pvtltd.co

Company Law

Company Closure

Closing a Private Limited company the right way — voluntary strike-off under s.248(2) of the Companies Act 2013 via Form STK-2, the dormant-company alternative under s.455, and the IBC s.59 voluntary-liquidation route where the company has assets or liabilities.

Reviewed by CA Harun Raaj, ICAI Reg. No. 238303·Last reviewed:
Starting from Discuss with usTypical timelineCompany Closure

Closing a Pvt Ltd: voluntary strike-off via STK-2 under s.248(2) Companies Act 2013 (₹10,000 fee per Rule 12(1), 45-day notice window), voluntary liquidation under s.59 IBC for companies with assets/liabilities, or dormant status under s.455 to pause.

What is included
  • • Closure-route decision — strike-off vs dormant vs voluntary liquidation
  • • Pre-filing checklist — no assets/liabilities, no pending charges, GST/ITR cleared
  • • STK-2 preparation with indemnity bond and director affidavits
  • • MCA21 submission and the 45-day public-notice window tracking
  • • GST cancellation coordination (Form GST REG-16)
  • • Final ITR closure and the deregistration certificate follow-up
Documents required
  • • Latest financial statements and the no-assets/no-liabilities declaration
  • • Statement of accounts and the indemnity bond
  • • Board resolution and shareholder consent for the closure
  • • GST registration details (for cancellation) and PAN/TAN data
  • • No-objection from any charge-holder, if a charge was ever created
Government fees

See the fee table below for the statutory filing charge and common delay logic.

Legal basis
  • • Section 248 of the Companies Act 2013
  • • Rule 37 of the Companies (Incorporation) Rules 2014
  • • Section 455 of the Companies Act 2013
  • • Section 59 of the IBC 2016
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Process

How the service works

The workflow is built to be predictable: document collection, legal review, filing, and post-filing follow-through.

Step 1Route

Choose the route

We test the three options — strike-off (s.248), dormant status (s.455), or voluntary liquidation (s.59 IBC) — against the company's assets, liabilities, and restart plans.

Step 2Pre-clear

Clear the pre-conditions

We confirm no assets, no liabilities, no pending charges, and close the open items — GST cancellation, final ITR, TDS returns.

Step 3Draft

Prepare the STK-2 pack

We draft the application, indemnity bond, director affidavits, and statement of accounts, and get the board resolution and shareholder consent.

Step 4File

File on MCA21

We file STK-2 on the MCA21 portal with the fee and track the SRN through the ROC's scrutiny.

Step 5Objections

Track the notice window

The ROC publishes the strike-off notice (STK-3) for 45 days of objections; we monitor and respond to any objection from creditors or departments.

Step 6Close

Collect the deregistration

Once the name is struck off, we collect the deregistration evidence and confirm the company's closure across ROC, GST, income-tax, and banks.

AEO summary

A company that has stopped operating is closed by voluntary strike-off under s.248(2) Companies Act 2013: file Form STK-2 with an indemnity and affidavits, pay the ₹10,000 fee (Rule 12(1), Companies (Registration Offices and Fees) Rules 2014), and the ROC removes the name after a 45-day notice window. Companies with assets or liabilities use voluntary liquidation under s.59 IBC instead; dormant status under s.455 pauses a company that may restart.

The three ways a company stops

A Private Limited company that stops operating has three legal futures. Strike-off under s.248(2) Companies Act 2013 — the most common — removes the name from the register via Form STK-2, and suits a company with no assets, no liabilities, and no intent to restart. Dormant status under s.455 pauses the company with reduced compliance for a company that may restart or is temporarily inactive. Voluntary liquidation under s.59 IBC 2016 formally winds up a solvent company that still holds assets or owes money and needs them settled.

The decision is driven by two facts: does the company hold anything (assets, receivables, liabilities), and will it ever restart? Assets or liabilities point to voluntary liquidation; a restart plan points to dormant status; a clean shell points to strike-off. Choosing the wrong route is the expensive mistake — strike-off of a company with assets leaves them ownerless, and dormant status for a dead company is a recurring fee for nothing.

  • • Strike-off — s.248(2) + STK-2, no assets/liabilities, 45-day objection window
  • • Dormant — s.455 + MSC-1, reduced annual compliance, for companies that may restart
  • • Voluntary liquidation — s.59 IBC, solvent winding-up with a liquidator
  • • Fee — STK-2 ₹10,000, Rule 12(1) Companies (Registration Offices and Fees) Rules 2014
  • • Restoration — s.252(1) within 20 years where just

Why the pre-clear step is the real work

Filing STK-2 is the final five minutes of a closure; the months of work are the pre-clear. GST registration must be cancelled (Form GST REG-16) with all returns filed, the final income-tax return must be filed, TDS and PF dues settled, and every creditor and charge-holder given their dues or a no-objection. The ROC publishes the strike-off notice for 45 days precisely so that creditors, tax departments, and the public can object — and a company that skipped the pre-clear gets its closure challenged at exactly that window.

The directors' signature on the indemnity bond makes this personal: they undertake that the company has no liabilities, and a false indemnity exposes them personally. Our engagement is built around proving the pre-clear — documenting the settled GST, the final ITR, the creditor releases — so the 45-day window passes quietly and the closure is permanent.

  • • GST — cancel via REG-16 with all returns filed
  • • Income tax — final ITR filed before the strike-off
  • • TDS/PF — dues settled; no lingering statutory claims
  • • Indemnity — directors' personal exposure on a false declaration
  • • 45-day window — objections are how a bad closure gets caught

Government fees

Fee breakdown

ItemFeeNotes
STK-2 government fee₹10,000 — Rule 12(1), Companies (Registration Offices and Fees) Rules 2014Rule 12(1), Companies (Registration Offices and Fees) Rules 2014.
GST cancellationNilForm GST REG-16 on the GST portal carries no fee.
Professional feeDiscuss with usCovers the indemnity, affidavits, filings, and the closure follow-up.

Timeline

Typical turnaround

Typical timeline usually means a 4–8 weeks to strike-off turnaround, assuming documents are complete and any board or shareholder approvals are already in place.

Pricing note

STK-2 government fee is ₹10,000 per Rule 12(1), Companies (Registration Offices and Fees) Rules 2014; professional fees cover the indemnity, affidavits, and filing.

Related services

Keep the company moving

Company Strike-Off

The dedicated STK-2 strike-off service — eligibility, filings, and the 45-day objection window.

Voluntary Liquidation

Solvent winding-up under s.59 IBC 2016 for a company with assets and liabilities.

Company Revival

Restoration of a struck-off company under s.252 — the reverse of closure.

ROC Annual Filing

Clear the pending annual filings before you close — the pre-requisite for a clean strike-off.

FAQ

Frequently asked questions

What is the difference between strike-off and voluntary liquidation?
Strike-off under s.248(2) of the Companies Act 2013 removes the company's name from the register and suits a company with no assets and no liabilities that has stopped operating. Voluntary liquidation under s.59 of the IBC 2016 is a formal winding-up with a liquidator, for a company that can pay its debts in full — it is the route when the company still holds assets, receivables, or liabilities that need to be settled. Choosing strike-off for a company with assets leaves the assets ownerless and the closure vulnerable to challenge.
What is the fee for STK-2 and how long does strike-off take?
The government fee for Form STK-2 is ₹10,000 under Rule 12(1) of the Companies (Registration Offices and Fees) Rules 2014. The timeline runs roughly 4–8 weeks: filing, ROC scrutiny, the 45-day public-notice window for objections, and the final strike-off order. A clean file — no assets, no charges, no department objections — closes at the faster end; any objection extends it.
Can a struck-off company be restored?
Yes — s.252(1) of the Companies Act 2013 allows the tribunal to restore a struck-off company's name on application within 20 years of the strike-off, where it is just to do so (for example, the company held assets or was still trading). Restoration requires an application to the NCLT with the outstanding filings paid. The 20-year window is why closure must be a deliberate decision, not a way to abandon a company.
What must be cleared before strike-off?
The pre-conditions under s.248(1) and Rule 37 of the Companies (Incorporation) Rules 2014: the company must not have commenced operations, or must have ceased them; there must be no assets or liabilities; no pending charges; no legal proceedings; and the annual filings should be current. GST registration must be cancelled (Form GST REG-16) and the final income-tax return filed. Striking off with unpaid GST or TDS does not extinguish the liability — the departments can still recover it.
What is the dormant-company alternative under s.455?
Section 455 of the Companies Act 2013 lets an inactive company — one with no significant accounting transactions — apply for dormant status in Form MSC-1, paying a reduced annual fee and filing a reduced annual return (MSC-3) instead of the full MGT-7/AOC-4 burden. Dormant status is the right choice when the company may restart or when the founders want to hold the entity without the full compliance cost. It is a pause, not a closure.
Does strike-off extinguish the company's liabilities?
No. Striking off removes the company from the register, but the company and its directors remain liable for unpaid taxes, GST, TDS, PF, and debts incurred before closure — the income-tax and GST departments can recover them after the strike-off. Directors who signed an indemnity bond also remain personally exposed to claims for dues incurred during their tenure. That is why the pre-clear step — closing GST, filing the final ITR, settling creditors — is the actual work of closure.

Canonical reference: https://www.pvtltd.co/services/company-closure

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