your inactive or non-operational company with TaxRupees experts today and avoid unnecessary penalties or legal hassles.

FAQs on Company Strike Off in India

1. What does company strike off mean?

   Company strike off means removal of a company’s name from the Registrar of Companies (ROC) records. Once struck off, the company ceases to exist legally and cannot carry on any business.

2. What is the difference between strike off and winding up?

   Strike Off: A simplified, fast-track closure process for inactive and debt-free companies.
   Winding Up: A lengthy process (through NCLT/court) used when companies have debts, disputes, or insolvency issues.

3. Can a company apply for strike off if it has debts or liabilities?

   No. Before applying for strike off, all liabilities, loans, and statutory dues must be cleared. The company should be completely debt-free.

4. How long does the strike off process take?

   The process typically takes 3–6 months, depending on document accuracy, ROC scrutiny, and objections (if any).

5. Which form is used for company strike off?

   The application is filed in Form STK-2 along with necessary documents such as affidavits, indemnity bond, and CA-certified accounts.

6. What happens to company assets after strike off?

   If the company owns any assets at the time of strike off, they automatically vest with the Central Government. Hence, assets should be disposed of before applying.

7. Can ROC strike off a company without notice?

   No. ROC issues a public notice in the Official Gazette and allows 30 days for objections before striking off the company.

8. Can a struck-off company be restored?

   Yes. A struck-off company can be restored by filing an application with the National Company Law Tribunal (NCLT) within 20 years of strike off.

9. What happens to directors after strike off?

   Directors remain liable for any offences or fraudulent activities committed before strike off. Their credibility may also be affected if ROC struck off the company due to compliance defaults.

10. Do companies need to cancel PAN or GST separately after strike off?

    Yes. Strike off only removes the company’s name from MCA records. PAN and GST must be surrendered separately to avoid future notices. For step-by-step GST cancellation, refer to: How to cancel your GST registration.

11. What is the government fee for strike off?

    The filing fee for Form STK-2 is typically ₹10,000, excluding professional charges.

12. Is strike off better than keeping a dormant company?

    If the business has no future plans, strike off is better as it eliminates compliance costs. If the company may restart later, applying for dormant status is an alternative. See our annual compliance guidance: Company annual compliance in India.

? In short: Strike off is a cost-effective way to close inactive companies, but directors must ensure all liabilities are cleared and proper documentation is filed.