Closure of Private Limited Company in Chennai

Closing a Private Limited Company (Pvt Ltd) is a legal process governed by the Companies Act, 2013. If a company is inactive, facing financial losses, or no longer needed, it must be legally dissolved under the Companies Act, 2013 to avoid unnecessary penalties. At Chennai Filings, we provide expert assistance in company closure, ensuring that all legal formalities, filings, and approvals are handled smoothly. We help businesses close operations in a hassle-free and legally compliant manner.

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Why Would a Private Limited Company Need to Close in Chennai?

A Pvt Ltd company may need to be closed for several reasons, such as:

  • The company is inactive – No business activities have taken place in the company for more than two years.
  • Continuous financial losses – The company is unable to sustain itself due to continuous financial losses
  • Disputes among directors or shareholders – Making operations difficult.
  • Inability to pay debts – The company cannot repay its creditors.
  • Non-compliance with legal requirements – Not filing annual returns, financial statements, or statutory documents for a consecutive period of five years.
  • Tribunal or Court Order – If the company is found to be engaging in illegal activities or activities detrimental to the peace, integrity, and sovereignty of India.

If a company is not officially closed, it will continue to attract penalties and compliance obligations, even if it is not operating.

Methods of Closing a Private Limited Company in Chennai

Depending on the company’s financial and legal status, there are two ways to close a Private Limited Company.

1. Voluntary Closure (Fast Track Exit Mode)

If the company has been inactive for more than two years, it can apply for closure under the Fast Track Exit (FTE) mode, as per Section 248(2) of the Companies Act, 2013.

Eligibility for FTE:

  • No active business operations for two consecutive years.
  • No pending liabilities or debts.
  • The company has not filed financial statements for two years.

Process:

  • The company must pass a resolution for closure.
  • Directors must file an affidavit stating there are no pending liabilities.
  • The application shall be submitted to the Registrar of Companies (ROC) for approval.
  • Upon verification, the ROC strikes off the company’s name.

2. Compulsory Winding Up (By Tribunal Order)

A company can be forced to shut down if ordered by the National Company Law Tribunal (NCLT).

Reasons for Compulsory Winding Up:

  • Inability to pay debts.
  • Non-compliance with statutory requirements.
  • Fraudulent activities or mismanagement.
  • Failure to file the Annual Returns for five consecutive years.
  • Operations against public interest or national security.

Process:

  • A petition is filed with the NCLT.
  • The tribunal appoints a Liquidator to manage the closure.
  • The liquidator settles liabilities and files a final report with the ROC.
  • The ROC strikes off the company’s name and publishes a notice in the Official Gazette.

Step-by-Step Process to Close a Private Limited Company in Chennai

At Chennai Filings, we handle the entire company closure process efficiently and legally.

Step 1: Board Resolution for Closure

  • The company’s Board of Directors must pass a resolution approving the closure.
  • If the company has creditors, their consent must also be obtained.

Step 2: Filing Application with ROC

  • The company must file Form STK-2 with the Registrar of Companies (ROC).
  • Directors must submit an affidavit stating there are no pending liabilities.

Step 3: Public Notice in the Newspaper

  • A public notice is published in a popular and local newspaper to notify the general public of the closure.

Step 4: Settlement of Liabilities

  • If the company has any pending debts, they must be cleared before closure.

Step 5: ROC Verification & Striking Off Company Name

  • The ROC verifies all documents and checks for any pending compliance obligations.
  • If satisfied, the company’s name is removed from the MCA records.
  • The closure is published in the Official Gazette, confirming the company is dissolved.

⏳ Time Required: 2-6 months (depending on approvals from the ROC and Tribunal).

Forms Required for Company Closure

To close a Private Limited Company, the following forms must be filed:

Form STK-2 – Application for striking off the company’s name.

Form STK-3 – Statement of accounts confirming no liabilities.

Form STK-4 – Affidavit from directors declaring no pending dues.

Form STK-5 – Public notice for company closure.

Form STK-6 – ROC approval order for name removal.

Affidavit & Indemnity Bond – Legal declaration of closure.

NCLT Application (for compulsory winding up cases).

At Chennai Filings, we handle all paperwork, ensuring a smooth process!

Documents Required for Closing a Private Limited Company in Chennai

  • Board Resolution approving company closure.
  • Affidavit from directors stating no pending liabilities.
  • Statement of Assets & Liabilities signed by the company’s auditor.
  • No Objection Certificate (NOC) from creditors (if applicable).
  • Indemnity Bond from directors and shareholders.
  • Latest financial statements and tax clearances.
  • Newspaper publication of the closure notice.
  • Application for dissolution with ROC and Tribunal.

Why Choose Chennai Filings for Company Closure?

  • Hassle-Free Process – We manage all legal formalities, filings, and follow-ups.
  • Expert Compliance Guidance – Our experts ensure that you file the correct documents.
  • Quick Processing – Our team offers support around the clock to quickly close your company.
  • Affordable & Transparent Pricing –No hidden costs.
  • Ongoing Support – Assistance with tax clearances, filings, and compliance matters.

Don’t leave your inactive company open—close it legally with Chennai Filings!

Need to Close Your Pvt Ltd Company in Chennai? Contact Us Today!

At Chennai Filings, we ensure a smooth, error-free company closure process, so you don’t have to worry about future legal or compliance issues. Let’s get started today!

FAQ's

1. What happens if I don’t close an inactive company?

The company will continue to attract penalties for non-compliance, even if it has no business operations.

The process takes 2-6 months, depending on approvals from the ROC and Tribunal.

No, all debts must be cleared before applying for closure.

Yes, at least 3/4th of shareholders and all directors must agree.

Yes, the Registrar of Companies (ROC) must approve and issue a closure certificate.

No, once a company is officially struck off, it cannot be revived.

Yes, a public notice in a newspaper is required before applying for closure.

No, all pending annual returns and tax filings must be completed first.

Costs depend on ROC fees, legal filings, and professional charges. Contact us for details.

We provide end-to-end assistance, handling all legal, tax, and compliance aspects.

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