Restoration and Compliance Matters
Bringing a Struck-Off Company Back

A struck-off company has not been dissolved by choice. In most cases the directors did not decide to close it — filings stopped, notices went to an address nobody was reading, and the Registrar removed the name from the register under Section 248. The company then ceases to exist as a legal person, its bank accounts freeze, and whatever it owned becomes very difficult to deal with.

The problem usually surfaces years later and at the worst moment: a property sale that needs the company as a signatory, a bank balance nobody can access, a customer asking for a certificate of incorporation, or a director discovering they are disqualified across every company they are involved in. By then the strike-off is old news and the remedy is a Tribunal application.

N D Savla & Associates handles restoration and the compliance backlog that comes with it for companies across Mumbai, Navi Mumbai, Thane and Goa. We assess whether restoration is worth pursuing, assemble the evidence of operation, draft and file the Section 252 application, and complete the outstanding filings the order will require. Where a director is disqualified, we deal with that alongside rather than afterwards.

Section 248 of the Companies Act, 2013 gives the Registrar power to remove a company's name from the register in defined circumstances, and to do so on the Registrar's own motion after issuing notice.

The grounds are:

• The company has failed to commence business within one year of incorporation
• The company has not been carrying on any business or operation for two immediately preceding financial years and has not applied for dormant status
• The subscribers to the memorandum have not paid the subscription they undertook, and no declaration to that effect has been filed within one hundred and eighty days
• The company is not carrying on any business or operation, as revealed after physical verification of the registered office

A company may also apply voluntarily under Section 248(2) through Form STK-2, after extinguishing its liabilities and passing a special resolution. That route is deliberate and produces a clean outcome. The involuntary route rarely does, because the company generally learns of it after the fact.

The current framework, and the volume of restoration work it generates, is the direct result of a specific enforcement episode.

Under the Companies Act, 1956, Section 560 empowered the Registrar to strike off the name of a defunct company. The power existed but was exercised sparingly, and the register accumulated a large population of companies that had stopped operating without ever being formally closed.

The Ministry attempted to clear the backlog through amnesty rather than enforcement — the Easy Exit Scheme in 2010 and 2011, and the Fast Track Exit mode in 2011. These reduced the numbers but did not change the underlying dynamic, because a company that simply stopped filing faced no immediate consequence.

The Companies Act, 2013 restated the striking off power in Section 248 and created a legitimate middle position: Section 455 introduced dormant company status, allowing a company with no significant accounting transaction to remain on the register on a reduced compliance footing. The Act also introduced Section 164(2), attaching disqualification to directors of companies that failed to file for three continuous financial years — shifting the consequence from the entity to the individual.

Enforcement changed abruptly after 2016. Following demonetisation and the resulting focus on shell companies, the Ministry of Corporate Affairs struck off more than two lakh companies during 2017 and 2018 for prolonged non-filing, and disqualified directors on a very large scale under Section 164(2). This generated a substantial body of litigation: restoration applications, disqualification challenges, and writ petitions on retrospective application and the absence of a hearing before deactivation.

The government's response combined enforcement with structured relief: the Condonation of Delay Scheme, 2018 for disqualified directors, and the Companies Fresh Start Scheme, 2020 providing a broader immunity window. Amendment Acts in 2019 and 2020 decriminalised a large body of procedural defaults, moving them to civil adjudication under Section 454. More recently, the Companies Compliance Facilitation Scheme, 2026 has eased the transition of annual filings onto the V3 platform.