0%
Loading ...
Strike off refers to a process in which ROC removes the Company’s name from the register of companies. Unfortunately, Section 8 companies does not have a liberty to opt for voluntary striking off..
10+ Years of Experience
10+ Years of Experience
400 + In-House CAs, CS & Lawyers
10,000+ Pin codes Network in India
Happy Customers
Expert Advisors
Branch Offices
Among Asia Top 100
Consulting Firm
Lowest Fees
100,000 + Clients.
4.9 Customer Rating,
50+ Offices
Section 8 companies is established to promote art, commerce, sports, science, education, social welfare, charity, religion, protection of natural resources, or any such other object. Such companies are obligated to allocate their profit to serve the said objects only. The concept of dividend distribution among members does not work in Section 8 “Company”. The overall business affairs of section 8 companies revolve around charitable goals. Section 8 companies fall under the Companies Act, 2013, and it is identical to trust and society. Section 8 company is ideal for promoters seeking to serve charitable intentions. Such companies cannot use a term like private limited or public limited in their name as it is prohibited under the governing Act.
Unlike other registered companies, a Section 8 entity does not have a straightforward procedure for shutting down their business operations. To serve this objective, first, they need to convert into a normal company and then surrender their license before the governing authority.The requirements have been cited under the governing legislation.
Conditions under which strike off route can be opted by the Section 8 Company
The section below discusses the common benefits of striking off section companies in India
Once registered, Section 8 company is liable to follow the ever-evolving compliances under the Companies Act, 2013 for its entire lifecycle. This may be a problem for a company lacking sound management for addressing such compliances. This is one of the prominent reasons why companies opt to strike off their existence.
A company that fails to comply with compliances on time typically ends up paying hefty penalties and fines. Some penalties are so severe that they restrain directors from serving another company. Being non-operational is another reason that could create such conditions for the company. Ideally, striking-off is the only solution to such a problem.
The cost of running a business that does not have an income is much higher than striking off the company. Therefore, striking off a section 8 company that does not have any activities or is dormant is a viable option for it.
As mentioned earlier, Section 8 companies do not have a standard procedure to close their business affairs. Strike off section 8 companies only come to an effect after the following the given procedure
Company conversion is the first step in the strike off procedure. To serve this purpose, the applicant firm needs to submit a prescribed application with the Ministry of Corporate Affairs along with the Documents mentioned above.
Upon receiving the application and Documents, the said authority shall make some legal checks against the rules mentioned under the governing legislation.
If the authority does not find any errors or discrepancies during the verification, they will grant their approval for conversion to the applicant firm.
In this step, the applicant can address the formalities for striking off the company name. For this, they are required to file the prescribed application with the Ministry of Corporate Affairs along with standard paper works and standard fees.
Approval for Strike off shall be granted by the authority after making in-depth verification of the submitted application and supported Documents.
Canjain is a tech-savvy business agency. It aids in end-to-end compliance, incorporation, management consultancy and advisory services to clients domestic and abroad.
The process of Strike off of Section 8 Company is seamless and cost-effective at Canjain . We also facilitate strike off services to different entities, including OPC and LLP. Additionally, we render services relating to company annual filing and secretarial compliance at the best rate. You can connect with a Canjain compliance expert for a free consultation.
We make technical compliance certifications effortless and convenient.
Clients Worldwide
By 42842+ Customer
Industry Professionals
Guaranteed
+91-9996647888