Strike off of the name of one person company

What is Strike Off?

Striking off is a voluntary legal process by which a company, including an OPC, applies to the Registrar of Companies (ROC), now centrally handled by C-PACE, for the removal of its name from the Register of Companies when it has ceased to carry on business or is no longer in operation.

Once approved, the company is dissolved and legally ceases to exist.

Governing Provisions

• Section 248(2) of the Companies Act, 2013
• Rule 4 of the Companies (Removal of Name of Companies from the Register of Companies) Rules, 2016
• MCA Notifications and relevant Circulars from time to time

Key Exemptions for OPCs (Especially Where There is Sole Director Cum Member)

The Companies Act, 2013 recognizes the unique nature of OPCs and provides certain procedural relaxations during the strike-off process:

• No Need to Hold General Meeting: OPC is not required to hold a general meeting or pass a special resolution for strike-off since it has only one member.
• Simplified Board Resolution: A board resolution signed by the sole director cum member is sufficient for initiating the strike-off process.
• No Newspaper Publication Required: OPCs are not required to publish any strike-off notice in newspapers.
• No Requirement to File STK-6 (Notice of Proposed Strike-Off to Stakeholders): STK-6 is generally used by the ROC suo moto (under Section 248(1)) to issue notice to the company and stakeholders. However, in case of voluntary strike-off under Section 248(2), Form STK-6 is not applicable to OPCs.
• No Requirement for Auditor’s Certificate: Unlike companies that may need an auditor’s certificate for certain closures or compliance filings, in OPCs, certification from a Chartered Accountant (in practice) is sufficient for statement of accounts in STK-8 and declarations relating to no dues, no loans, and no business activities. This provides flexibility to OPCs that may not have appointed an auditor in the past year.
• No Minimum Time Frame for Operation (If Voluntary): While many assume a company must be inoperative for at least two years before applying for strike-off, under Section 248(2) (voluntary application), there is no such minimum period—the company may voluntarily apply for strike-off any time after incorporation, provided it has no liabilities and has not commenced business (especially if it hasn’t filed any significant returns or statements).
• No Requirement for Filing Annual Returns if Not Commenced Business: If the OPC has never commenced business or never opened a bank account (a common scenario for dormant OPCs), and therefore has not filed MGT-7 or AOC-4, it may still apply for strike-off, provided the company is in good standing otherwise and can justify non-compliance with supporting declarations.

Disclaimer: As per the Companies Act, there is no express exemption from filing annual returns before applying for strike-off. However, in genuine cases of complete inactivity, strike-off may be permitted by C-PACE on a case-by-case basis with appropriate supporting documents and justification. This is not a legal right but an administrative concession.

Simplified Signing Requirements

Since the OPC has only one director-cum-member, signing of forms and documents (such as STK-2, STK-3, STK-4) is less cumbersome—no need for digital signatures of multiple directors, shareholders, or KMPs.

Centralized Strike-Off Processing by C-PACE

Since 1st May 2023, the Centre for Processing Accelerated Corporate Exit (C-PACE) has been operationalized by MCA as a centralized body to process all strike-off applications under Section 248(2).

Key Features:

• Centralized, faster processing
• Uniform scrutiny and approvals
• Increased transparency and consistency

Regardless of the company's registered ROC, all STK-2 applications are now processed by C-PACE, enhancing ease of exit for dormant companies.

Procedure of striking off of the name of the company by way of an application to ROC:

STEP-1: Internal Approvals

• Call and hold Board Meeting to pass Board resolution for the purpose of striking off of the name of the company.
• After passing of Board resolution, if there is any liability in the company, the company will set off/pay all its liabilities.

STEP-2: Obtain Consents

Obtain NOC cum consent from the Nominee and the sole member of the OPC.

STEP-3: Prepare and Execute Key Documents

• Indemnity Bond (Form STK-3): To be executed and notarized by the sole director.
• Affidavit (Form STK-4): By the director with KYC documents.
• Statement of Accounts (Form STK-8): Must not be older than 30 days from the date of filing and certified by a Chartered Accountant.

STEP-4: Filing with ROC

An application for removal of the name of the company shall be made in eForm STK-2 on the MCA Portal along with the fee of ten thousand rupees.

STEP-5: Review by ROC

The Registrar will review the application and attached documents. If everything is in order, the Registrar will issue a notice and publish it on the MCA website and in the Official Gazette.

STEP-6: Final Strike-Off Order

If no objections are received within 30 days of publication, the ROC will strike off the company’s name from the register and issue a notice confirming the dissolution of the OPC in Form STK-7.

Forms to be filed with ROC:

• E-Form STK-2 (Fees for filing is ₹10,000)

Attachments in E-Form STK-2:

• Certified Copy of Board Resolution
• NOC cum consent from sole member
• NOC cum consent from nominee
• Notarized Indemnity Bond (Form STK-3)
• Affidavit (Form STK-4) along with KYC of director
• CA-certified declaration of no secured/unsecured loan
• CA-certified declaration of no business operations
• CA-certified declaration of no statutory dues
• Statement of Accounts (Form STK-8)
• Bank account closure letter, or declaration of not having a bank account

Important Notes:

• Ensure no pending litigations or regulatory proceedings exist before applying.
• The company must not have changed its name or shifted its registered office in the last 3 months.
• STK-2 cannot be filed if the company has pending annual filings or is listed, under inspection/investigation, or has been delisted/deregistered for non-compliance.
• Exemptions apply only where there is no liability, no pending litigation, no secured loans, and no ongoing regulatory actions.
• Any non-filing of returns must be justifiable and not misleading. ROC scrutiny varies from case to case.
• In case of foreign ownership or investments, additional FEMA compliance checks may apply even for OPCs.

Disclaimer: The contents of this article are for general informational purposes only and do not constitute legal or professional advice. While every effort has been made to ensure accuracy, readers are advised to consult with a qualified professional or refer to the latest provisions under the Companies Act, 2013 and relevant MCA guidelines before acting on any information provided herein.