Ch. 26 Strike Off and Restoration of Name of the Company and LLP: PYQ Decoder

December 2025Q. 6A(iii)5 marksSyllabus 2022

(iii)Marina Tech LLP was incorporated in 2019 by three partners, Mr. A, Ms. B, Mr C to provide technology consulting services.

By 2024, due to lack of business activity and sustained financial losses, the partners decided to discontinue operations.

Believing that the LLP had no outstanding liabilities, they opted for voluntary strike-off under Rule 37(1)(b) of the LLP Rules, 2009. They passed a resolution for strike-off, filed Form 24 with the Registrar of Companies (ROC), submitted affidavits declaring no pending liabilities, attached a CA-certified Statement of Accounts showing zero assets and dues, executed indemnity bonds agreeing to indemnify the ROC against future claims.

In March 2025, after public notice and no objections, Marina Tech LLP was officially struck off from the register. Two months later, a vendor, New IT Solutions, sent an email to all the designated partners claiming that payment of ₹ 9 lakhs for software licenses supplied in 2023 has not been made despite repeated reminders. The directors replied that the LLP is no more in existence and hence they are not liable to make the payment now. Eventually, New IT Solutions approached the NCLT for the same. The creditor presented email records, an invoice, and delivery conformations.

Comment in the light of provisions of The Limited Liability Partnership Act, 2008 read with rule 37 of the Limited Liability Partnership Rules, 2009 whether the designated partners are still liable to make payment to New IT Solutions ?

June 2025Q. 6A(iii)5 marksSyllabus 2022

(iii)Sujan Technologies Pvt. Ltd. faced serious allegations of financial mismanagement, excessive debts and non-compliance of statutory filings. The non-compliance issues led to an inspection and investigation being ordered by the Registrar of Companies (ROC). The inspection of the company by Registrar of Companies (ROC) was completed and investigation report was submitted. Severe irregularities relating to falsification of accounts was reported and hence prosecution under the Companies Act was initiated in the court of law against the directors. As the investigation of the Company is already complete, the Board of Directors of Sujan Technologies Pvt. Ltd filed an application for removal of name of the company from the Register of Companies (ROC). The company has not continued with any of its business or operation for a period of two immediately preceding financial years. The ROC rejected the application citing the provisions of Section 248 of the Companies Act, 2013.

Referring to the relevant provisions, discuss the tenability of the application filed with ROC for removal of name.

According to section 248(1) of the Companies Act,2013, where the Registrar has reasonable cause to believe that—

(c)a company is not carrying on any business or operation for a period of two immediately preceding financial years and has not made any application within such period for obtaining the status of a dormant company under section 455 he shall send a notice to the company and all the Directors of the company, of his intention to remove the name of the company from the register of companies and requesting them to send their representations along with copies of the relevant documents, if any, within a period of thirty days from the date of the notice.

Section 248(2) of the Act states that without prejudice to the provisions of sub-section (1), a company may, after extinguishing all its liabilities, by a special resolution or consent of seventy-five per cent. members in terms of paid-up share capital, file an application in the prescribed manner to the Registrar for removing the name of the company from the register of companies on all or any of the grounds specified in sub-section (1) and the Registrar shall, on receipt of such application, cause a public notice to be issued in the prescribed manner:

Rule 3 of the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 provides that the Registrar of Companies may remove the name of a company from the register of companies in terms of sub-section (1) of section 248 of the Act. The rule provides that following categories of companies shall not be removed from the register of companies under this rule and rule 4, namely-

(iv)Companies where inspection or investigation is ordered and being carried out or actions or such order is yet to be taken up or were complete but prosecutions arising out of such inspection or investigation is pending in the court;

(v)Companies against which any prosecution for an offence is pending in any court;

In the present case, while the inspection had been completed, the prosecution against the directors was still ongoing in the court at the time, the company applied for striking off its name.

Hence, Sujan Technologies Pvt. Ltd. has to wait till the final verdict in the court and the rejection by ROC is valid as the removal of name from the register could not be done under the law until the pending prosecution gets resolved.

Moreover, though the company has not continued with any of its business or operation for a period of two immediately preceding financial year but it has not applied for dormant status, therefore, pursuant to section 248(2), without prejudice to the provisions of sub-section (1), the company cannot file application for removal of name of company as for that company has to pay its all liabilities and then pass special resolution or needs consent of seventy-five per cent. members in terms of paid-up share capital for the same to the Registrar on the grounds specified in sub-section (1).

Therefore, the application of the company filed with RoC for removal of its name is not tenable pursuant to above provisions.

Source⁠‌‌‌‌⁠: ICSI Guideline Answers, June 2025, Q. 6A(iii) (Syllabus 2022).

December 2024Q. 6A(iii)5 marksSyllabus 2022

(iii)Sarwam Technologies Pvt. Ltd. is not carrying on any business or operation for a period of two immediately preceding financial years and has not made any application within such period for obtaining the status of a dormant company under Section 455 of the Companies Act, 2013. The Board of directors of Sarwam Technologies Pvt. Ltd. intend to file an application for removal of name of company from the Register of Companies (ROC). The Board of directors called a meeting of shareholders and 66% of the shareholders in terms of paid-up capital gave their consent to the proposal and thereafter the application was filed with ROC.

Discuss the tenability of the application filed with ROC for removal of name.

A company through its board of directors, can file an application for removal of name of company from the Register of Companies on the following grounds:

(a)Where a company has failed to commence its business within one year of its incorporation;

(b)Where a company is not carrying on any business or operation for a period of two immediately preceding financial years and has not made any application within such period for obtaining the status of a dormant company under section 455 of the Companies Act, 2013; or

(c)the subscribers to the memorandum have not paid the subscription which they had undertaken to pay at the time of incorporation of a company and a declaration to this effect has not been filed within 180 days of its incorporation. This provision is applicable to companies incorporated after 02nd November, 2018; or

(d)the company is not carrying on any business or operations as revealed after the physical verification carried out under section 12(9) of the Companies Act, 2013.

Before making an application to the ROC for removal of the name of the company, the board of directors of the company shall take all the steps necessary in order to extinguish all its liabilities. Approval of the shareholders by way of special resolution or consent of seventy-five percent members in terms of paid-up share capital is also required to be taken for filing an application to the ROC for the removal of the name of the company from the Register of Companies.

In the case of a company regulated under a Special Act, approval of the regulatory body constituted or established under that Act shall also be obtained and enclosed with the application.

In the particular case, since the proposal has been approved by only 66% of the shareholders in terms of paid-up capital as against the required percent of 75%, the ROC will reject the application for removal of name of company from register of members.

Source⁠‌‌‌‌⁠: ICSI Guideline Answers, December 2024, Q. 6A(iii) (Syllabus 2022).

June 2024Q. 6A(ii)5 marksSyllabus 2022

(ii)Try & Win Ltd company has applied to Registrar of Companies (ROC) for striking off its name from register of companies on 22nd July, 2023. Company has recently [on 26th June 2023] shifted its registered office from Patna to Kolkata. What are legal provisions in this context ? Elucidate.