MCA notifies Compulsory Filing of Overdue Financial Statements and Annual Returns for Closure of Companies [Read Notification]

The Ministry of Corporate Affairs (MCA) has made it compulsory to file all overdue financial statements and annual returns for closure of Companies, announcing new conditions for companies wishing to de-register with the Register of Companies (RoC) in India.

Earlier, The Ministry of Corporate Affairs (MCA) had made it compulsory to file all overdue financial statements and annual returns for closure of Partnership Firms, announcing new conditions for companies wishing to de-register with the Register of Companies (RoC) in India.

Read More: MCA makes Filing of Overdue Financial Statements and Annual Returns Compulsory for Closure of Firms

According to the changes, companies applying for removal of their names from the register will have to file financial statements and annual returns to cease business operations. These changes are part of the government’s efforts to speed up the process of closing down companies.

Under the new rules, a company cannot file for the removal of its name unless it has filed overdue financial statements and annual returns up to the end of the financial year in which it ceased to operate.

In case a company intends to file the application after the action has been initiated by the Registrar, it will have to file all pending financial statements and annual returns prior to this. These changes have been introduced to ensure that such firms remain accountable and responsible for their actions.

The Notification dated 10th May, 2023 in F. No. 1/28/2013-CL-V(Part-III) states as follows:

“These rules may be called the Companies (Removal of Names of Companies from the Register of Companies) Second Amendment Rules, 2023.

They shall come into force on the date of their publication in the Official Gazette.

In the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 (hereafter referred to as the principal rules), in rule 4, in sub-rule (1), the following provisos shall be inserted, namely:-

“Provided that the company shall not file an application unless it has filed overdue financial statements under section 137 and overdue annual returns under section 92, up to the end of the

financial year in which the company ceased to carry its business operations:

Provided further that in case a company intends to file the application after the action under subsection (1) of section 248 has been initiated by the Registrar, it shall file all pending financial

statements under section 137 and all pending annual returns under section 92, before filing the

Application:

Provided also that once notice under sub-section (5) of section 248 has been issued by the Registrar for publication pursuant to the action initiated under sub-section (1) of section 248, a company shall not be allowed to file the application under this sub-rule”.

To Read the full text of the Order CLICK HERE

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