Strike Off an One Person Company(OPC): Process, Benefits, & Requirements

What is the Process of Striking Off an OPC?

Here is step-by-step process to strike off an One Person Company (OPC) under Section 248 of the Companies Act, 2013;

Step 1: Hold a Board Meeting

The director of the OPC must conduct a board meeting to pass a resolution approving the decision to strike off the company. This resolution also authorizes the filing of Form STK-2.

Step 2: Close Bank Accounts and Settle Liabilities

Before applying for strike off, the company must close all its bank accounts and settle any pending liabilities or dues. A no-dues declaration should be prepared.

Step 3: Prepare the Necessary Documents

Collect and prepare all required documents, including the indemnity bond, affidavit, statement of accounts certified by a CA, and identity/address proof of the director.

Step 4: File Form STK-2 with the ROC

Submit the application for strike off in Form STK-2 to the Registrar of Companies along with the prescribed government fees and required documents.

Step 5: Verification 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: Strike Off and Dissolution

If no one raises objections 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.

What are the Benefits of Striking Off an OPC?

Striking off an OPC can offer several advantages, especially when the business is no longer active or viable. Here are some key benefits:

• Cost Savings: It helps avoid recurring costs related to compliance, audits, and annual filings.
• Simplified Closure: Compared to winding up, strike off is a quicker and less complicated way to close a company.
• No Legal Burden: Once struck off, the company is removed from MCA records, and directors are no longer responsible for regulatory filings or penalties.
• Clears Unused Business Identity: It formally closes the company, preventing misuse of its name, PAN, or registration details.
• Peace of Mind: Ensures that there are no future obligations or liabilities in the name of the dormant company.

Common Mistakes an OPC must avoid before Striking off an OPC

• Not Clearing Outstanding Liabilities: Submitting the application without settling debts, taxes, or dues can result in rejection.
• Filing with Incomplete or Incorrect Documents: Missing affidavits, improper statement of accounts, or unsigned forms are common errors.
• Non-filing of Annual Returns: If the company hasn’t filed its financial statements and annual returns, the ROC may reject the strike-off request.
• Skipping Bank Account Closure: Not closing the company’s bank account before applying can complicate the process.
• Applying During Legal Proceedings: If the company is under investigation, inspection, or legal dispute, it is not eligible for strike off.

Conclusion

Striking off an One Person Company (OPC) is a practical and efficient way to officially close a non-operational business. It helps reduce compliance burdens, avoid unnecessary penalties, and ensures legal closure under the Companies Act, 2013. By following the correct process and submitting accurate documents, business owners can achieve a stress-free strike off through the MCA.

Suggested Read :

OPC Turnover Limit

Legal Consequences of Strike Off OPC

What is winding up?

Process of LLP Strike Off

Differences between Dormant & Strike off Companies

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