How can a company be struck off the register or declared dormant?

Question

My company has stopped operations and I want to know whether to apply for strike off or dormant status to avoid ongoing compliance. I have been reading conflicting things online and I would like to understand what Indian law actually says about this, which Act and Section applies, what the realistic timelines and costs are, and what I should be doing right now to protect my position. If the matter can be resolved without litigation I would prefer that route, but I want to know what my rights are before I agree to anything or sign any document.

MyVakeel Legal Desk · Accepted Answer

How can a company be struck off the register or declared dormant? is governed in India primarily by Companies Act 2013, Section 248, Companies Act 2013, Section 455 and Companies Act 2013, Section 250. The short answer is set out below, followed by the practical steps most people in this situation need to take. Read it alongside the specific provisions named, because the exact relief available to you turns on the facts you can prove on paper.

Section 248 allows the Registrar to strike off a company that has failed to commence business within one year of incorporation or has not carried on business for two immediately preceding financial years and has not applied for dormant status.

A company can voluntarily apply for strike off using Form STK-2 after extinguishing all liabilities and obtaining a special resolution or consent of 75 percent of members in terms of paid-up capital.

Section 455 permits a company formed for a future project or holding assets without significant accounting transactions to apply for dormant company status through Form MSC-1, reducing certain compliance obligations.

Once struck off, a company under Section 250 ceases to operate except for the purpose of realising amounts due and discharging liabilities, and its name is removed from the register.

Directors of a struck-off company can still be held liable for outstanding dues, and the Registrar or Tribunal can restore a struck-off company on application within the prescribed time if strike off was improper.

What to do next: 1) Clear all liabilities and close bank accounts before applying for strike off; 2) File Form STK-2 with the required affidavits and indemnity bonds; 3) Consider dormant status through Form MSC-1 if the company may resume activity later; 4) Retain records to respond to any restoration or liability claims after strike off.

If the other side has already issued a notice, filed a case or set a deadline, treat the matter as time-sensitive — most remedies under Companies Act 2013, Section 248 carry limitation periods, and a delay you cannot explain weakens an otherwise strong case. You can post the details on the MyVakeel forum for a practising advocate to review, or book a paid consultation with a Bar Council verified lawyer in this practice area.