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A private limited company that is no longer operating does not automatically disappear from the records of the Ministry of Corporate Affairs. Even when a business has stopped trading, the company may continue to have statutory obligations until its name is formally removed from the Register of Companies. Closing a private limited company in India is therefore an important legal and compliance step — not something that happens on its own.
Quick Answer: An eligible private limited company can generally apply for voluntary strike off under Section 248(2) of the Companies Act, 2013, using Form STK-2, by:
- Confirming that the company qualifies for strike off
- Clearing liabilities and resolving outstanding obligations
- Completing applicable pending ROC filings
- Obtaining the required shareholder approval
- Preparing the prescribed indemnity bond, affidavit and statement of accounts
- Filing Form STK-2 with the required certification and attachments
- Responding to any MCA/C-PACE clarification, if raised
- Waiting for the statutory notice and processing, then receiving the final dissolution notice
The application is now processed through the Centre for Processing Accelerated Corporate Exit (C-PACE) under the MCA system.
On this page
- What Is Company Strike Off?
- Who Can Apply for Strike Off?
- Companies Excluded From This Route
- Before You File STK-2
- Documents Required
- Step-by-Step Process (12 Steps)
- Timeline & Cost
- Tax, Loans, Litigation & Employees
- After Strike Off: Directors, Assets & Restoration
- Strike Off vs Dormant vs Winding Up
- If MCA Rejects the Application
- Practical Checklist
- FAQs
What Is Company Strike Off in India?
Company strike off is the legal process through which a company’s name is removed from the Register of Companies. When the Registrar completes the process under Section 248 and publishes the required notice, the company stands dissolved from the date specified in the notice — though certain liabilities and obligations can continue despite dissolution. Strike off is not the same as simply stopping business operations — stopping sales, closing the office or becoming inactive does not by itself legally close the company. A proper closure requires compliance with the applicable Companies Act procedure.
The primary legal framework includes Section 248 (removal of name), Section 249 (restrictions on applying), Section 250 (effect of dissolution), Section 251 (fraudulent applications) and Section 252 (restoration), supported by the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 and subsequent amendments.
Who Can Close a Private Limited Company Through Strike Off?
Never Commenced Business
A company that has failed to commence business within one year of incorporation can fall within the strike off framework, subject to the other legal conditions.
Stopped Business Operations
A company that has not carried on business or operations for the two immediately preceding financial years, and has not applied during that period for dormant status under Section 455, can also qualify.
Can an “Active” company be closed? Yes — MCA marking a company “Active” doesn’t automatically prevent voluntary strike off. The real question is whether it satisfies the statutory conditions and procedural requirements for Section 248(2). Review the company before filing STK-2 rather than assuming an inactive business automatically qualifies.
Companies That Cannot Use the Normal Strike Off Route
| Category | Strike Off Issue |
|---|---|
| Listed companies | Excluded from this strike off route |
| Certain delisted companies | Excluded where delisting occurred for specified non-compliance reasons |
| Vanishing companies | Excluded |
| Companies under inspection/investigation | Excluded while relevant proceedings remain within prohibited conditions |
| Companies facing specified prosecution | Excluded |
| Companies with pending compounding applications | Excluded |
| Outstanding public deposits or repayment defaults | Excluded |
| Charges pending for satisfaction | Excluded |
| Section 8 companies | Excluded from voluntary removal under this route |
A company regulated by a sector-specific law (NBFCs, housing finance, insurance, capital market intermediaries, collective investment schemes, asset management companies, among others) may also need a no-objection certificate or approval from the relevant regulator before applying.
Section 249 restrictions: A company should not apply where, during the previous three months, it has changed its name or shifted its registered office between States, disposed of property or rights in circumstances prohibited by Section 249, conducted activities other than closing its affairs or complying with statutory requirements, made a pending application to the Tribunal for a compromise/arrangement, or entered winding up proceedings under Chapter XX. This is one reason company closure should be planned before important corporate changes are made.
What Must Be Done Before Filing STK-2?
One of the biggest mistakes founders make is assuming STK-2 is the first step — in reality, preparation comes before the form. The company should review ROC filings, tax dues, GST obligations, employee-related statutory dues, loans and creditors, outstanding charges, bank accounts, litigation, assets, shareholder approval and director declarations. The STK-2 declaration itself requires the applicant to confirm that the company has no outstanding secured or unsecured loans, no specified outstanding tax or statutory dues, and that its liabilities have been settled, discharged or extinguished.
Pending ROC Compliance Is a Major Blocker
Under the 2023 amendment to the strike off rules, a company generally cannot file STK-2 unless it has filed overdue financial statements and annual returns up to the end of the financial year in which it ceased business operations. If the Registrar has already initiated action under Section 248(1), additional filing conditions apply, and once a Section 248(5) notice has been issued for publication, the voluntary STK-2 route is no longer available. Don’t assume years of unfiled ROC returns can simply be ignored — determine which years must be regularised first. See our guide on Private Limited Company annual compliance cost to understand what regularising overdue filings typically involves.
Not Sure If Your Company Qualifies for Strike Off?
Years of pending filings, outstanding charges, or an unclear cessation date can all block an STK-2 application. Get your MCA status reviewed first.
What Is Form STK-2, and What Documents Are Required?
Form STK-2 is the application used for voluntary removal of a company’s name under Section 248(2). MCA’s current instruction kit states the form is used for closure and is filed with C-PACE, with system checks covering company status, digital signature, outstanding charges, pending forms and other application conditions.
1
Indemnity Bond — Form STK-3
Every director must provide the prescribed indemnity bond, which the rules require to be duly notarised.
2
Affidavit — Form STK-4
Every director must provide the required affidavit as part of the prescribed documentation.
3
Statement of Accounts — Form STK-8
Must show the company’s assets and liabilities, made up to a date not more than 30 days before the application date, and certified by a practising Chartered Accountant.
4
Shareholder Approval
Via a special resolution, or consent of members holding at least 75% of paid-up share capital, as permitted by Section 248 and the rules.
5
Board Resolution
A director duly authorised by the Board signs and files the application, as required by the STK-2 rules.
6
Litigation Statement
The application must include a statement regarding pending litigation involving the company, if any.
7
Regulatory Approval, Where Applicable
Companies regulated under special laws may need a no-objection certificate from the relevant regulator before filing.
Is MGT-14 required? Where the special resolution route is used, the current STK-2 system requires the related MGT-14 SRN to be entered and valid, associated with the company’s CIN, with the MGT-14 filing purpose corresponding to the application for removal of name. The alternative shareholder-consent route is separately recognised. Because requirements depend on the exact route and the company’s filing position, check the company’s resolutions and MCA records before submission.
Step-by-Step Process to Close a Private Limited Company in India
- Review the Company’s StatusCheck MCA master data — company status, directors, registered office, outstanding charges, pending forms, strike off notices, litigation indicators and compliance defaults.
- Determine the Date of Cessation of BusinessImportant because overdue filing requirements connect to the financial year in which operations actually ceased.
- Clear LiabilitiesVendor dues, employee dues, loans, tax dues, GST obligations, government dues and other outstanding obligations — Section 248 requires liabilities to be extinguished before applying.
- Review and Complete Applicable ROC FilingsFile pending financial statements and annual returns up to the relevant cessation year.
- Deal With Bank Accounts and AssetsThe company should not retain undisclosed assets or operating funds — remaining balances and assets must be dealt with appropriately.
- Pass the Board ResolutionApprove the proposal to apply for removal and authorise a director to take the required steps.
- Obtain Member ApprovalSpecial resolution, or consent from members representing at least 75% of paid-up share capital.
- Prepare STK-3, STK-4 and STK-8Indemnity bond, affidavit and statement of accounts — the latter meeting the 30-day requirement.
- File STK-2 Through the MCA SystemProcessed through C-PACE (introduced on MCA V3 in 2023).
- Respond to Any ClarificationThe application may undergo scrutiny — provide further information or correct the filing if MCA/C-PACE raises an issue.
- Public Notice and ProcessingA public notice in Form STK-6 is issued, giving interested persons an opportunity to object.
- Final Strike Off and DissolutionOnce the process completes with no valid contrary cause, the company’s name is removed and dissolution is confirmed in Form STK-7.
How Long Does It Take, and How Much Does It Cost?
There is no universal fixed number of days that guarantees completion — overall time depends on pending compliance, quality of the application, document completeness, MCA/C-PACE scrutiny, clarifications, regulatory issues and the public notice process, which includes a 30-day objection period. Think in terms of a multi-stage process that can take several months rather than expecting immediate closure.
Standard Government Fee
The current standard fee prescribed under the strike off rules for Form STK-2 is ₹10,000. The total closure cost is typically higher once ROC additional fees, professional fees, CA certification, notarisation and other corrective filings are included.
2026 Fee Concession Has Ended
MCA’s Companies Compliance Facilitation Scheme, 2026 offered a temporary reduced STK-2 rate and relief on certain additional filing fees. That concession window closed on 15 September 2026. As of today, don’t assume the temporary discount is still available unless MCA announces a fresh scheme.
Tax, Loans, Litigation and Employees Before Closure
GST and Tax Dues
Strike off and GST cancellation are related but separate processes — review your GST position and complete the applicable cancellation process independently. The STK-2 declaration requires confirmation that specified tax and government dues have been dealt with. See our guides on GST return filing and what happens if you miss GST return filing if returns are pending.
Outstanding Loans
The STK-2 declaration specifically requires confirmation of no outstanding secured or unsecured loans. Unresolved secured obligations or open charges can create procedural barriers — the instruction kit specifically checks for unsatisfied charges.
Litigation
The application requires disclosure of pending litigation involving the company or its directors. Certain prosecution and other proceedings can make a company ineligible under the rules — don’t assume disclosure alone makes the company eligible.
Employees
Review salary settlement, full-and-final settlement, statutory contributions, TDS obligations, PF/ESI matters and any pending labour claims — these don’t disappear simply because commercial activity stops.
Outstanding Loans, GST Dues or Pending Litigation?
These are the most common reasons an STK-2 application gets stuck or rejected. Get them reviewed and resolved before you file, not after.
What Happens After Strike Off?
Once the name is removed under Section 248 and the required notice is published, the company is dissolved. Under Section 250, it ceases to operate as a company from the date specified in the notice, and its Certificate of Incorporation is treated as cancelled — subject to statutory exceptions relating to realising amounts due and discharging liabilities.
Directors’ Liability Can Continue
Section 248 states that the liability of directors, managers, officers and members may continue and can be enforced as if the company had not been dissolved, for matters covered by law. Section 251 imposes fraud-related consequences if the application was made to evade liabilities or deceive creditors — “closing the company” is never a way to make liabilities disappear.
Assets Remain Available
Section 248 requires the Registrar to be satisfied that adequate provision has been made for realising amounts due to the company and discharging liabilities — assets remain available for this purpose even after removal.
Can a Struck Off Company Be Restored?
Yes. Under Section 252(1), a person aggrieved by the Registrar’s dissolution order can approach the Tribunal within three years from the date of the order, in the circumstances specified. Section 252(3) provides another route where a company, member, creditor or workman applies before the expiry of twenty years from publication in the Official Gazette, subject to statutory conditions. Restoration is not automatic — the Tribunal must be satisfied the statutory requirements are met.
Strike Off vs Dormant Status vs Winding Up
Strike Off vs Dormant Status
Not every inactive company should necessarily be closed. A dormant company under Section 455 remains registered, whereas strike off removes the company’s name and results in dissolution. The choice depends on future plans, compliance position, assets, liabilities and business strategy — a professional review can help determine the appropriate route.
Strike Off vs Winding Up
Strike off suits eligible companies meeting the statutory conditions, using Section 248 and Form STK-2, processed through C-PACE. Winding up or liquidation may be necessary where the company has assets, liabilities, creditor issues or circumstances that make strike off unsuitable. The correct route depends on the company’s actual financial and legal position.
Never started business, or inactive for years? A company that failed to commence business within one year, or one that changed plans before launching, may still use the strike off route — this applies to startups that never launched, companies incorporated for a cancelled project, or entities created for a venture that never proceeded. But “never did business” doesn’t mean no compliance work is required — MCA and tax records still need review. Similarly, a company inactive for three, five or more years should not assume it can file STK-2 immediately; it may first need to regularise overdue filings up to the relevant cessation year. The correct process always starts with a compliance health check.
What If MCA Rejects the STK-2 Application?
An application may face scrutiny or rejection where the company doesn’t meet applicable requirements — common problem areas include outstanding charges, pending filings, incorrect shareholder approval, unresolved liabilities, restricted company status, pending proceedings, incomplete documents, an incorrect statement of accounts, or inconsistencies between MCA records and the application. The STK-2 instruction kit contains numerous system checks intended to prevent filing where specified conditions aren’t satisfied — reviewing the company’s MCA record before preparing the form can save substantial time.
- Pending ROC ComplianceYears of unfiled returns may need regularisation before STK-2 can proceed.
- Outstanding ChargesOpen charges can prevent a clean strike off application.
- Incorrect Statement of AccountsSTK-8 has a specific date requirement and must be CA-certified.
- Wrong Shareholder ApprovalFollow the correct approval route and maintain supporting records.
- Tax or Government DuesUnresolved statutory obligations create problems with the required declarations.
- Ongoing LitigationPending proceedings must be disclosed and properly assessed.
- Incorrect Cessation DateAffects the compliance position and which overdue filings need to be considered.
- Application Filed Too EarlySection 249 restricts certain activities during the previous three months.
Application Already Facing Scrutiny or Delay?
Whether it’s an outstanding charge, an incorrect STK-8, or a Section 249 timing issue, the fix usually starts with a fresh review of the MCA record.
Why You Should Not Ignore an Inactive Private Limited Company
One of the most common mistakes founders make is simply stopping operations and forgetting about the company. An inactive company can continue to have compliance obligations until it’s properly dealt with — the longer it remains unresolved, the more complicated the records can become, involving pending ROC filings, additional fees, tax compliance, director-related compliance, outstanding registrations, old bank accounts, unresolved charges and MCA notices. The more efficiently a company is reviewed and closed through the correct legal route, the easier it is to bring the corporate record to a clean conclusion. For general small business obligations along the way, see our small business compliance checklist.
Practical Checklist Before Closing a Private Limited Company
- Company status checked on MCA
- Date of cessation of business identified
- ROC compliance reviewed
- Relevant overdue annual filings completed
- Government and tax dues reviewed
- GST position reviewed, where applicable
- TDS obligations reviewed
- Employee and statutory liabilities reviewed
- Loans and creditor claims settled
- Outstanding charges checked
- Assets reviewed
- Bank accounts reviewed and closure arranged
- Litigation reviewed
- Board resolution completed
- Shareholder approval completed
- STK-3, STK-4, STK-8 prepared
- Statement of accounts certified
- MGT-14 requirement checked, where applicable
- STK-2 prepared and submitted
- Clarifications monitored
- STK-6 notice monitored
- Final STK-7 notice monitored
Frequently Asked Questions About Closing a Private Limited Company in India
How do I close a private limited company in India?
An eligible company can generally apply for voluntary strike off under Section 248(2) by extinguishing its liabilities, obtaining the required member approval, preparing STK-3, STK-4 and STK-8, and filing Form STK-2 through the MCA system.
What is Form STK-2?
STK-2 is the prescribed application for voluntary removal of a company’s name from the Register of Companies under Section 248(2). The current MCA system routes STK-2 applications through C-PACE.
How much is the STK-2 government fee?
The standard fee prescribed under the strike off rules is ₹10,000.
Is the 2026 STK-2 discount still available?
The temporary CCFS 2026 concession ended on 15 September 2026. As of today, the temporary concession is no longer the applicable standard unless MCA announces fresh relief.
Can I close a company that never started business?
A company that failed to commence business within one year can fall within the statutory strike off grounds, subject to the remaining eligibility and compliance requirements.
Can I close a company that has been inactive for two years?
A company that has not carried on business or operations for two immediately preceding financial years and has not applied for dormant status can fall within the statutory strike off framework, subject to the applicable conditions.
Can I file STK-2 with pending annual returns?
The 2023 amendment to the rules generally requires overdue financial statements and annual returns to be filed up to the end of the financial year in which the company ceased business operations before STK-2 can be filed.
Is MGT-14 required for strike off?
Where the special resolution route is used, the current STK-2 system requires the relevant MGT-14 SRN information. The shareholder consent route is separately recognised in the framework.
What documents are required for company strike off?
The prescribed STK-2 package includes an STK-3 indemnity bond, STK-4 affidavit, STK-8 statement of accounts, shareholder approval, a litigation statement and other applicable supporting documents.
How old can the statement of accounts be?
The statement of accounts must be made up to a date not more than 30 days before the date of the application and certified by a Chartered Accountant.
Can a company with outstanding loans be struck off?
The STK-2 declaration requires confirmation that the company has no outstanding secured or unsecured loans. Outstanding charges and unresolved secured obligations can also create filing issues.
Can a company with tax dues be closed?
Strike off should not be used to avoid tax or statutory liabilities. The STK-2 declaration requires specified tax and government dues to have been dealt with and liabilities to have been settled or extinguished.
Can a company with litigation be closed?
The STK-2 application requires disclosure of pending litigation. Certain proceedings and prosecutions can also make a company ineligible under the strike off rules.
How long does company strike off take?
There is no universal guaranteed completion period. The process includes scrutiny, statutory notices and processing, and the overall time can vary depending on the company’s compliance and circumstances. The public notice process includes a 30-day objection period.
What happens after STK-2 is approved?
The Registrar processes the removal of the company’s name, publishes the applicable notice and, once the statutory conditions are completed, the company stands dissolved under Section 248.
Can a struck off company be restored?
Yes. Section 252 provides restoration mechanisms through the Tribunal in specified circumstances, including a three-year route under Section 252(1) and a separate twenty-year route under Section 252(3), subject to the statutory conditions.
Final Conclusion
If your business has stopped operating, formally closing the company can be an important part of completing the business lifecycle. For an eligible private limited company, voluntary strike off under Section 248(2) through Form STK-2 provides a structured route for removing the company’s name from the Register of Companies, processed through MCA’s C-PACE system. But it should never be treated as a one-form exercise — before filing, check eligibility, clear liabilities, address applicable ROC filings, review tax and statutory obligations, resolve outstanding charges, obtain the required member approval and prepare the prescribed documents.
Most importantly, strike off does not provide a legal shortcut for avoiding liabilities — Sections 248, 250 and 251 preserve important rights and liabilities even after dissolution, in the circumstances provided by law. For founders who want to close an inactive private limited company properly, the best starting point is a company closure compliance review.
Need to Close Your Private Limited Company?
Don’t simply stop filing returns and leave the company inactive — get the company’s compliance position reviewed first. Garuda Mudra can help review your MCA status, check pending compliance, identify closure requirements, prepare documentation, coordinate professional certification and manage the STK-2 process, for businesses across Delhi, Gurugram, Noida, Bengaluru, Mumbai, Hyderabad, Chennai, Pune, Ahmedabad, Kolkata and beyond.
This article is intended for general informational purposes for businesses in India and is not a substitute for professional legal, company secretarial or tax advice. Companies Act provisions, rules, forms, fees, deadlines and MCA notifications (including scheme concessions such as CCFS 2026) can change. Businesses should verify the current requirements applicable to their company with the MCA, C-PACE and a qualified professional before taking action.