{"id":41561,"date":"2022-03-29T12:35:15","date_gmt":"2022-03-29T07:05:15","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=41561"},"modified":"2022-03-29T12:35:16","modified_gmt":"2022-03-29T07:05:16","slug":"stk-2-form-purpose-norms-and-procedure","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/stk-2-form-purpose-norms-and-procedure\/","title":{"rendered":"STK 2 Form: Purpose, Norms, and Procedure"},"content":{"rendered":"\n<p class=\"has-drop-cap\">The Ministry of Corporate Affairs has\nlaunched STK 2 form for removing the company&#8217;s name from the register of\ncompanies. This removal process refers to the winding up of a company. The\navailability of the STK 2 form has been in effect since the 5th of April, 2017.\nThis write-up takes a brief look at the legalities around this form.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/stk-2-form-purpose-norms-and-procedure\/#Company_Name_Removal_from_the_Register_of_Companies\" >Company\nName Removal from the Register of Companies<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/stk-2-form-purpose-norms-and-procedure\/#Voluntarily_Removal_of_Company_Name_via_STK_2_Form\" >Voluntarily\nRemoval of Company Name via STK 2 Form<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/stk-2-form-purpose-norms-and-procedure\/#Closing_of_Company_via_STK_2_Form\" >Closing\nof Company via STK 2 Form<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/stk-2-form-purpose-norms-and-procedure\/#Requisites_for_filing_STK_2_Form\" >Requisites\nfor filing STK 2 Form<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/corpbiz.io\/learning\/stk-2-form-purpose-norms-and-procedure\/#Certification_of_Form\" >Certification\nof Form<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/corpbiz.io\/learning\/stk-2-form-purpose-norms-and-procedure\/#Outcomes_of_Name_Removal_from_the_Register_of_Companies\" >Outcomes\nof Name Removal from the Register of Companies<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/corpbiz.io\/learning\/stk-2-form-purpose-norms-and-procedure\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Company_Name_Removal_from_the_Register_of_Companies\"><\/span>Company\nName Removal from the Register of Companies<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The MCA introduced Section 248 to 252 of\nthe Companies Act, 2013 in Dec 2016 to underpin the legal framework for\nremoving company names from the Register of Companies.<\/p>\n\n\n\n<p><strong><em>Section 248 to 252 vests the ROC with the\ngiven powers for the removal of company&#8217;s name from the register of companies,\nin case Registrar has a legit cause to believe that; <\/em><\/strong><\/p>\n\n\n\n<ul><li>The\ncompany has failed to undertake its business activities within one year of its\nincorporation;<\/li><li>The\ncompany is not serving any business operation for two years, immediately past\nFYs. It has not filed any application for securing the status of the dormant\ncompany.<\/li><\/ul>\n\n\n\n<p>If such is the case, the ROC has the\nright to discard the company&#8217;s name from the register of companies by sharing\nnotification to the company and all the directors concerned. The notification\nfrom the Registrar would reflect the ROC&#8217;s intent to discard the company&#8217;s name\nfrom the register of companies and direct the company to share representations\nand copies of the applicable documentation within 30 days from the notification\ndate.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Voluntarily_Removal_of_Company_Name_via_STK_2_Form\"><\/span>Voluntarily\nRemoval of Company Name via STK 2 Form<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>This process for removing an entity name\ncan also be imitated by filing STK 2 form. To file this form, the company must\nbe free from all liabilities and execute a special resolution with the\npermission of 75 per cent of members in terms of paid-up share capital.<\/p>\n\n\n\n<p>If the company falls under a special Act,\nconsent of the regulatory body constituted under such an Act must be secured\nand attested with the application.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Closing_of_Company_via_STK_2_Form\"><\/span>Closing\nof Company via STK 2 Form<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>After filing STK 2 form, the ROC shall\nconfirm whether the company has made sufficient provision to realise all the\noutstanding amounts and from the payment of its obligations and liabilities\nwithin a reasonable time.<\/p>\n\n\n\n<p>If necessary, the ROC can also demand\nundertaking from the director concerned or other officials administering the\ncompany&#8217;s management.<\/p>\n\n\n\n<p>After addressing the said conditions, the\nRegistrar would issue a notice publically regarding the intended closure of the\nentity. After the expiration of the time cited in the public notice, the\nRegistrar can strike off the entity name from the register of companies.\nFurther, the ROC shall public notice relating to the strike-off of the\ncompany&#8217;s name in the Official Gazette.<\/p>\n\n\n\n<p>On publication of such a notice, a\ncompany is held to be dissolved.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Requisites_for_filing_STK_2_Form\"><\/span>Requisites\nfor filing STK 2 Form <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>All types of entities like OPC, public\nlimited company, private ltd company can apply for company&#8217;s closure via this\nform. The following are the standard documents that should be annexed with the\nSTK 2 form.<\/p>\n\n\n\n<ol><li>Indemnity bond notarised by company&#8217;s\ndirector in STK 3 form;<\/li><li>A statement of accounts reflecting the\ncompany&#8217;s assets and liabilities made up to a day, not surpassing 30 days\nbefore the application date and certified by a practising Chartered Accountant.<\/li><li>An affidavit in form STK 4 furnished by\nthe director concerned<\/li><li>A copy relating to special resolution\napproved by every director or 75 % of the members regarding paid-up share\ncapital as on the application date.<\/li><li>A\nstatement concerning pending litigations, if any, involving the company.<\/li><\/ol>\n\n\n\n<p><strong><em>In STK 2 form, the MD or Company&#8217;s\nDirector is mandated to declare that: <\/em><\/strong><\/p>\n\n\n\n<ul><li>There\nis no inspection ordered and performed or yet to be performed or being\nperformed against the company, and where inspections have been performed, no\nprosecution is due in the court of law arising out of such activities.<\/li><li>The\ncompany neither has any public deposits which are due, nor it is in default\nwhen it comes to repayment or interest thereon;<\/li><li>The\ncompany does not possess any secured, unsecured, or outstanding loans,<\/li><li>The\ncompany is free from any outstanding amount arising out of VAT, income tax,\nexcise duty, service tax, etc. payable to the concerned tax authorities.<\/li><li>All\nother company&#8217;s liabilities have been entirely addressed;<\/li><li>All\nthe conditions of the Companies Acts relating to the removal of the company&#8217;s\nname from the register of companies and concerns from the register of companies\nhave been met; <\/li><\/ul>\n\n\n\n<p><strong><em>If a company meets any of the given\nrequirements, STK 2 form cannot be filed:<\/em><\/strong><\/p>\n\n\n\n<ul><li>The entity altered its name or shifted its registered office to another state prior to 3 months of filing the STK 2 form; <\/li><li>The company disposed of rights or property that was under its possession prior to 3 months of filing the STK 2 form. This provision does not encompass trade wherein disposal of property occurs for a gain during the ordinary course of trading or undertaking business;<\/li><li>The company is involved with any other undertaking except from one which is cited in the MOA prior to 3 months of filing the STK 2 form<\/li><li>The company has filed an application before the Tribunal to authorise an arrangement or compromise, and the matter is still pending.<\/li><li>The company is being wound up as per the provisions of the Companies Act, 2013 or <a href=\"https:\/\/corpbiz.io\/learning\/the-insolvency-and-bankruptcy-code-second-amendment-bill-2020\/\"><strong>Insolvency and Bankruptcy Code<\/strong><\/a>, 2016.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Certification_of_Form\"><\/span>Certification\nof Form<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>STK 2 form must get the approval of\npractising CA or CS or Cost accountant<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Outcomes_of_Name_Removal_from_the_Register_of_Companies\"><\/span>Outcomes\nof Name Removal from the Register of Companies<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>If the STK-2 form is filed and receives\nthe ROC&#8217;s approval, the company would be dissolved according to the section 248\nof the Companies Act, 2013. Moreover, the business would cease to perform any\nundertaking, and the Incorporation certificate issued to it shall be considered\nto have been revoked from such date- except to realise outstanding amount and\nfor the payment of the company&#8217;s liabilities.<\/p>\n\n\n\n<p>Also, if a company is closed via STK 2\nform, the liability of all key officials such as the director, a manager who\nwas exercising any power conferred by the management, and of every member would\ncontinue to exist. It can be enforced as of if the entity had not been\ndissolved.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>STK 2 form is mandatory for companies no longer interested in carrying out business activities and wants to cease their existence in a legalized way. <strong>Ministry of Corporate Affairs<\/strong><sup><a href=\"https:\/\/www.mca.gov.in\/content\/mca\/global\/en\/home.html\"><strong>[1]<\/strong><\/a><\/sup> released this form to simplify the winding-up process, which otherwise is a complicated affair and attracts tons of paperwork. \u00a0 <\/p>\n\n\n\n<p class=\"text-left\"><b>Read our Article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/types-of-companies-under-companies-act-2013\/\">Types of companies under Companies Act, 2013\n<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Ministry of Corporate Affairs has launched STK 2 form for removing the company&#8217;s name from the register of companies. This removal process refers to the winding up of a company. The availability of the STK 2 form has been in effect since the 5th of April, 2017. This write-up takes a brief look at [&hellip;]<\/p>\n","protected":false},"author":22,"featured_media":41564,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[120],"tags":[2210],"acf":{"service_id":"321"},"authorName":"Pankaj Tyagi","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2022\/01\/MicrosoftTeams-image-42.jpg","authorDescription":"Pankaj has a diverse experience of writing research papers, blog, and articles during his college time. Earlier, he was working as a tax consultant in a financial firm, but his interest in writing drives him to pursue a career in the writing field.","postViews":12636,"readingTime":4,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/41561"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/22"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=41561"}],"version-history":[{"count":4,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/41561\/revisions"}],"predecessor-version":[{"id":41566,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/41561\/revisions\/41566"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/41564"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=41561"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=41561"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=41561"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}