Centre modifies form for closure of companies

So far, the notice in form STK-1 to be issued by the RoC spoke about circumstances like failing to start operations within one year of incorporation, not carrying on any business for two years and not applying for dormant status and share subscribers not paying the subscription amount agreed to be paid at the time of incorporation.

The amended form to notify removal of defunct companies from the record has added a new clause under section 12 of the Companies Act that allows the RoC to inspect the premises of the company when it is believed that the company is not carrying on any business.

The form gives the option for removal of the name of a company that is not carrying on any business or operations as revealed after the physical verification carried out under sub-section (9) of section 12, the order from the ministry showed. Under this provision, the registrar can inspect the premises of a company any time.

The government has been removing the names of defunct companies from the official register as part of a clean-up drive. Companies can become defunct for various economic reasons and they need not necessarily involve any wrong doing.

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