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CS Executive · Company Law and Practice · Dormant Company

Under Section 248 of the Companies Act, 2013, a company that is not carrying on any business and has extinguished all liabilities wants its name removed from the register. Which statement is correct?

The company may apply after extinguishing all liabilities, backed by a special resolution or consent of seventy-five per cent members in terms of paid-up share capital. The Registrar then issues a public notice. A board resolution is not enough, and Section 8 companies are excluded.

  1. AThe company may file an application after a special resolution or consent of 75% members in terms of paid-up share capital, and the Registrar issues a public noticeCorrect
  2. BThe company may apply with a simple majority resolution of the board
  3. CThe Registrar must strike off the name without any public notice
  4. DA Section 8 company is specially entitled to use this route

Explanation

Section 248(2) permits a company, after extinguishing all liabilities, to apply by special resolution or consent of 75% members by paid-up share capital, after which the Registrar causes public notice. A simple board resolution is insufficient. Section 248(3) excludes Section 8 companies from this route.

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