1. STRIKE OFF, REVIVAL THEREOFF & DIRECTOR DISQULIFICATION
Presented by:
CS Alok Kumar Kuchhal
Registered Insolvency Professional E: M:
Indiacorp Law
Advocates and Solicitors
“Anantprabha”, C -154, Sector 51
Noida
STRIKE OFF, REVIVAL THEREOFF
& DIRECTOR DISQULIFICATION

2. SHUT DOWN of COMPANIES

3. WAYS TO SHUT DOWN A COMPANY
 Following are the ways to close a company
WAYS TO SHUT DOWN A COMPANY
STRIKE - OFF
(Name of the company struck off from the register of companies)
WINDING – UP
(Assets of the company are first disposed than company is closed)
Done in two ways
Done in two ways
By Registrar of
Companies
At the request of a
company
Voluntary
Winding up
Compulsory
Winding up
Strike off and Winding up - both can be done in two ways. The same are mentioned above. Separate procedures are laid out in the Companies Act and rules made thereunder for each process. 4

4. Company is not carrying on any operations for continuous
STRIKE OFF
 Strike off is a process of REMOVING the name of the incorporated or registered company from the register of companies. The existence of a company comes to an end once the name of the company is removed from the register of companies.
 The Companies Act, 2013 and rules made there under contain provisions such as eligibility for strike off, procedure to strike-off and consequences etc. regarding strike-off. .
Companies Act, 2013
Chapter 18
Section
The
Companies
Act, 2013
Chapter 18
Section
248 to 252
ELIGIBILITY FOR STRIKE-OFF
Company is not carrying on any operations for continuous
2 years
Company fails to commence its business within 1 year from the date of registration OR 6

5. By Registrar of Companies (RoC) on its own motion
STRIKE OFF
PROCESS OF STRIKE OFF
(Name of the company struck off from the register of companies)
TWO WAYS OF STRIKE OFF
(Name of the company struck off from the register of companies)
By Registrar of Companies
(RoC) on its own motion
Section – 248 (1) of the Companies Act, 2013 deals with it
At the REQUEST of the
company
Section – 248(2) of the Companies Act, 2013 deals with it 7

6. By Registrar of Companies on OWN MOTION (Section – 248 (1))
STRIKE OFF
PROCESS OF STRIKE OFF
(Name of the company struck off from the register of companies)
By Registrar of Companies on OWN MOTION (Section – 248 (1))
Registrar of Companies (RoC) may Strike off a company on its own motion as per Section 248 (1) of the Companies Act, 2013.
A Company which falls under the eligibility criteria of Strike off (as mentioned above) may be struck off by ROC if the Company has not applied for the status of a DORMANT COMPANY. OR
DORMANT COMPANY Which is formed to hold
(Sec – 455) assets/Intellectual property
Application is OR
made to RoC for Which is formed for a future project
Which has no significant accounting transactions
Significant Accounting Transaction means, any
transaction other than-
 Payment of fees by a company to the
Registrar
 Payment made by it to fulfil the requirements
 Allotment of shares to fulfil the requirements
of the Companies Act, 2013 and rules made
thereunder
 Payment for maintenance of its office and
records
of this Act or any other law 8

7. By Registrar of Companies on own motion (Section – 248 (1))
STRIKE OFF
PROCESS OF STRIKE OFF
(Name of the company struck off from the Register of Companies)
By Registrar of Companies on own motion (Section – 248 (1))
RoC sends a notice to the Company and the Directors (in prescribed form) of its intention to remove the name of the Company from the register of companies
Directors shall send representation to RoC within 30 DAYS from the date of receipt of the
notice through Registered/Speed Post
After the expiry of the time mentioned in the notice, RoC may strike off the company unless cause to the contrary is shown by the company
Notice will be issued (in prescribed form ) by RoC and the same shall be published in official Gazette and placed on the website of Ministry of Corporate Affairs (MCA:
to seek objection from public within 30 days from the date of Notice
If no objection is received from public, notice of striking off the name of the company and its dissolution (in prescribed form) will be published in Official Gazette and Official Website of MCA 9

8. requisite Statutory fee
STRIKE OFF
PROCESS OF STRIKE OFF
(Name of the company struck off from the register of companies)
At the REQUEST of a Company (Section – 248(2))
Company may apply to RoC for Strike off the Company in prescribed form along with
requisite Statutory fee
Application form shall be accompanied with:
• Indemnity Bond in prescribed form
• Affidavit in prescribed form
• Copy of Special Resolution
• Statement of Accounts (not more than 30 days older from the date of application and certified by CA)
• Statement regarding pending litigation(s)
In case of following companies, No Objection Certificate (NOC) from regulatory authorities is also required:
• Non-Banking Financial Companies
• Housing Finance Companies
• Insurance Companies
• Asset Management Companies
• Companies engaged in Collective Management Scheme
• Companies in the business of Capital Market Intermediaries 10

9. At the REQUEST of a Company (Section – 248(2))
STRIKE OFF
PROCESS OF STRIKE OFF
(Name of the company struck off from the register of companies)
At the REQUEST of a Company (Section – 248(2))
Notice will be issued (in prescribed form ) and the same shall be published in official Gazette and placed on the website of MCA to seek objection from public within 30 days from the date of the notice
Letter of intimation will be issued by RoC to regulatory authorities namely: Income Tax Authorities
Central Excise Authorities
Service Tax Authorities
If no objection is received from public, notice of striking off the name of the company and its dissolution (in prescribed form) will be published in Official Gazette and Official Website of MCA 11

10. STRIKE OFF 12 has changed its name company activity
CASES IN WHICH COMPANY CANNOT APPLY FOR STRIKE OFF
has filed an
application to Tribunal for sanctioning of Compromise or Arrangement
Section 249 of
the Companies Act, 2013 describes the cases in which company cannot apply for Strike - off
has
changed its name
has shifted
registered office from one state to another
has made
disposal for value of property
Company cannot
apply for Strike off if any time in previous 3 months from the date of making application the
has
engaged in any other
company activity 12

11. STRIKE OFF
CASES IN WHICH COMPANY CANNOT APPLY FOR STRIKE OFF
FOLLOWING CATEGORIES OF THE COMPANIES SHALL NOT BE REMOVED FROM REGISTER OF COMPANIES
Listed Companies
Companies which have been delisted due to non- compliance of listing regulations
Vanishing companies
Companies where inspection or investigation is ordered and such order are yet to be taken up
Companies against which any prosecution for an offence is pending in any court
Companies whose
compounding is competent authority
application for
pending before the
AS PER RULE 3 OF COMPANIES (REMOVAL OF NAMES OF COMPANIES FROM THE REGISTER OF COMPANIES) RULES, 2016.
Companies which have accepted public deposits which are either outstanding or the company is in default in repayment of the same
Companies having charges which are pending for satisfaction
Companies registered
Companies Act, and rules made
under section 8 of the
thereunder 13

12. Recovery of Due & Discharge of Liability
STRIKE OFF
CONSEQUENCE OF STRIKE OFF
Sec 250 – From the Date of Publication of Notice of Strike off U/s 248 (5)
Cease to operate
Except For
COI Cancelled
Recovery of Due & Discharge of Liability 14

13. To evade Company’s liability
FRAUDULENT APPLICATION FOR REMOVAL OF NAME
As per Section 251 of the Companies Act, 2013, if fraudulent application is made for removal of name
To evade Company’s liability
To deceive creditors
 Company will be liable to person who has incurred losses
 Punishable for fraud u/s (explained in following slide)
 Registrar of Companies will recommend Prosecution 14

14. RESTORATION OF STRIKE OFF COMPANIES

15. Section 252 of the Companies Act 2013
RESTORATION
WAY TO RESTORE COMPANY STRUCK OFF BY ROC ON ITS OWN MOTION
Person aggrieved by the order of ROC may file an APPEAL/ APPLICATION to Tribunal
Section of the Companies Act 2013
Company
Member
Creditors
Workman
Any other person including director
Within 3 years / 20 years from date of ROC order
If removal of name is not justified, Tribunal will
order restoration of name of company 15

16. APPEAL/ APPLICATION SHALL BE MADE
WHERE TO APPLY?
APPEAL/ APPLICATION SHALL BE MADE
TO THE
HON’BLE TRIBUNAL*
11 Benches
Principal Bench at New Delhi
NCLAT, Delhi
Further Appeal
With in 45 days
Supreme Court, Delhi
With in 60 days
*As per section 2 (90), “ Tribunal” means the National Company L aw Tribunal constituted under Section 408 of Companies Act, 2013

17. Process File all pending Financial Statements and Annual Returns
Preparation Of Petition: (Rule 87A (1))
Appeal / Application to NCLT
Form No. NCLT-9.
Submission Of Petition With ROC: (Rule 87A(2))
Advance Copy of Appeal/ Application to ROC
Not less than 14 days before the date fixed for hearing
Hearing By Tribunal: (Rule 87A(3))
NCLT will hear both the Parties i.e ROC and Applicant
Tribunal may pass the Appropriate orders
Directions By Tribunal (Rule 87A(4))
Restoration order - Filing Of Order With Roc
Publication Of Order In Gazette
Pay Cost to ROC as directed by Tribunal
File all pending Financial Statements and Annual Returns

18. Process – Continued – List of Documents / Information
First
STK 1
STK 5
STK 6
STK 7
Second
Details of Applicants.
Details of the Company.
Capital Structure of the Company.
Registered Off ice of the Company.
Business of the Company.
Facts of the case.
Admission of default.
Reasons of default.
Steps taken to prove the bonafide.

19. Process – Continued – List of Documents / Information
Second
Grounds of appeal
Limitation
Jurisdiction
Affidavits
Court fee
Prayer
Interim
Final
Memorandum of Appearance/ Vakalatnama

20. DIRECTOR U/S 164 (2) OF COMPANIES ACT, 2013
DISQUALIFICATION OF
DIRECTOR U/S 164 (2) OF COMPANIES ACT, 2013

21. Section 164-Disqualification for appointment of Directors
(2) No person who is or has been a director of a company which—
(a) has not filed financial statements or annual returns for any continuous period of three financial years; or
(b) has failed to repay the deposits accepted by it or pay interest thereon or to redeem any debentures on the due date or pay interest due thereon or pay any dividend declared and such failure to pay or redeem continues for one year or more,
shall be eligible to be re-appointed as a director of that company or appointed in other company for a period of five years from the date on which the said company fails to do so.
Section 167(1)(a)
The office of a director shall become vacant in case :
a) He incurs any of the disqualifications specified in section 164
On a combined reading of both the section it could be inferred that the moment any person acquires any of the disqualification mentioned under section 164 he’ll have to vacate his office under section 167 and he’ll not be able to re-appointed as Director under that Company and also not able to be appointed as Director in any other Company by virtue of Sec 164 18

22. Removal of Disqualification
Way Forward
Removal of Disqualification
If the name has been removed erroneously file form DIR 10 as an enclosure to CG 1 to the Ministry for removal of Disqualification.
Appointment of New Directors
If name has been removed as a reason of non-filing of Financial Statements or Annual return for a continuous period of three years,
Apply to ROC for appointment of other directors (Company has to give the name of other two directors in application cum request letter and accordingly ROC will physically associate the DIN of those two directors and Company would then be able to file the Balance Sheets and Annual Returns.
In this Respect Ministry of Corporate Affairs had also issued one Notification no. 03/73/2017/CL-II on dated for Addition of names of the newly appointed Directors in the MCA database 18

23. Removal of Disqualification
MCA Advisory
Relaxation from Court
Also its important for the Directors removed / suspended like this to file a writ Petition / PIL against the action of Ministry / ROC with Hon’ble High Court or Hon’ble Supreme Court of India.
The First Stay from the Hon’ble Delhi High Court In re Sushen Gupta & Ors Vs Union of India had paved the way for such relaxations and thereafter around 100+ such stay applications were admitted by the Hon’ble High Court of Delhi.
Removal of Disqualification
The Ministry of Corporate Affairs state that the Directors disqualified under Section 164(2)(a) of the Companies Act, 2013 and who are associated with struck off companies (S.248) are advised not to make any application for Name Availability (INC-1), Incorporation of Companies (INC-7/ SPICe-INC-32 / URC-1 / INC-12).
. Forms filed by such Directors shall be rejected summarily by the Central Registration Centre (CRC)
Further, attention is drawn to the provisions of Section 7(5) and 7(6) which, inter-alia, provides that furnishing of any false or incorrect particulars of any information or suppression of any material information shall attract punishment for fraud under Section 447.
Attention is also drawn to the provisions of Section 448 and 449 which provide for punishment for false statement and punishment for false evidence respectively. 18

24. Definition

25. DEFINITIONS VANISHING COMPANIES Non-Banking Financial Company (NBFC)
Vanishing companies are companies which raise funds from public through Initial Public Offers (IPOs) and
afterwards fail to satisfy the listing/ filing requirements of the Registrar of Companies (ROC) and the Stock Exchanges for a continuous period of two (2) years or more and are not found at their registered office address at the time of inspection which is done by authorities / Stock Exchange.
ESSENTIALS OF VANISHING COMPANIES
• Failed to file company’s return with the Registrar of Companies (ROC) or with the Stock Exchange for a
continuous period of two (2) years or more.
• It is not being maintained at its registered office whose address has been notified with the Registrar of Companies/ Stock Exchange.
• None of its Directors are detectable.
Non-Banking Financial Company (NBFC)
A company which is engaged in the business of loans and advances, acquisition of shares/stocks/bonds/debentures/securities issued by Government or local authority or other marketable securities. Registration from RBI is required to open an NBFC.
Housing Finance Company (HFC)
Companies carrying business of financing, acquisition or construction of houses, including acquisition or development of land in connection therewith. 18

26. DEFINITIONS 19 Insurance Company Asset Management Company
A company that offers insurance policies to the public, either by selling directly to an individual or through
another source. An insurance company can specialize in one type of insurance, such as life insurance, health insurance, or offer multiple types of insurance.
Asset Management Company
Company that invest its clients pooled funds in securities. It provides investors with more diversification and
investing options.
Listed Company
Company whose shares are listed and traded on recognised stock exchange.
Collective Management Scheme
It’s an investment scheme wherein several individuals come together to pool their money for investing in a particular asset(s) and for sharing the returns arising from that investment as per the agreement between them
Capital Market Intermediaries
Stock Broker-who buys and sells securities on a stock exchange on behalf of clients.
Merchant Banker- Acts as an intermediary between the lender /investor and the borrower/investee. Underwriter- Underwrites or buys the shares to complete the agreed % of shares with the company. 19

27. DEFINITIONS
INDEMNITY BOND Bond executed to reimburse the holder for any loss occurred
AFFIDAVIT
A written statement confirmed by oath for use as evidence in court
SPECIAL RESOLUTION
Resolution passed by a majority of not less than two-third of total no. of votes caste by
all the shareholders
STATEMENT OF ACCOUNTS
Accounts containing assets and liabilities of a company
STATEMENT OF PENDING
LITIGATION
Any suit filed by or against the company but remain unresolved
SECTION 447
Any person found guilty of fraud, shall be punishable with imprisonment for a term which shall not be less than six months but which may extend to ten years and shall also be liable to fine which shall not be less than the amount involved in the fraud but which may extend to 3 times the amount involved in the fraud 20

28. Advocates, Company Secretaries & Insolvency Professionals
Thank You
CS A. K. Kuchhal
C -154, Sector 51 Noida,
Ph.: 0120 – ,
Mob.:
Advocates, Company Secretaries & Insolvency Professionals