A private limited company is an artificial judicial person and requires various compliances like appointment of Auditor, regular filing of income tax return, annual return filing and more. Failing to maintain compliance for a Company could result in fines and/or debarment of the Directors from incorporating another Company. Therefore, if a private limited company has become inactive and there are no transactions in the company, then it is best to wind up the Company. To enable inactive private limited companies to quickly close or wind up, the Ministry of Corporate Affairs has introduced Fast Track Exit Mode - an easier way to close inactive companies at a cheaper cost with lesser formalities. A defunct company which has not carried out any business activity or operations for last one year or since incorporation and having NIL assets & liability can apply for stricking-off of name under the Fast Track Exit Mode. Monitrix can help you wind up your Company quickly and easily.
Reasons to Winding Up of a Company
A company is a legal entity and a juristic person established created under the Companies Act. Therefore, a company required regular maintenance of Compliance throughout its lifecycle. Fast track exit used can be used close a company that is not active and avoid compliance responsibilities
Fast to Close
A company can also be closed under the fast track exit scheme quickly in about 90 days, whereas traditional methods take longer and are more cumbersome. Hence, closing a company under fast track exit scheme is faster and easier.
A company that doesn't file its compliance on time incurs fines and penalty including debarment of the Directors from starting another Company. Hence, it is better to officially wind up a company that is inactive and avoid potential fines or liabilities in the future.
When compared to maintaining compliance for a dormant company, it might actually be cheaper to wind up a company and incorporate again when the time is right. Monitrix can help you wind up a company starting from just Rs.25000 all inclusive fee.
Easy to Close
The fast track exit scheme was specifically introduced by the Government to make it easy for inactive companies that have NIL assets and liabilities to close down or wind up. Hence, the formalities for winding up of a company under fast track exit scheme is easy to complete.
A Business Expert reviews the activities of the Company and determines if it is eligible for winding up under the Fast Track Exit Mode. The review process would be complete in 2 - 3 working days.
2. Document Preparation
The necessary documents are prepared by an Expert for winding up of the company under the Fast Track Exit Mode. Documents will be prepared by the Expert in 10 - 15 working days depending on the Company.
3. Winding Up Application
fast Track Exit application along with the necessary documents are submitted to the MCA. MCA will usually approve the application for winding up and closing of the company in about 90 days, subject to processing time.
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