Closure of Company means to apply before the ministry of Corporate Affairs for removing the name of the entity from the register under the registrar of companies which upon successful satisfaction may be granted by the Ministry.
The company can close at any point for the fulfillment of certain conditions as specified by the Ministry of Corporate Affairs. Dormancy is different from Closure. In Dormancy, a company needs to file an annual return of dormancy every year after the Ministry has approved the status.
Points to be considered before applying for Closure
- The company should not be under any investigation/inspection
2, There should be no pending prosecution in the court of law
- The company should not have any outstanding deposit or other dues towards any financial institution/banks / Govt. bodies
- The directors should not have been disqualified by the Ministry of Corporate Affairs
- there should not be any stay order on the company where the filing of documents has been barred by the judicial/quasi-judicial bodies.
- The company should have closed the bank accounts and should have procured a bank account closure certificate from the bank in their letterhead.
Once the form is filed for closure, Ministry of Corporate Affairs shall Scrutinize the form and subject to the satisfaction, the closure shall be approved, it takes around six to eight months.