Winding up of a Private Limited Company
A company winding up is required when the purpose for which company was formed is over or the company has become a defunct entity with NIL Assets and Liabilities. We shall extend our services to provide the required advisory and end to end support service to close the company.
There are various scenarios in which a company can be closed, however, in case the company is inactive, defunct, or when there is no purpose left for the company to remain in existence, it is easier to close them. As the company is a creation of law, it can be closed by procedures established by statute only. To close a company, which has been registered under the Companies Act, 2013 or any previous Companies Act, the application for closure has to be filed as per the procedure established under the law. As of now, there are two methods only.
For active company, or where there are assets or liabilities, file an application under Insolvency and Bankruptcy Code 2016 (IBC) before the National Company Law Tribunal (NCLT). Team setindiabiz is experienced to handle winding up petitions at all benches of NCLT
In case your company is inactive for past two years or company did not start its operations within one year of its incorporation and there is no liability as such, then the company can be closed by filing Form STK-2 with the government fee of Rs. 10,000/-
Which kind of Company can Be Closed with STK-2 Form
Companies not Commenced Operations
Under section 248(1)(a), only that company can be closed which could not commence its business operations within one year of its incorporation. In other words, there is absolutely no transaction in the company.
Inactive Since Past Two Years
Under section 248(1)(c), a company can be closed even when the company started its business but has been inoperative for the past two financial years.
There is Nil Assets or Liabilities
There is no assets or liabilities in the company. All bank A/c must be closed, and the financial statements must be certified by a Chartered Accountant.
No Litigation Pending
There should not be any litigation or tax assessment pending for the company with the state government or central government or their agencies.
Documents of Company
- All ITR and Returns Filed with ROC
- Board Resolution Authorising the Closure
- Affidavit from all the Directors
- Indemnity Bond from all the Directors
- Bank A/c Closure Proof
- Financial Statement with NIL Liabilities
Winding Up Company Process
- Take decision in the shareholders meeting To close a company with Form STK-2 a meeting of the shareholders of the company must be called in order to decide about the closure with at least 75% voting rights.
- Surrender of Registration & Licenses If the company had registered under GST or obtained licenses under any government department, the same need to be surrendered before an application for closure is filed by the company.
- Bank A/c Closure & Prepare Financial Statement The bank accounts of the company must be closed, and a certificate from the banker is needed. Prepare a financial statement with Nil Assets and Liabilities, A Practicing CA or Auditor shall certify it.
- Affidavit & Indemnity Bond of All Director All directors and shareholders have to swear an affidavit that all information and documents being filed is true and correct and an indemnity bond that if any liability comes up the directors shall pay in person.
- Filing of STK-2 Form Check that the company has filed all pending ITR & ROC Return to the ROC, the application for closure of the company filed online with a digital signature in Form STK-2 with the government fee of Rs. 10,000/-