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Shambhavi Suyesha
| Updated: 28 Jun, 2022 | Category: Event Based Compliances

Removal of Company Name from ROC under MCA’s new Companies Amendment Rules, 2022

Removal of Company Name from ROC
Reading Time: 4 minutes

The Ministry of Corporate Affairs (MCA), on 9th June 2022, issued the Companies (Removal of Names of Companies from Register of Companies) Amendment Rules, 2022, where it has amended provisions of  Companies (Removal of Names of Companies from Register of Companies) Rules, 2016. The Central Government makes this Amendment in the exercise of powers conferred by Section 248 (1), (2) and (4) and Section 469 of the Companies Act, 2013.

The Companies (Removal of Name of Companies from the Register of Companies) Amendment Rules, 2022 came into force on date of its publication in Official Gazette, i.e., 9th June 2022.

Overview of Removal of Company Name from ROC

Ministry of Corporate Affairs, on 26th December 2016, notified Sections 248-252 of Companies Act, 2013[1], which deals with the removal or striking off the name of companies from the Register of Companies. Section 248 empowers the Registrar of Companies (ROC) to remove the name of any company from Register if it believes that: (i) the company has failed to commence its business in one year from date of its incorporation or

(ii) the company is not carrying on any business for a period of two preceding financial years. Even this section makes liability for a company to voluntarily apply for the removal of its name on the same grounds mentioned above. In furtherance of Section 248, the Ministry notified on the same day, i.e., 26th December 2016, Companies (Removal of Names of Companies from Register of Companies) Rules, 2016.

Amendment made for Removal of Company Name from ROC

The followings are amendments made under Companies (Removal of Names of Companies from Register of Companies) Rules, 2016:

Removal of Company Name from ROC under Amendment Rules 2020

Prior to this Amendment of 2022, a Companies (Removal of Names of Companies from Register of Companies) Rules, 2020 was also made by the Ministry of Corporate Affairs, Central Government on 29th June 2020, where in Rule 4, sub-rule (3) (i) proviso was added and a Form STK 3A after Form STK 3 was inserted under the heading of Indemnity Bond. 

  • The proviso that was inserted in Rule 4, in sub-rule 3, in clause (i) are as follows:

Provided that in case of a-

  1. Government company in which the Central Government or State Government or more than one State Government or Central and one or more State Governments holds the total paid-up share capital, or
  2. A subsidiary of a Government Company in which that Government Company holds the total paid-up share capital, 

A notarised indemnity bond in Form STK 3A is given by an authorised representative, not below rank of Under Secretary or its equivalent, in administrative Department or Ministry of Central Government or State Government on behalf of the company.

  • In Form STK 2, the words “or by an authorised representative of administrative Ministry or Department in Form STK 3A” in Form 2 under the list of attachments were inserted. 
  • After Form STK 3, another Form STK 3A was inserted with the heading “Indemnity Bond”. 

Removal of Company Name from ROC under Amendment Rules 2022

The Amendments made under Companies (Removal of Names of Companies from Register of Companies) Rules, 2022 are as follows:

  • After sub-rule (3) in Rule 4 of Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 that talks about “Application for removal of the name of Company”, the following sub-rule is inserted:
  1. If the Registrar, after examining the applications made in Form STK-2, finds that it is necessary to call for further information or such application or any document attached therewith is defective or incomplete in any respect, then he informs the applicant for removal of defects and re-submission of complete Form within 15 days from date of such information and if the applicant fails then Registrar treats the Form as invalid in an electronic record and informs the same to the applicant. 
  2. If the Registrar, after re-submission of the Application Form or documents, finds that the Form or documents are defective or incomplete in any respect, he further gives a time of 15 days for removal of such defects or completion of the Form, and if the applicant again fails, then the Registrar treats the Form as invalid in an electronic record and informs about the same to the applicant. 
  3. Re-submission of application Form made before the commencement of Companies (Removal of Names of Companies from Register of Companies) Amendment Rules, 2022 is not counted for purposes of reckoning the maximum number of re-submission of such application Form. 
  • Form STK 1, STK 5 and STK 5A have been substituted under this Companies (Removal of Names of Companies from Register of Companies) Rules, 2022.

Conclusion 

In concluding to the information provided here, we get that MCA notified Companies (Removal of Names of Companies from ROC) Amendment Rules, 2022 on 9th June 2022. This Rule is the outcome of the Amendment made into Companies (Removal of Names of Companies from Register of Companies) Rules, 2016. In pursuant to Removal of Company Name from ROC under this Amendment Rules 2022, the Registrar may now call for further information or documents within 15 days if he finds that the application made to him is defective or incomplete in any aspect. Even after re-submission, if the Registrar finds that the information or documents are defective or incomplete, he may give 15 days to make changes. Any re-submission of the application made before commencement of this Companies (Removal of Names of Companies from Register of Companies) Amendment Rules, 2022 is not considered for the purposes of reckoning the maximum number of re-submissions of application in Form SKT 2. Another amendment is the substitution of Form SKT 1, STK 5, and SKT 5A.  

Read our Article:Appointment of Additional Director in a Company as per Companies Act, 2013

Shambhavi Suyesha

Shambhavi holds a strong legal background, having completed her BA LLB and LLM. She is particularly interested in legal research and writing, and wishes to utilise her knowledge to create informative legal content. She is an analytical researcher and keeps herself updated about the current legal affairs. She also holds prior experience in publishing articles on assorted legal areas.

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