Revival of Struck off Company

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Within the dynamic landscape of Indian corporate life, unforeseen circumstances can occasionally lead to a company's name being struck off the Register of Companies. However, even for entities seemingly consigned to closure, the Companies Act, 2013 offers a beacon of hope: the transformative power of revival. This guide sheds light on the path for companies seeking to rise from the ashes and reclaim their rightful place within the Indian business ecosystem.

Section 252 of the Companies Act, 2013 empowers various parties to petition for the revival of a struck-off company, primarily:

  • The company itself or its members: This provision allows companies experiencing temporary lapses to overcome compliance hurdles and re-establish their corporate standing.
  • Creditors and employees: For these stakeholders, revival safeguards financial interests by facilitating the settlement of outstanding dues and entitlements.
  • Any other person aggrieved by the striking off: This expansive clause enables anyone demonstrably impacted by the closure, such as business partners or investors, to seek its reversal.
Eligibility Criteria:

Not all struck-off companies are eligible for revival. Specific prerequisites must be met:

● Timely Petition: The petition must be filed within three years of the company’s strike-off order.

● Demonstrably Just and Equitable Justification: The petitioner must present compelling evidence establishing a justifiable reason for revival, such as inadvertent errors, unforeseen hardships, or potential benefits to stakeholders through restoration.

● Maximum Duration: The company’s name must not have been struck off for more than 20 years.

Benefits of Revival:

Restoring a struck-off company offers several advantages:

● Second Opportunity: This provides the entity with a fresh start, allowing it to resume operations and reclaim its market position.

● Debt Resolution: Revival paves the way for resolving outstanding dues to creditors and employees, ensuring they receive rightful compensation.

● Dispute Resolution: It helps clear the path for resolving legal disputes and reclaiming assets frozen due to the strike-off.

● Enhanced Stakeholder Confidence: Successful revival demonstrates the company’s commitment to overcoming challenges and adhering to legal frameworks, potentially rebuilding trust with stakeholders.

Detailed Step-wise Procedure:

The revival process follows a defined and meticulous course:

1. Petition Drafting and Filing: A carefully crafted petition outlining the grounds for revival and supported by compelling evidence is filed with the National Company Law Tribunal (NCLT).

2. Notice and Service: The NCLT directs the Registrar of Companies (ROC) and relevant stakeholders to be served with the petition and invited to file responses.

3. Hearing and Arguments: The NCLT hears arguments from all parties involved and scrutinizes the petition’s merits and supporting evidence.

4. Order and Revival: Based on the hearing, the NCLT issues an order either dismissing or granting the petition. If granted, the company’s name is restored to the Register of Companies, marking its official revival.

Required Documents:

To strengthen your petition, be prepared to provide:

● Certified copies of the company’s Memorandum of Association (MOA) and Articles of Association (AOA).
● Board resolutions authorising the petition filing.
● The strike-off order issued by the ROC.
● Comprehensive evidence supporting the revival grounds, such as affidavits, financial statements, or legal documents.
● Proof of service of the petition on relevant parties.

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Common Questions

Most Popular Questions

When a company is struck off, it means that it has been removed from the register of companies by the Registrar of Companies (RoC) due to non-compliance or failure to file necessary documents.

Yes, a struck off company can be revived by filing an application for revival with the National Company Law Tribunal (NCLT) and obtaining an order for restoration.

Grounds for striking off may include failure to file annual returns, failure to commence business within one year of incorporation, non-compliance with regulatory requirements, or voluntary winding up.

The procedure involves filing an application with the NCLT, submitting required documents, publishing notices, obtaining creditors' and shareholders' consent, and obtaining an order for restoration.

The revival process typically takes around 6 to 12 months, depending on various factors such as the complexity of the case and NCLT processing time.

Documents such as the application for revival, affidavit, indemnity bond, statement of affairs, board resolution, and consent of creditors and shareholders are required.

Non-compliance may lead to rejection of the revival application, legal consequences, and continued dissolution of the company.

Yes, Avenue Advisory provides expert assistance for the revival process, including drafting applications, preparing documents, and representing clients before the NCLT.

Avenue Advisory ensures compliance by guiding clients through the process, preparing accurate documents, and facilitating timely filings with the NCLT.

Outsourcing to Avenue Advisory ensures efficiency, accuracy, and professional representation, enabling companies to successfully revive and resume their operations.

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