Strike off Notices

Strike Off Notices: Section 248, STK-1 to STK-7, and What to Do Before Your Company Is Dissolved

When the Registrar of Companies (RoC) issues a Form STK-1 notice, a 30-day clock starts — and ignoring it almost always ends in dissolution. Under Section 248 of the Companies Act, 2013 and the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016, the RoC can strike a company off the Register unilaterally. Equally, a promoter running a shell or dormant company can exit cleanly through a voluntary application in Form STK-2. This article walks through every form in the STK series, what triggers each one, and the exact steps required to respond, exit, or restore.

The Legal Framework: Section 248 and the 2016 Rules

Section 248 of the Companies Act, 2013 gives the RoC the power to initiate strike off proceedings on its own motion (suo motu) or to accept a voluntary application from the company itself. The procedural machinery is set out in the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016, which prescribe seven forms — STK-1 through STK-7.

These rules operate alongside Chapter XVIII of the Act (Removal of Names of Companies). They do not require a court order for the initial strike off; only restoration requires approaching the National Company Law Tribunal (NCLT) under Section 252. This matters because the entire strike-off lifecycle — from notice to dissolution — can conclude within three to six months without any judicial involvement.

Since FY 2025-26, the MCA has intensified its registry clean-up drive under its corporate governance initiative, identifying companies with non-filing patterns across MCA V3 data. Expect STK-1 notices to continue at scale through FY 2026-27.

Grounds for RoC-Initiated Strike Off (Section 248(1))

The RoC may strike off a company if any one of the following four grounds is satisfied:

1. Non-commencement of business: The company was incorporated but failed to commence business within one year of its date of incorporation.
2. Inoperative for two consecutive financial years: The company has not carried on any business or operation for the two immediately preceding financial years and has not applied for dormant company status under Section 455.
3. Subscription money unpaid: The subscribers to the memorandum have not paid the subscription amount and the declaration required under Section 10A has not been filed within 180 days of incorporation.
4. Registered office not functional: On physical verification, the RoC finds the company is not carrying on business from its registered address.

Ground 2 is the most commonly invoked. A company that has filed nil returns for FY 2023-24 and FY 2024-25 — even if its incorporation and past filings were compliant — is squarely within the RoC's sights by FY 2026-27.

STK-1: The RoC Notice You Cannot Afford to Ignore

When the RoC has "reasonable cause" to believe one of the above grounds exists, it issues Form STK-1 — a show-cause notice addressed to the company at its registered office and to every director individually. This is not a soft reminder; it is the formal commencement of dissolution proceedings.

What STK-1 contains

The notice specifies:

• The ground(s) under Section 248(1) that the RoC believes are satisfied
• A direction to send a written representation within 30 days, along with supporting documents
• A warning that failure to reply will be treated as no objection to strike off

STK-1 is also published on the MCA website. Any director, creditor, or regulator can view it.

Your 30-day response window — used carefully

Thirty days sounds comfortable. In practice, by the time the notice reaches the registered address (which itself may be problematic for many companies), 7–10 days can evaporate. The response must be substantive and documentary. A bare email saying "we are operational" will accomplish nothing.

A strong STK-1 response should include:

1. Bank statements for the preceding 24 months showing actual transactions — salary, vendor payments, or even utility debits demonstrate operational reality
2. GST returns (GSTR-1, GSTR-3B) filed with the GST portal for the relevant period
3. Income-tax filings — ITR-6 for the company and confirmation from AIS/TIS of TDS deductions or advance tax payments
4. Contracts or purchase orders in force, even if low in value
5. Pending AOC-4 and MGT-7 filed (with late fees) before the response — filing during the response period is far more persuasive than promising to file
6. Director affidavit on stamp paper explaining the reason for any dormancy and the roadmap for resumption

Where the company is genuinely inactive and the directors want to retain it, the response must include a committed, dated roadmap: specific forms to be filed by specific dates, with reasons why the company should not be struck off.

Where revival is not desired, do not respond defensively — instead, file Form STK-2 for voluntary strike off (explained below). A half-hearted STK-1 response that neither proves operability nor secures a clean exit is the worst outcome.

Voluntary Strike Off: Filing Form STK-2 Step by Step

Form STK-2 is used when the company itself applies for removal of its name under Section 248(2). This is the clean-exit route for promoters who incorporated a company speculatively, failed to commence business, or now wish to wind down a shell entity without the cost and delay of a formal winding up under Sections 270–365.

Who cannot file STK-2?

Before filing, confirm that none of the following bars applies:

• Any prosecution initiated against the company and pending in any court
• Any compounding application pending under Section 441
• Any inspection, investigation, or inquiry under the Act initiated and not concluded
• Any petition for winding up pending before a court or NCLT
• Any liabilities — secured or unsecured — outstanding and unresolved
• The company has collected deposits, security interest subsisting over assets, or active employees on rolls

If any bar applies, STK-2 will be rejected and the company must resolve the underlying issue first.

Documents required for STK-2

Attach the following to the MCA V3 filing:

Step-by-step filing on MCA V3

1. Log in to MCA V3 (v3.mca.gov.in) under the company's Director Identification Number (DIN) or CIN
2. Navigate to e-File > Company Forms Filing > STK-2
3. Enter the CIN; the form auto-populates director and capital details — verify them carefully
4. Attach STK-3, STK-4, STK-8 (CA-certified), member consent, and litigation statement as PDFs
5. DSC (Digital Signature Certificate) of two directors is required; affix both
6. Pay the government filing fee (as per MCA fee schedule — currently Rs. 10,000 for most companies; verify the current amount on the MCA portal before filing)
7. Submit; note the SRN (Service Request Number) for tracking

The RoC has 30 days from receipt of a complete STK-2 application to proceed to public notice.

From Public Notice to Dissolution: STK-5, STK-6, and STK-7

Once the RoC initiates proceedings — either on its own motion or after receiving an STK-2 application — the following sequence plays out:

STK-5: Public notice for objections

The RoC publishes Form STK-5 simultaneously in:

• The MCA website (remains published for 30 days)
• The Official Gazette of India
• One English-language newspaper circulating in the district of the registered office
• One vernacular newspaper in the same region

The notice invites anyone — creditors, employees, other government departments — to submit objections within 30 days. Simultaneously, the RoC sends intimation to:

• The Income-tax Department (PAN-linked)
• GST/Central Excise authorities
• State Revenue authorities
• Any other regulator relevant to the company's activities (SEBI, RBI, etc., as applicable)

This is not a formality. The Income-tax Department actively monitors STK-5 notices and may object where the company has outstanding demand under the Income-tax Act, 1961, or unresolved AY 2027-28 assessments.

STK-6: Notice of dissolution

If no objection is received within 30 days of STK-5 publication and the RoC is satisfied, it sends Form STK-6 to the company and its directors — this is the formal intimation that the name is being removed.

STK-7: Publication of strike off in the Official Gazette

The final step is publication in the Official Gazette in Form STK-7. From the date of this publication, the company is dissolved — it ceases to exist as a legal entity. No further business can be conducted in its name, contracts cannot be entered into, and bank accounts should be closed by this point.

Consequences of Strike Off: What Directors Must Know

Dissolution is not a clean slate for directors. Several liabilities survive:

• Personal liability for debts: Every director, officer, and member continues to be personally liable for liabilities that existed at the date of strike off — these do not extinguish with the company.
• Income-tax scrutiny: The tax department can still assess the company, raise demands, and enforce them against directors as "principal officers" or as deemed assesses under the Income-tax Act, 1961.
• Asset vesting: Under Section 250, any property of the company that was not distributed before dissolution vests in the Central Government on strike off. This includes fixed deposits, real estate, and intellectual property. Recovery is possible only through NCLT restoration.
• DIN deactivation risk: Where a strike off follows a sustained non-filing pattern, the RoC may additionally deactivate the DINs of the directors involved, restricting their ability to be appointed in other companies.
• Criminal exposure for non-disclosure: Signing STK-4 (affidavit) with a false declaration of nil liabilities is a criminal offence under Section 448 (false statement) read with Section 449 (punishment), which can attract imprisonment up to two years.

Worked Example: The Cost of Inaction at Greenfield Ventures Private Limited

Background: Greenfield Ventures Private Limited was incorporated in April 2020 (CIN: U74999DL2020PTC000001) with an authorised capital of Rs. 1 lakh and two directors. The company never commenced business. It missed filing:

• AOC-4 for FY 2020-21, FY 2021-22, FY 2022-23, FY 2023-24, FY 2024-25 — 5 filings
• MGT-7 for the same 5 years — 5 filings

In February 2026, both directors receive Form STK-1.

Cost of clearing the backlog before responding:

MCA charges an additional fee of Rs. 100 per day per form for late filing of AOC-4 and MGT-7 (as per Schedule X of the Companies (Registration Offices and Fees) Rules, 2014, for companies with authorised capital above the minimum slab — confirm current rates on MCA V3 at the time of filing). Using this rate as illustrative:

Against this, voluntary strike off via STK-2 would cost approximately Rs. 10,000 in filing fees, plus Rs. 5,000–15,000 for stamp paper, notarisation of affidavits, and a CA certificate on STK-8. Total exit cost: under Rs. 30,000.

The arithmetic is unambiguous. Directors who let an RoC-initiated proceeding run its course — while also carrying a nine-lakh-rupee backlog of late fees — gain nothing. File STK-2 proactively, or respond to STK-1 immediately if the company is worth reviving.

Restoration Under Section 252: The NCLT Route

Once a company is struck off and STK-7 is published in the Official Gazette, it can be restored only by the National Company Law Tribunal (NCLT) under Section 252. The key parameters:

• Who can apply: The company, any member, creditor, or workman aggrieved by the strike off. The Income-tax Department, GST authorities, and other regulators can also apply.
• Time limit: Within 20 years from the date of publication of STK-7 in the Official Gazette. In practice, creditor-driven applications are filed quickly; director-initiated ones are more common in the 1–5 year window when an asset or contract surfaces unexpectedly.
• Grounds: The NCLT will restore if:
• The company was carrying on business at the date of strike off, or
• It is just and equitable to restore the name

• Effect of restoration: The company is restored as if its name had never been removed — all contracts, proceedings, and liabilities revive as of the original strike-off date.
• Practical cost: NCLT filing fees (as per NCLT Rules, 2016) plus legal representation, which varies widely. Expect a minimum of Rs. 30,000–50,000 in total costs for a straightforward restoration, rising sharply where the RoC or tax department contests the application.

One critical point: any property of the company that vested in the Central Government on strike off does not automatically revert to the company on restoration. A separate application under Section 252(3) for vesting reversion is required, and there is no guarantee of recovery in full.

Common Mistakes That Accelerate Strike Off

These errors appear repeatedly in practice:

1. Using a virtual or rented registered office address without proper mail monitoring STK-1 notices are sent by registered post to the registered office. If the address is a shared workspace or the promoter's old home, the notice may not reach the director in time. The 30-day window can expire before anyone knows an STK-1 exists. Monitor the MCA website for STK-5 notices against your CIN — by that stage you are already past the STK-1 response window.

2. Filing a nil balance sheet and assuming the RoC is satisfied A nil-activity balance sheet filed on time demonstrates compliance but does not prevent the RoC from initiating action under Section 248(1)(b). File AOC-4 and MGT-7 on time, and ensure the registered office remains functional with a demonstrable presence.

3. Signing STK-4 without verifying all liabilities Directors sometimes overlook contingent liabilities — a GST demand under appeal, an employee provident fund outstanding, or a guarantee invoked by a creditor. Signing the affidavit without clearing or adequately disclosing these exposes directors to Section 448 liability.

4. Assuming the company is "safe" because GST registration is surrendered GST cancellation does not remove a company from the Companies Act register. The MCA and GST systems are separate. A company with a surrendered GSTIN can still receive — and ignore — an STK-1 notice.

5. Waiting for the CA or CS to flag the notice STK-1 is addressed to directors, not to their advisers. Unless you have standing instructions for your professional adviser to monitor MCA communications for your CIN, you may never be alerted.

6. Not updating the authorised signatory's DSC before filing STK-2 A common practical blocker: directors whose DSCs have expired or whose DINs have become inactive cannot sign the STK-2 e-form on MCA V3. DSC renewal and DIN KYC (DIR-3 KYC) must be current before you begin the voluntary strike-off process.

Key Takeaways

• Section 248(1) gives the RoC four independent grounds to strike off a company — non-commencement, two years' inactivity, unpaid subscription, and non-functional registered office. Any one is sufficient.
• STK-1 is a 30-day notice, not a warning. A substantive documentary response — bank statements, tax filings, GST returns — is the only effective defence. A bare denial or silence guarantees strike off.
• STK-2 (voluntary strike off) is the low-cost clean exit for defunct companies. Filing fees are around Rs. 10,000 on MCA V3. The required documents include STK-3 (indemnity bond), STK-4 (director affidavit), and STK-8 (CA-certified statement of accounts not older than 30 days).
• STK-5 is the public notice stage: the Income-tax Department, GST authorities, and creditors have 30 days to object. Outstanding tax demands or pending assessments will block a smooth strike off.
• Strike off does not extinguish personal liability of directors for pre-strike-off debts, and unrecovered company assets vest in the Central Government under Section 250.
• Restoration under Section 252 must go through the NCLT and is available for up to 20 years after publication of STK-7 — but is costly, adversarial if opposed, and does not guarantee recovery of vested property.
• The cost of clearing a 5-year filing backlog (AOC-4 + MGT-7 late fees) can easily exceed Rs. 9 lakh in additional MCA fees alone — far exceeding the cost of a voluntary strike off or of maintaining timely annual filings in the first place.