Company Wind-Down Checklist

CA review

Wind-down is irreversible. STK-2 can be revoked within 20 years for fraud. IBC s.59 voluntary liquidation has strict timelines and IBBI oversight. This tool provides a checklist framework. A CA and CS (Company Secretary) must be involved for both routes. Do not file STK-2 or IBC proceedings without professional advice — missed obligations create personal director liability.

Does the company have any of the following?

Two primary routes for closing an Indian private limited company: (1) STK-2 Strike-off (fast track) — for dormant/inactive companies; (2) Voluntary Liquidation under IBC s.59 — for solvent companies with assets and liabilities.
STK-2 Strike-off (Fast Track) recommended

STK-2 route

  1. 1. Hold board meeting: pass board resolution for strike-off; appoint Authorized Representative
  2. 2. Clear all pending filings: ITR, GST returns (GSTR-10 final return), TDS returns, PF/ESIC
  3. 3. Close bank accounts and obtain no-objection from bank
  4. 4. Prepare Indemnity Bond (by directors with personal liability undertaking)
  5. 5. Prepare Statement of Accounts (certified by CA, not older than 30 days from Form STK-2 filing date)
  6. 6. File Form STK-2 on MCA21 portal signed by majority of directors
  7. 7. ROC issues Form STK-7 (notice of strike-off in Official Gazette) — 30-day public notice period
  8. 8. If no objections: ROC strikes off the company name; dissolution effective from date of publication
Timeline: Typically 60-90 days from filing to dissolution (excluding time for clearing pending filings)
Cost: Government fee for Form STK-2 is ₹10,000
GSTR-10 (Final Return): Must be filed within 3 months of GST cancellation or order of cancellation, whichever is earlier
CA review

Whether GSTR-10 must be filed before or after STK-2 — GST registration must be surrendered and GSTR-10 filed before the company can properly wind down all liabilities. Confirm sequence with CA.

Liquidator (or director in case of strike-off) must notify the AO within 30 days; cannot distribute assets without clearance from IT department that all dues are paid or adequately secured
CA review

s.178 ITA 1961 is framed for companies in liquidation/winding up — its direct application to administrative strike-off under s.248 is doubtful. For STK-2, the practical step is intimating the AO and clearing pending tax proceedings; confirm the current AO/NOC practice before relying on this.

CA review

Directors remain personally liable even after strike-off for any liability that existed before dissolution. Strike-off can be revoked within 20 years by ROC or court if obtained by fraud or if company had undisclosed assets.

Pre-wind-down checklist

ItemSTK-2IBC
GST File pending GST returns, surrender GST registration, file GSTR-10 final return Same; Liquidator files GSTR-10 after asset realisation
Income Tax File all pending ITRs up to dissolution date; pay all outstanding demand; obtain tax clearance Liquidator responsible; notify AO within 30 days; obtain s.178 clearance before distribution
TDS File pending TDS returns; deposit pending TDS; obtain TDS clearance Liquidator files and deposits all TDS during proceedings
PF/ESIC Pay all outstanding PF/ESIC employer + employee dues; deregister from EPFO/ESIC Employee dues paid under waterfall priority (before unsecured creditors)
ROC Filings All annual returns, AOC-4, MGT-7A current before filing STK-2 Liquidator manages ongoing ROC filings during proceedings
Bank Accounts Close all bank accounts; obtain bank NOC before filing STK-2 Liquidator manages during proceedings; closes after distribution
Trademarks/Patents/IP Transfer or abandon any registered IP before dissolution — cannot be surrendered after strike-off Realised as assets by liquidator
Common Mistakes to Avoid
Filing STK-2 with pending GST/IT dues

ROC can reject or revoke strike-off; directors face personal liability; future director appointments may be blocked under s.164(2)

Using STK-2 when company has creditors

Strike-off does not discharge creditors' rights. Creditors can apply to NCLT for restoration of the company name and pursue claims. Directors remain personally liable.

Not filing GSTR-10 final return

Late GSTR-10 attracts penalty ₹200/day (₹100 CGST + ₹100 SGST) up to ₹10,000. Blocks GST registration closure.

Distributing assets to shareholders before IT clearance

s.178 violation; IT department can hold directors personally liable for undistributed tax claims if assets were prematurely distributed

Statutory basis: Companies Act 2013 ss.248-252 (STK-2 strike-off); Insolvency and Bankruptcy Code 2016 s.59 (voluntary liquidation of solvent companies); IBC CIRP Regulations 2017; GST Act s.45 + Rule 20 CGST Rules (final GST return); PF/ESIC Act; Income Tax s.178 (special provisions for companies in liquidation)

Common questions

Closing a company, statute-cited.

What is the difference between STK-2 strike-off and s.59 voluntary liquidation?+

Strike-off (Form STK-2) under s.248(1)(e) of the Companies Act 2013 read with Rule 37 of the Companies (Incorporation) Rules 2014 is for a company with no assets, liabilities or commercial operations for two years — the Registrar removes the name from the register. Voluntary liquidation under s.59 of the IBC 2016 is a formal solvent winding-up with a liquidator, for a company that can pay its debts in full. The checklist helps you pick the right route.

What is the fee for an STK-2 strike-off application?+

The government fee for filing Form STK-2 is prescribed under Rule 12(1) of the Companies (Registration Offices and Fees) Rules 2014 — ₹10,000 at present; the MCA portal shows the current figure. There are also professional fees for preparing the application, indemnity bond and affidavits — discuss with us for a quote.

Can a struck-off company be restored?+

Yes — s.252(1) of the Companies Act 2013 lets the tribunal restore a struck-off company's name to the register on application, within 20 years of striking off, where it is just to do so (for example, the company held assets or was still operating). Restoration requires an application to the NCLT and payment of any outstanding filing fees.

What must be closed before GST registration is cancelled?+

Before closure, all GST returns must be filed and tax paid, and the final return in Form GSTR-10 must be filed within 3 months of cancellation (or the date of the cancellation order, whichever is later) under s.29 read with s.45 of the CGST Act 2017. Cancelling GST is a prerequisite for a clean strike-off or liquidation, and the checklist sequences these filings.

What happens to unpaid statutory liabilities after strike-off?+

Striking off does not extinguish liability — the company and its directors remain liable for unpaid taxes, TDS, GST, PF and any debts, and the income-tax and GST departments can still recover them after the name is removed. That is why the checklist insists on clearing returns and dues before you file STK-2 or begin liquidation.