Revival of Struck-Off Companies in India

A struck-off company (also commonly searched as a "strike off company") is one whose name the ROC has removed from the register. When a company is marked "Struck Off," the ROC has removed its name from the register under the Companies Act, 2013. The company can no longer operate as a normal corporate entity, although certain liabilities and legal obligations may continue.

A struck-off company can, however, seek restoration through the NCLT under Section 252 within the prescribed time limits. If the Tribunal restores the company, it can resume its legal existence after completing the required ROC filings and pending compliances.

Why Do Companies Get Struck Off?

Common reasons for striking off a company include:

• Failure to commence business: The company does not commence business within one year of incorporation.
• Prolonged inactivity: It does not carry on business or operations for two consecutive financial years without applying for dormant status under Section 455.
• Non-filing as a sign of inactivity: Persistent failure to file annual returns or financial statements can indicate that a company is no longer carrying on business. The ROC may use such non-compliance as a basis for initiating strike-off proceedings.
• Failure to file INC-20A: A company required to file the commencement declaration does not submit Form INC-20A within 180 days of incorporation.
• ROC action: The ROC finds the company eligible for strike-off after following the prescribed process.
• Voluntary closure: The company applies for strike-off under Section 248(2).

If the company was still operating when it was struck off, or restoration is otherwise just and equitable, these circumstances may support an application for revival before the NCLT.

Struck Off vs Winding Up

Both processes can end a company's legal existence, but their purpose and procedure differ.

Depending on the applicable provision under Section 252, an application may be made by:

• The company
• Any member
• Any creditor
• Any workman
• The ROC, in the circumstances provided under the Act

The restoration application is filed before the NCLT in the prescribed form, generally NCLT-9, with the required supporting documents.

Time Limit for Revival

The applicable time limit depends on the route used:

• Appeal under Section 252(1): An aggrieved person can appeal within three years from the date of the ROC’s order.
• ROC application under the proviso to Section 252(1): If the Registrar is satisfied that the company was struck off inadvertently or based on incorrect information, the ROC may apply to the Tribunal for restoration within three years from the date of the dissolution order under Section 248.
• Application under Section 252(3): The company, member, creditor, or workman can apply within 20 years from publication of the strike-off notice in the Official Gazette under Section 248(5).

The NCLT may restore the company if it is satisfied that the company was carrying on business or was in operation when it was struck off, or that restoration is otherwise just and equitable.

The following evidence can help establish the company’s operations, assets, rights, or liabilities:

• Property ownership: Title documents or other evidence of company-owned immovable property.
• Bank activity: Bank statements or records showing transactions before the strike-off.
• Tax and statutory records: GST, Income Tax, PF, or ESIC records showing continuing activity or compliance.
• Licenses and registrations: Relevant registrations such as trade license, professional tax registration, FSSAI license, or Shop & Establishment registration.
• Litigation or contracts: Pending cases, contractual rights, or obligations requiring the company’s continued existence.
• Income tax returns: Filed ITRs, including nil returns where applicable, supporting evidence of continued activity or compliance.
• Assets and liabilities: Records of loans, receivables, payables, or other outstanding obligations.
• Board resolution: Where applicable, a resolution authorizing the restoration proceedings.

If your company has been struck off, you can either apply for restoration through the NCLT under Section 252 or incorporate a new company. The practical choice depends on whether the existing company still has assets, rights, contracts, or obligations worth preserving.

Revival may make sense when the company still has:

• Assets: Property, bank balances, intellectual property, or other assets held by the company
• Contracts and licenses: Ongoing contracts, licenses, permits, or registrations linked to the existing entity
• Outstanding claims: Receivables, deposits, or pending litigation in the company's name
• Business history: An established brand, GST registration, customer relationships, or operating track record worth retaining
• Unresolved compliance issues: Director disqualifications, statutory dues, or other obligations that need to be regularized

A new company may be more practical when the struck-off company has no:

• Significant assets, contracts, or liabilities
• Important business history, registrations, or brand value to retain
• Need to preserve the existing company's legal identity

A new company can generally be incorporated faster than a restoration proceeding, while NCLT restoration may take several months and involve professional and filing costs. The actual timeline and cost depend on the company's circumstances and pending compliance.

Under Section 252 of the Companies Act, 2013, the NCLT may restore a company when the applicant and grounds meet the legal requirements.

A company may generally qualify for restoration when:

• The applicant is eligible: The company, a member, creditor, or workman can apply for restoration. An aggrieved person can also appeal against the ROC's strike-off order, while the ROC can seek restoration in certain cases.
• The application is filed on time: An appeal against the ROC's order must generally be filed within 3 years. A company, member, creditor, or workman can apply for restoration within 20 years from publication of the strike-off notice in the Official Gazette.
• The company was carrying on business or was in operation: Evidence such as financial statements, bank statements, ITRs, GST records, invoices, or active contracts can support this ground.
• Restoration is otherwise just and equitable: Pending litigation, company assets, contractual rights, liabilities, or other unresolved affairs may support the case for restoration.

Note: A company with no business activity, assets, or other legitimate reason for restoration may have a weaker case. The NCLT ultimately decides whether the statutory grounds for restoration are satisfied.

Before preparing the NCLT petition, keep the following documents ready:

• Petition in Form NCLT-9 and the affidavit verifying it in Form NCLT-6.
• Certified copy of the ROC's strike-off order/notice or the relevant Official Gazette publication.
• Memorandum and Articles of Association (MoA and AoA) and the Certificate of Incorporation.
• Board resolution authorizing the filing, where applicable.
• Financial statements for the years preceding the strike-off, including the balance sheet, profit and loss account, and auditor's report, as applicable.
• Bank statements for the relevant period to support evidence of business activity.
• Income Tax Returns, where filed.
• List of directors and shareholders.
• Proof of service of the petition on the ROC and Income Tax Department, where required.
• Vakalatnama or Memorandum of Appearance for the authorized representative.
• Supporting evidence for restoration, such as GST records, active licenses, property documents, contracts, or pending litigation records.

Tip: Prioritize documents that show the company was carrying on business or was in operation when it was struck off. Financial records, bank statements, ITRs, and GST records can be particularly useful for establishing this ground.

Reviving a struck-off company requires submitting an application to the NCLT under Section 252 of the Companies Act, 2013, followed by ROC filings and completion of the compliances directed by the Tribunal.

Step 1: File the NCLT Petition

Prepare the restoration petition in Form NCLT-9 and file it with the appropriate NCLT bench. File it within the applicable time limit: 3 years for an appeal against the strike-off order, or 20 years for an application by the company, member, creditor, or workman.

• State why the company was struck off and why it should be restored.
• Attach financial statements, bank records, ITRs, GST records, or other evidence that the company was carrying on business.
• File the verifying affidavit in Form NCLT-6.
• Pay the prescribed NCLT filing fee to restoration application.

Step 2: Serve the Petition on the Concerned Authorities

Serve a copy of the petition and supporting documents on the ROC and the Income Tax Department, as required by the Tribunal.

• Service is generally completed at least 14 days before the hearing.
• Keep the proof of service for submission to the NCLT.
• The ROC or other authorities may submit their objections or observations, often through a report from the Registrar.

Step 3: Attend the NCLT Hearing

At the hearing, the petitioner or their authorized representative presents the case before the Tribunal. The NCLT considers:

• Evidence that the company was carrying on business or was in operation.
• The reasons given for restoration.
• Any objections or observations from the ROC or other authorities.

Step 4: Receive the Restoration Order

If the NCLT is satisfied with the grounds for revival, it may order the company's name to be restored. The order typically also requires the company to:

• File all pending annual returns and financial statements.
• Pay applicable filing fees, penalties, and any costs the Tribunal directs be paid to the ROC (commonly around ₹25,000, or as specified in the order).
• Complete any other conditions specified by the Tribunal.

Step 5: File the NCLT Order with the ROC

Under Section 252(2) of the Companies Act, 2013, file a certified copy of the restoration order with the ROC in Form INC-28, generally within 30 days of the order (or as directed).

• Attach the certified NCLT order.
• Pay the applicable filing fee.
• Follow any additional directions included in the order.

Step 6: Clear Pending Compliances

After restoration, complete the company's outstanding filings and compliances as directed by the NCLT. These may include:

• Form MGT-7 for pending annual returns and Form AOC-4 for pending financial statements, with the additional fees under Sections 92 and 137 (₹100 per day per form).
• DIR-3 KYC for the directors to reactivate their DINs.

After restoration, settle any pending Income Tax, GST, PF, or ESIC dues.

Step 7: Restoration of the Company by the ROC

Once the NCLT order and required filings are processed, the ROC gives effect to the restoration and the company's status on the MCA portal returns to "Active." The company can then complete pending filings and meet any other requirements specified in the Tribunal's order. It is generally restored to the position it would have occupied had its name never been struck off.

It can also approach its bank to reactivate accounts and restore other registrations, though reactivation is subject to each bank’s or authority's own rules and verification.

Reviving a struck-off company through the NCLT generally takes 2 to 6 months. The timeline can be shorter or longer depending on the NCLT's schedule, the completeness of the petition, and whether any objections arise.

The NCLT hearing stage usually determines the overall timeline. Delays may arise from incomplete documents, a heavy caseload, authority objections, or pending compliances. Key factors include:

• Documentation: Missing records can require further submissions.
• NCLT schedule: Hearing dates depend on the Tribunal’s caseload.
• Authority objections: ROC queries or objections may cause delays.
• Multiple hearings: Additional hearings may be required.
• Pending compliances: Overdue filings can extend post-restoration work.

Reviving a struck-off company typically costs ₹30,000 to ₹1,00,000 or more. The final amount depends mainly on professional charges, the ROC cost ordered by the NCLT, and accumulated late-filing penalties.

The main expenses are:

Penalty and Late-Filing Fees on Pending ROC Returns

Once the company is restored, it must bring its overdue annual filings up to date. The additional fee is ₹100 per day of delay, per form, with no upper cap, in addition to the normal filing fee of ₹200–₹600 per form.

The key filings may include:

• AOC-4: Financial statements under Section 137.
• MGT-7: Annual return under Section 92.
• MGT-7A: Annual return for eligible small companies and OPCs.

As the additional fee accrues from the original due date until filing, a company with several years of pending returns can face substantial accumulated penalties. The final amount depends on the number of overdue forms and the length of the delay.

After filing the NCLT restoration order with the ROC in Form INC-28, the company can resume its legal existence. Since it is treated as having continued in existence as if it had never been struck off, its old liabilities, pending dues, filings, and other obligations remain in place. The company must then complete its pending compliances and meet any conditions specified in the NCLT order.

Clearing Pending ROC Filings and Statutory Dues

The NCLT order makes these mandatory:

• File overdue annual returns: Submit Form MGT-7 (Annual Return) and Form AOC-4 (Financial Statements) for every pending year, along with late fees under Sections 92 and 137.
• Settle other statutory dues: Clear outstanding Income Tax, GST, PF, and ESIC dues to avoid further penalties.
• Meet NCLT directions: Pay any costs or penalties the tribunal ordered and file any compliance affidavits it required.

Reactivating Accounts and Registrations

With "Active" status restored, the company can resume operations by:

• Unfreezing bank accounts: Submit the NCLT order and proof of active status to the bank to release frozen accounts.
• Renewing licenses and registrations: Reactivate or renew registrations affected by the strike-off, such as GST and IEC.
• Updating KYC: Refresh company and director KYC (including DIR-3 KYC) with the MCA and banks.
• Informing stakeholders: Notify key clients, suppliers, and lenders of the revived status to resume business.