- A company qualifies if it never started business within a year of incorporation, or has carried on none for the two preceding financial years.
- Overdue AOC-4 and MGT-7 returns must be filed before the STK-2 goes in.
- C-PACE struck off 38,658 companies and 8,368 LLPs between 1 May 2023 and 31 July 2025.
- The ROC can also strike off a company itself under section 248(1), after a 30-day notice.
On this page
When is strike-off the right exit, and when is liquidation?
Strike-off suits a clean, empty company. Voluntary liquidation suits one that still holds assets or has creditors to pay.
| Route | Best for | How it ends |
|---|---|---|
| Voluntary strike-off (STK-2) | No business, no assets, liabilities cleared | C-PACE removes the name, usually in under 2 months |
| Voluntary liquidation (IBC section 59) | Solvent company with assets to distribute | Liquidator’s final report within 270 days with creditor approval, otherwise 90 days |
| ROC strike-off (section 248(1)) | Defunct company that stopped filing | ROC acts on its own after notice |
The liquidation route starts with a declaration of solvency by most directors, backed by a valuer’s report, as KS&K’s note on the 2022 voluntary liquidation amendment explains.
Strike-off is faster and cheaper. But one open liability sinks it.
What happens to employees when a subsidiary closes?
Their employment must end lawfully before the company does. And the money moves fast.
Closure is one of the exit events in section 17(2) of the Code on Wages, 2019. Final wages are due within two working days. Gratuity follows its own 30-day clock, and leave encashment and notice pay go into the final settlement too.
Here’s the mistake. A parent decides to close, runs the last payroll late, and only then asks who will keep the team. By then the best people have offers elsewhere.
The better sequence moves people first. Think of it as an EOR-to-entity transfer run backwards: your team keeps working through an EOR while the empty entity winds down. Our post on retaining top talent while closing a foreign subsidiary walks through it.
Does switching to an EOR make strike-off easier?
Yes. Once your staff sit on an EOR, the subsidiary has no payroll, no employees and often no business, which is exactly what STK-2 needs.
You still clear tax, GST and ROC dues. Then you file. The pending Corporate Laws (Amendment) Bill, 2026 would not change this route yet, as it is not law. Our guide on the subsidiary-to-EOR switch in India covers the timing.
How does Remunance support a subsidiary closure?
Remunance takes your India team onto its own entity first, carrying over roles and pay, so their work continues while your wholly owned subsidiary is wound down. We handle offboarding from the old entity, onboarding on ours and full and final settlement in between. To close an entity without losing the team, plan a subsidiary exit with us.
What else do people ask about company closure in India?
How long does it take to strike off a company in India?
Under C-PACE, voluntary strike-offs are processed in under two months on average, compared with over two years earlier. Clearing overdue filings beforehand often takes longer than the application.
What is Form STK-2?
STK-2 is the company’s application to the Registrar to remove its name under section 248(2). Directors file supporting indemnities and affidavits with it, plus a recent statement of accounts.
Can a company with employees be struck off?
Not while employment and dues are live. Every employee’s exit and final settlement must be complete, and all liabilities extinguished, before the company applies.
Planning a hire in India?
Our founding team has run payroll and hiring in India for 22+ years, first as Remunance Systems, which was later acquired by ADP.