Closing-a-Company-Right-After-Incorporation

Can We Apply for the Strike Off a Company Immediately After Incorporation? 

Introduction

One legal method of shutting down an inactive firm is to strike off the company after it has been incorporated. After starting a business, many entrepreneurs question if they can take a voluntary strike. However, there are particular guidelines set forth by the Ministry of Corporate Affairs (MCA) regarding the timing and procedure of submitting an application for a voluntary strike off of a company.

 

Summary

  • Strike off is a legal closure procedure under Section 248 of the Companies Act, 2013.
  • A company cannot apply for strike off immediately after incorporation.
  • MCA mandates at least one year of incorporation before filing for Voluntary Strike Off.
  • Companies that have never started business may apply after one year.
  • Strike off requires filing Form STK-2, board approval, and RoC verification.
  • Professional help ensures faster, error-free processing.

Can a Company Apply for Strike Off Immediately After Incorporation?

No, a company cannot apply for strike off after incorporation immediately. MCA rules require the company to exist for at least one year before filing for voluntary closure. During this period, the company must complete all initial statutory compliances, including:

  • Filing of Form INC-20A (Commencement of Business) if applicable.
  • Submission of the first Annual Return and financial statements, if required.
  • Ensuring there are no pending liabilities, dues, or obligations toward creditors.

Only after these conditions are satisfied can the company apply for Voluntary Strike Off Company using Form STK-2. This ensures the closure is legally valid and compliant.

Understanding the Waiting Period Before Strike Off

While some business owners may wish to close their company immediately, MCA regulations require a minimum one-year period after incorporation before filing for strike off. This waiting period serves a practical purpose:

  • Establishing Company Identity: Time is needed to complete official records like DIN verification and registered office confirmation with RoC.
  • Documenting No Business Activity: Directors must submit a statement confirming no operations, bank accounts, or transactions.
  • Clearing Initial Obligations: Any statutory dues, taxes, or fees must be identified and settled before closure.
  • Ensuring Accurate Records for Stakeholders: RoC maintains reliable public records for creditors, investors, and government bodies.
  • Simplifying the Strike Off Process: A short operational history ensures Form STK-2 can be processed smoothly without MCA queries.

This approach shows that the waiting period is a practical compliance and verification step, not just a legal restriction.

Process of Strike Off After Incorporation

Once eligible, the process for voluntary strike off includes:

1. Board Resolution

  • Directors must approve closure via board resolution.
  • Authorizes a director to handle strike off filings and documentation.

2. Filing of STK-2 Form

  • Form STK-2 is submitted to MCA along with the prescribed fee.
  • Acts as the formal application for Voluntary Strike Off Company.

3. Attachment of Documents

  • Indemnity Bond signed by directors (Form STK-3)
  • Affidavit from directors (Form STK-4)
  • Statement of Accounts certified by a Chartered Accountant (Form STK-8)
  • Board resolution and shareholders’ special resolution
  • Consent/NOC from creditors, if applicable

4. Public Notice by MCA

  • MCA publishes a notice in the official Gazette inviting objections from the public.
  • Notice period is typically 30 days.

5. Final Strike Off

  • If no objections are received, the company’s name is removed from RoC records.
  • The company ceases to exist as a legal entity.

Conclusion

In India, strike off company after incorporation cannot be done immediately. Companies must comply with MCA rules, clear any liabilities, and wait at least one year before filing for voluntary closure. Following the correct Voluntary Strike Off Company process ensures smooth and legally compliant closure. EbizFiling assists businesses in preparing documents, filing STK-2, and completing the process efficiently.

Suggested Read :

Can an LLP Apply for Strike Off Immediately After Incorporation?

When Can You File STK-2 to Close a Company?

What is Winding Up & How Does Strike-Off Work?

Strike Off an OPC: Process, Benefits & Requirements

Difference Between Dormant and Strike-Off Companies

FAQs

1. Can I strike off my company right after incorporation?

No, MCA does not allow immediate strike off. You must first file Form INC-20A (commencement of business) and complete initial compliances before applying.

2. Why is strike off not allowed immediately after registration?

Because the company is considered “active” until commencement filing is done. Without that, ROC rejects closure applications to ensure compliance history exists.

3. What is the minimum time after incorporation to apply for strike off?

Practically, strike off can only be applied after the first financial year. This allows at least one set of annual filings before closure.

4. What if the company has not started any business at all?

Even if no business is done, ROC requires mandatory filings. Only then you can apply for voluntary strike off under Form STK-2.

5. Can I avoid compliance if I want immediate closure?

No, skipping compliances will lead to penalties and rejection of application. ROC verifies filings before striking off the company name.

6. Is there any penalty for early closure?

Yes, if you try to close without mandatory filings, directors may face fines for non-compliance. Proper closure avoids future legal risks.

7. Which form is required for closure of a newly incorporated company?

You must file Form STK-2 with attachments like affidavit, indemnity bond, and statement of accounts. This applies even for a new company.

8. Can ROC itself strike off my new company automatically?

Yes, if you do not file commencement or annual returns, ROC may strike off suo moto. But this is treated as non-compliance, not voluntary closure.

9. What if my company has no bank account or transactions?

Still, closure requires compliance. A nil financial statement must be attached with STK-2 to prove no business activity.

10. Why should I hire experts for immediate strike off queries?

Because rules are strict and mistakes lead to penalties. Professionals like EbizFiling ensure proper guidance for legal closure of even newly formed companies.

About Ebizfiling -

EbizFiling is a concept that emerged with the progressive and intellectual mindset of like-minded people. It aims at delivering the end-to-end corporate legal services 0f incorporation, compliance, advisory, and management consultancy services to clients in India and abroad in all the best possible ways.
 
To know more about our services and for a free consultation, get in touch with our team on  info@ebizfiling.com or call 9643203209.
 
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Author: dhruvi

Dhruvi Darji is a Content Writer at Ebizfiling who turned her passion for writing into a full-time career. She holds a Bachelor's degree in Computer Applications from KSV University and has been writing content professionally since 2023. Over time, she has worked on various topics and enjoys creating simple, clear, and helpful content that helps people gain a better understanding. She also holds a 7-band IELTS score, reflecting her strong grasp of language and communication. Beyond work, Dhruvi enjoys journaling and crafting stories.

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