Closing a Private Limited Company in 2026: STK-2 Strike-Off, Costs and What Happens After

ROC Compliance | RegisCorp Team

Checked on 24 October 2026. Closing a private limited company in India is not a matter of stopping work and ignoring the paperwork. A company that is simply abandoned keeps its filing duties, its penalties and its directors' exposure, and the registrar can eventually strike it off on its own initiative, which is a worse way to end than choosing the route yourself. This post explains the voluntary route, which is a strike-off application on Form STK-2 under Section 248(2) of the Companies Act, 2013: who can use it, the conditions, the forms, the fee, the realistic timeline, what happens to the directors afterwards, and how a struck-off company is brought back. It also marks where the sources we read disagree.

RegisCorp Consultancy LLP is a digital-first legal and compliance firm in Kota, Rajasthan, working with businesses across India. We write these guides so you can check the rules before you pay anyone, including us.

Key takeaways

• Voluntary strike-off is for companies that have stopped trading, not for companies in trouble. The usual test is that the company has carried on no business for the two immediately preceding financial years, or never started business within a year of incorporation.
• It needs a clean slate first. Pages we read list: no liabilities, assets disposed of, bank accounts closed, GST registration cancelled, and the annual filings (AOC-4 and MGT-7) made up to date. Unfiled returns are the commonest reason a strike-off stalls.
• The government fee is Rs 10,000, reported by three pages. Stamp paper, a chartered accountant's certificate and professional fees are extra, and no page we read gave a reliable total.
• Three directors' documents are involved: STK-3 (indemnity bond), STK-4 (affidavit) and STK-8 (statement of accounts certified by a chartered accountant, dated within 30 days of filing). A board resolution and consent of at least 75 percent of members, by special resolution or consent, are also needed.
• Timeline sources differ. One page says about 60 to 90 days including a 30-day objection window. Another earlier source we read said 3 to 6 months. Plan for several months, not weeks.
• Strike-off does not erase directors' responsibility. Pages say directors and members remain liable for past dues and for fraud or wrongful acts, and that unclaimed assets pass to the Central Government.
• Restoration is possible but slow and costly. It goes through the National Company Law Tribunal under Section 252. One page reports a cost of Rs 50,000 to Rs 1,50,000 and 6 to 12 months.
• If you are not ready to close, there are other options, such as keeping the company compliant while dormant, or converting the structure. Do not skip filings in the meantime.

The key numbers and dates in one place

Step 1: confirm the company is eligible

A company can use STK-2 only if it meets all the conditions below, according to the pages we read. Check each one honestly. The registrar can reject an application that does not.

1. No business activity. The company has carried on no business for the two immediately preceding financial years, or did not start business within one year of incorporation.
2. No liabilities. Creditors, lenders, employees and statutory dues are cleared.
3. No assets, or assets disposed of. The bank account is closed.
4. No disputes. No litigation or proceedings that affect the closure, including in the last three months.
5. No recent corporate action. One page says the company must not, in the previous three months, have changed its name, shifted its registered office between states, applied to the tribunal for a compromise or arrangement, or been wound up under another law.
6. Filings up to date. Overdue AOC-4 and MGT-7 are filed up to the year in which business ceased. See our post on AOC-4 and MGT-7 for the dates and late fees.

Who cannot use it

One page lists listed companies and Section 8 companies as excluded, along with companies under inspection or investigation, facing prosecution, holding public deposits, or classed as vanishing companies. Section 8 companies are charitable companies like those in our post on Section 8 company registration, so they need a different exit.

A conflict on non-banking finance companies

An earlier source we read lists non-banking finance companies as excluded. Another page says they are not excluded but need an NOC from the Reserve Bank of India, and that leaving it out may make the application incomplete. We could not settle this. If you are such a company, take advice before you file.

Step 2: clear the ground before you file

Most strike-off delays come from what was not done before the application, not from the application itself.

File the overdue returns

If AOC-4 or MGT-7 are pending, file them first with late fees. One page notes that a company with unfiled annual returns for two consecutive years can be struck off by the registrar on its own initiative, and that such a strike-off may lead to director disqualification. Do not wait for that.

Close or settle the money side

• Pay the creditors, lenders and employees.
• Collect or write off what is owed to the company, and distribute or dispose of the assets.
• Close the bank account and get the closure letter or certificate.

Cancel registrations

Pages list the GST cancellation proof as a document. If the company is registered under GST, apply to cancel it and file the final return. Our post on GST registration covers the registration side. Also close other registrations such as the PF and ESI codes, professional tax and Shops and Establishment licence if you hold them, and file the last returns.

Deal with the income tax side

Companies need a final income-tax return and, where applicable, a TDS return for the last period. The registrar's process includes a notice to the Income Tax Department, which can object, so an open tax dispute can stop the strike-off.

Step 3: pass the resolutions and prepare the documents

Pages list these documents.

• Board resolution authorising the application.
• Special resolution or consent of members holding at least 75 percent of paid-up share capital. One page says 75 percent of members.
• STK-3, an indemnity bond executed by every director, on non-judicial stamp paper. One page puts the stamp paper at Rs 100 to Rs 500 in most states.
• STK-4, an affidavit executed by every director, declaring that the company meets the conditions.
• STK-8, a statement of accounts certified by a chartered accountant, dated no more than 30 days before filing. Another page calls this the audited statement of accounts, so confirm what your adviser will certify.
• A litigation statement and any regulator's NOC, where the company is regulated.
• The certificate of incorporation, the memorandum and articles, and the directors' identity proofs and digital signatures.

Directors should check that their own records are in order. If a director's DIN is deactivated for missing KYC, the application can get stuck. See our post on Director KYC.

Step 4: file STK-2 and what happens next

1. File Form STK-2 on the MCA portal, signed digitally by a director and certified by a chartered accountant, company secretary or cost accountant.
2. Pay the Rs 10,000 fee.
3. The registrar examines the file and may ask questions. Answer them promptly.
4. Notices go out. One page says the registrar issues a notice, reported as STK-6, to authorities such as the Income Tax Department to ask for objections. A public notice, reported as STK-5, invites objections from anyone else.
5. If no valid objection is received, the registrar strikes the company off the register and publishes the notice in the Official Gazette. The company is then treated as dissolved.

The same page says that once the registrar issues a notice of the other kind, reported as STK-7, under Section 248(1), the company can no longer file STK-2. That form belongs to the registrar's own strike-off process for companies that have defaulted, so a company that wants to choose its exit should file before that happens.

Timeline and cost

One page says the voluntary process takes about 60 to 90 days from filing, including a 30-day objection window, compared with 6 to 12 months or more for winding up. An earlier source we read said 3 to 6 months and gave a total cost range of Rs 15,000 to Rs 40,000, or "from Rs 17,000", including professional fees. We could not verify either. Take the longer timeline for planning, and ask each adviser for a written quote that separates their fee from the government fee, stamp paper and late fees.

What happens after strike-off

• The company loses its legal identity. It can no longer sign contracts, hold property or be sued in its own name, according to one page.
• Remaining assets pass to the Central Government. Do not leave money in a closed company.
• Directors and members stay liable. Two pages say they remain liable for past dues, fraud or wrongful acts during the company's life.
• The DIN stays active after a voluntary strike-off, according to one page. After a strike-off by the registrar for non-compliance, directors may be disqualified under Section 164(2). That disqualification is a serious consequence, so we repeat the point that choosing the voluntary route is better.
• Final tax duties. Pending income-tax and GST matters survive. A struck-off company's old liabilities can still be pursued.

Step 5: if you need the company back

A struck-off company can be restored by the National Company Law Tribunal under Section 252, if the applicant shows a good reason.

• Time limit. One page reports 20 years from the Gazette notice for a company. Another earlier source we read said 3 years for an aggrieved party and 20 years for the company, members or creditors. For a limited liability partnership, one page reports 3 years. These differ, so ask a professional about your case.
• Who can apply. The company, a member, a creditor or a workman.
• Process. A board resolution, audited accounts for the defaulted years, a petition with a director's affidavit, filing before the right bench, notice to the registrar who gets 30 days to respond, and usually two to four hearings.
• Cost and time. The same page reports Rs 50,000 to Rs 1,50,000 and 6 to 12 months.
• After restoration. The tribunal can order pending returns to be filed within 30 to 90 days and penalties to be paid. A restoration can be vacated if the conditions are not met.

The cost of getting a company back is usually far higher than the cost of closing it correctly the first time.

Dormant instead of closed

An earlier source we read said a company that wants to keep its name and registration but has no activity can apply for dormant status on Form MSC-1 under Section 455. We could not re-verify the details, including the fee and the annual filing needed. A dormant company is a way to pause, not a way to avoid filings, and it does not suit a company that will never trade again.

Closing a company or changing the structure

If the real issue is that the company costs too much to keep, compare the options. Our post on private limited company, LLP, OPC or partnership sets out the running costs of each. For an LLP, the exit is different; see our post on LLP annual compliance for the filing side. A startup that has a recognition certificate should also consider what closing does to it; see Startup India recognition.

A worked example: a dormant trading company

A private limited company in Kota sold goods online and stopped trading in March 2024. By October 2026 it has filed nothing for FY 2024-25 and has a bank balance of Rs 40,000.

• It stopped business for FY 2024-25 and FY 2025-26, so it has had no business for two financial years.
• It must file AOC-4 and MGT-7 for the year in which business ceased and for any later year the registrar expects. Late fees apply.
• It should cancel its GST registration and file the final return.
• It should distribute or pay out the Rs 40,000 and close the bank account.
• Both directors sign STK-3 and STK-4. A chartered accountant certifies STK-8 within 30 days of filing.
• The company passes a board resolution and gets consent of holders of at least 75 percent of its paid-up capital.
• It files STK-2 and pays Rs 10,000.

On the timelines reported, the strike-off might take two to six months after filing, and the late fees and professional fees come on top of the Rs 10,000.

A second worked example: why not just stop filing

A company with Rs 10 lakh of past debts to a supplier stops trading and files nothing. Two years later the registrar issues a notice to strike it off for default. The supplier's debt is not wiped out: the directors remain liable to the extent that the law and the facts support, and the directors may face disqualification under Section 164(2). A company with debts cannot use STK-2, so the right route is to settle or compromise the debt first, or to consider winding up. This is a case for a lawyer, not a form.

Common mistakes

• Applying with unfiled returns. The application fails or stalls.
• Closing the bank account but leaving GST open. Returns and late fees keep running.
• Leaving money or property in the company. It passes to the government.
• Signing the indemnity bond without reading it. Directors take on real obligations.
• Using an old statement of accounts. One page says STK-8 must be dated within 30 days of filing.
• Assuming strike-off ends personal liability. It does not for past dues or wrongful acts.
• Ignoring the registrar's own process. Once a registrar-initiated strike-off notice is issued, STK-2 is barred.
• Choosing the cheapest quote without a written scope. Check what the fee covers.

Frequently asked questions

Can I close a private limited company without winding up?

Yes, if it meets the conditions for a strike-off under Section 248(2), mainly no business for two years and no liabilities. Otherwise winding up is the route.

What is the fee for STK-2?

Rs 10,000 government fee, reported by three pages. Other costs are extra.

Can a company with a loan file STK-2?

No. Pages say liabilities must be cleared first.

Who signs the documents?

Every director signs STK-3 and STK-4, and a director signs STK-2 digitally with a chartered accountant, company secretary or cost accountant certifying it.

How many shareholders must agree?

At least 75 percent, by special resolution or consent of members holding that share of paid-up capital. Pages describe it slightly differently, so follow your adviser's wording.

How long does it take?

One page says about 60 to 90 days. An earlier source said 3 to 6 months. Plan for months.

Do I need to file annual returns before closing?

Yes, up to the year in which business ceased, according to one page.

What if the company never started business?

A company that did not commence business within one year of incorporation is eligible under the same section.

Can directors be disqualified?

A strike-off by the registrar for default can lead to disqualification under Section 164(2), according to one page. The voluntary route does not deactivate the DIN, according to the same page.

Can I restore a struck-off company?

Yes, through the National Company Law Tribunal under Section 252. A company can apply for up to 20 years on one page's account, though pages differ.

Is the company's name freed after strike-off?

We did not find a reliable statement. Ask your adviser.

Does a Section 8 company use the same route?

One page lists Section 8 companies as excluded from STK-2.

Is closing cheaper than keeping a company dormant?

It depends on how long you will stay dormant. A dormant company still has some filing duties. Ask for both quotes.

What to do next

1. Check the eligibility list above honestly, especially the two-year no-business test.
2. List every filing you have missed and file them first.
3. Clear dues, cancel GST and other registrations, and close the bank account.
4. Ask a chartered accountant or company secretary for a written quote that separates their fee, the Rs 10,000 government fee, stamp paper and late fees.
5. Have all directors read the indemnity bond and affidavit before they sign.
6. After strike-off, keep the records and the Gazette notice safe, because old liabilities can still be raised.

If you want help with a strike-off, a pending-filings clean-up or choosing between closing and pausing, contact RegisCorp. See also our post on ROC compliance for a private limited company for what a company that stays open must file.

This post is general information, not legal or tax advice. Rules change, so check your facts with a qualified professional before you act.

Sources and what we could not verify

Sources used

• Patron Accounting, company strike-off guide: eligibility, fee, timeline, liability and restoration. Published 6 February 2026, updated 6 April 2026.
• TaxGuru, company closure under Section 248(2): conditions, exclusions, STK-3, STK-4, STK-8 and the notices. Published 14 July 2026.
• Razorpay Rize, Form STK-2: documents, fee and steps. Published 27 August 2025.
• IncorpX, NCLT restoration of a struck-off company: Section 252, time limits, process and cost. Dated 11 April 2026.

All of these are secondary or commercial sources, and several promote the publisher's own services. We did not open the Companies Act, the Companies (Removal of Names of Companies from the Register of Companies) Rules, the MCA forms or the government portals. The points about the 3 to 6 month timeline, the cost range, the 3-year restoration window for an aggrieved party and the MSC-1 dormant status come from pages we read earlier in our research and are not linked here.

What we could not verify

• The timeline, which differs between sources, and the total cost.
• Whether non-banking finance companies are excluded or need a regulator's NOC.
• The restoration time limits for a company and for an aggrieved party, and the rule for limited liability partnerships.
• The exact notice forms and their order, and what the registrar checks.
• The dormant status rules under Section 455 and Form MSC-1, and any time-limited fee relief scheme that may have run in 2026.
• Whether STK-8 needs to be audited or only certified by a chartered accountant.
• Any change after 24 October 2026.