Closing a Pvt Ltd company in India

startupindia
windingup
closing
audit

#1

Dear Sir,

We have incorporated a Pvt Ltd company in the year 2014 with all valid documents and other mandatory requisites such as Current account,PAN and since then no business was done . Even we never opted for tax return as there was not a single business transaction took place

Recently one of my friend told me that it is mandatory to close a company which is not in function.

Please let me know is it really needed to close a non functional company as I have read some reviews online where I have seen no functional companies automatically get closed after 5 years .


#2

What about Official expenses of the Directors /Board of directors ?
Also have you maintained the Books to include Assets (Computers, Stationary, Machinery) , including Year on Year Deprecation for these assets, and Expenditures(Conveyance, Incorporation expenses, Loans from Directors)
Even if you dont have business, such activities will find its way into the Balance Sheet.
If your intention is to revive a sick company, i can put you through to people who can help you, but i need to understand your case first.
Please DM if interested.


#3

Hi,

Thanks for your reply.

As there was not a single business transaction took place

  1. We never got our account audited/ never kept any record
  2. Never filed financial reports with MCA
  3. Never filed IT return

Please let us know

  1. what would be the best option to opt for?
  2. Is there any problem if we leave it non functional?

#4

It’s better to close the close the company in a formal way. It may avoid problems that may come in future.


#5

The best option is in any ways to identify a good Company Secretary to either revive the firm, restore the books or close the company down as non-functional.


#6

Hi,

Even I’ve a company which is non functional.

We have all the documents, Current account and PAN card also

We have started a Pvt. Ltd. company and worked for couple of month’s but there is no revenue so we have closed but not officially.

There is no transaction in our companies bank account.

There are 2 partners holding 50% each

but the person who is having signing authority is not available and not at all interested to do anything

  1. What I have to do if we need to close it?
  2. What if I want to continue alone or inviting another partner?
  3. What is the best option to do now?

#7

What is the area of operations of your Company ?
Is it a tech startup ?
What are yours and your co-founders skill set ?
How much did you pay for incorporation

this point is not clear, can you DM the board structure.
I can discuss with the CS and get back to you on the options.


#8

Dear Uday,

Best practice will be to formally wind-up the company in case you don’t want to transact any business there.
To wind-up a company, all the necessary filling needs to be completed first.

To introduce myself, I am a practicing CA in Bangalore and help my clients in these situations.
In case of more discussion, I can be reached at +91 88611 86057 and my mail id is manish.dalmia1■gmail.com.

Let me know.

Regards,
Manish Dalmia


#9

Hi,
We are having of CAs and CS. Connect with us. We can help you to closing down the company at very reasonable cost.

Regards
Pankaj Agrawal


#10

Area of Operations : Hyderabad
Yes it is a Tech Startup (for BPO related Projects)
I’m having the experience & skill’s to run the project / campaign’s & my partner / co-founder is just an investor. That is the reason he is having the signing authority.


#11

Most startups that fail on one idea or the other generally PIVOT to another form of the same idea or start on an entirely new idea with the same startup team.

Discuss possible other idea / options with your investor or adding more Associate Directors to your executive board to push the startup through for at least one fiscal as you have taken the pain of incorporating it.

Considering how vibrant the startup ecosystem is in Hyd try finding a suitable co-founder who can help you in getting leads, as you mention you have the required skills and experience to do the projects.

If personal finances are a constraint, try working parttime / contract in a related company /startup untill you can manage the BPO startup independently.
All the best.


#12

Sure Mr. Ron, Thank you Very much for your valuable information.


#13

If your company is not working hen its good to close it down as reviving may incur you cost

i am a practicing company secretary and will help you if you want in the best possible way


#14

I had formed a pvt ltd company but there are no transactions in it. We have a PAN and TAN. But we have decided to close it. I believe there is an easy method to close the company without undergoing winding up procedure. I a, not keen to appoint a CA or CS as they turn out expensive. Not keen to spend on something that I am not going to use.

Can someone tell me the process to close the company?


#15

For more information please send me your contact Via PM.


#16

The procedure for winding up of a company can be initiated voluntarily by the shareholders or forced by a tribunal or a court. We will first dicuss voluntary winding up of a company and later forced closure:

Voluntary Winding Up Of a Company

When Shareholders Can Wind Up A Company
To begin the procedure for winding up a company, the shareholders must:
a) Pass a special resolution in a board meeting
b) In a general meeting, pass a resolution requiring that a company be wound up on account of expiry of a duration specified in the articles of association (AoA) or the meeting of a condition specified in the AoA requiring it to be wound up.

For more info you can PM me.


#18

Closing a company has procedures when it is incorporated to MCA. Look for an extra investor, and also to m knowledge there is no 50 - 50 partnership in PVT companies, its 51 - 49 usually. If the other is holding the 51 % share then, discuss with him to either move forward with the company or to transfer the shares to you so that you can allocate the shares to some new individual interested in the firm.


#20

My company is registered on 25th May 2017 and there is not even a single transaction is happened. I wanted to keep the paid up capital 1 Lakh but my CA kept it 10 Lakhs and he saying that it can not be rectify. I want to shut down this company. Please suggest me the best way to shut it down.