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struck-off company

Revival of Struck-Off Companies Under Section 252

Introduction

Reviving a struck-off company allows businesses to restore their legal entity status and continue operations. Under Section 252 of the Companies Act, 2013, companies whose names have been removed by the Registrar of Companies (ROC) can file a petition with the National Company Law Tribunal (NCLT) for restoration. This process provides an opportunity to reinstate the company, provided the necessary conditions and requirements are met.

Why Should a Company be Revived?

Protection of Assets

Revival helps recover and protect company assets that might otherwise be liquidated or transferred.

Avoidance of Penalties

Reactivation allows businesses to settle non-compliance issues and avoid further legal penalties.

Resumption of Business Operations

Enables the company to continue its business activities and maintain its legal existence.

Safeguarding Intellectual Property

Prevents the loss of trademarks, copyrights, or patents held by the company.

What Does Revival of a Struck-Off Company Mean?

The revival process involves reinstating a company that has been struck off the Register of Companies due to non-compliance, inactivity, or other statutory reasons. Once revived, the company regains its legal status, allowing it to:

  • Resume operations
  • Settle liabilities
  • Safeguard assets

Timelines for Filing a Revival Petition

By the Company or Directors

A petition for revival must be filed within 3 years from the date of striking off.

By Creditors or Other Interested Parties

A petition can also be filed by affected parties, subject to NCLT’s discretion.

Step-by-Step Process to Revive a Struck-Off Company

1. Assess the Reason for Striking Off

  • Understand the grounds on which the company was struck off (e.g., non-filing of annual returns, inactivity).

2. Prepare Financials and Filings

  • Compile audited financial statements, pending annual returns, and other compliance documents.

3. Board Resolution

  • Pass a Board Resolution authorizing the filing of the NCLT petition for revival.

4. Draft the NCLT Petition (Form NCLT-9)

  • The petition should include:
    • Details of the company
    • Reasons for non-compliance
    • A request for reinstatement

5. Filing of Petition with NCLT

  • Submit the petition with supporting documents to the NCLT, along with the applicable fees.

6. Publication of Notice

  • The NCLT will direct the petitioner to publish a notice in newspapers to inform stakeholders.

7. Hearing by NCLT

  • The NCLT will conduct a hearing to assess the petition and any objections raised by the ROC or stakeholders.

8. NCLT Order for Revival

  • If satisfied, the NCLT will issue an order directing the ROC to restore the company.

9. Filing with ROC

  • Submit the NCLT order to the ROC, along with necessary filings, to complete the restoration process.

Documents Required for Revival

  • Board Resolution: Approving the filing of the petition.
  • Audited Financial Statements: For the past financial years.
  • Affidavit and Indemnity Bond: From directors affirming compliance and indemnifying the ROC.
  • Pending Annual Returns and Compliance Documents: Filed with the ROC post-revival.
  • NCLT Petition (Form NCLT-9): Properly drafted with details of the struck-off status.
  • Proof of Publication: Notice in newspapers as directed by the NCLT.
  • Other Supporting Documents:
    • ROC’s order of striking off
    • Memorandum and Articles of Association
    • Details of creditors or stakeholders

Key Considerations

  • Ensure all pending dues, fines, and compliance filings are settled during the revival process.
  • Hire a professional to prepare the petition and represent the company in NCLT hearings.
  • Post-revival, maintain regular compliance to avoid future striking off.

Frequently Asked Questions (FAQs)​

Yes, provided the petition is filed within the specified time limit, and valid reasons are presented to NCLT.

 

The petition can be filed by:

  • The company
  • Its directors
  • Members, creditors, or any interested party

The cost includes:

  • NCLT filing fees
  • Professional fees
  • Any outstanding penalties or compliance costs

The company remains struck off, and assets may be liquidated. Stakeholders may need to explore alternate legal remedies.

Typically, it takes 3-6 months, depending on:

  • The complexity of the case
  • NCLT schedules