Power of the Registrar of the Company (ROC) to remove name of company from register of companies

  1. By using the power given in section 248(1) of the Companies Act, 2013 ROC has struck off 2,09,032 Companies from the register of companies.
  2. What is the case when Show Cause Notice(SCN) can be issued?



ROC can issue SCN in the following cases.

  1. When the company  has failed to commence its business within one year of its incorporation or;
  2. When the subscribers to the memorandum have not paid the subscription which they had undertaken to pay within a period of one hundred and eighty days from the date of incorporation.
  3. When a company is not carrying on any business or operation for a period of two immediately preceding financial years  and has not made any application within such period for obtaining the status of a dormant company under section 455,
  4. To whom SCN shall be issued by ROC ?



ROC shall send a SCN to

  • that company and
  • all the directors of that company.
  1. Consequences, if the Company is Strike off  by ROC ?

Following are the Results on that Company and Directors of that Company

  1. Disqualification of Directors for five years:

As per the provisions of section 164(2) If Company fails to file annual returns for continue period of 3 years or more then directors become disqualify for appointment in another company for a period of five years. If company strike off by SCN u/s 248(1) directors turn out to be disqualifying for appointment and appropriate action against the director can be taken.

  1. Banking operation or accounts of the company shall be freeze:

As discussed above the existing Directors and Authorized Signatories of such struck off companies will now become ex Directors or ex Authorized Signatories. These individuals will therefore not be able to operate bank accounts of such companies till such companies are legally restored under Section 252 of the Companies Act, 2013.

  • The status of the company on the website of the Ministry of Corporate Affairs shall be reflect ‘Struck off’ instead of ‘Active’.
  1. The company shall not be able to deal with its movable and immovable properties untill the restoration of name of the company.
  2. Office of the Director vacant u/s 167(1) (a) of Companies Act, 2013:

As per the provisions of section 167(1) (a) if a director become disqualifies u/s 164 then his office as director in all the companies simultaneously vacant. The director shall be ceased to continue as director in all other Companies.

  1. Penalty levy on the directors of the Company u/s 166 due to non compliance of their duties:

the director is liable for penalty or fine which shall not be less than one lakh rupees but which may extend to five lakh rupees.

  1. Remedies available after Strike Off the Company

As per the provisions of section 252 of Companies Act, 2013 and NCLT amended rules, 2017, power to revive the company held with NCLT and ROC. Further, following persons can make application to NCLT for make default clear

  • Any person aggrieved by order under section 248,
  • ROC himself
  • by Company
  • by member (shareholder)
  • by creditor
  • by workmen


Read Also:- MID-TERM REVIEW OF FTP 2015-2020, Released On 05.12.2017




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