Not every company that stops working gets closed properly. Many just sit there, racking up penalties year after year, because nobody explained how to close a private limited company the right way. There are actually two very different routes depending on your company's situation, and picking the wrong one wastes months.
Most guides treat closure as one single process. That's not accurate. A company with no assets and no debts closes through a fast strike-off. A company with pending contracts, dues, or assets to distribute has to go through formal winding up instead, and the two are nothing alike in cost or time.
This guide breaks down both routes clearly, using the current 2026 process through the Centre for Processing Accelerated Corporate Exit (C-PACE), the documents each route needs, realistic costs and timelines, and what happens to directors and tax records after closure. At LegalDev, we handle company closures regularly, so this reflects what we actually see happen at the ROC stage, not just the textbook version.
To close a private limited company in India, first check if it has zero assets and liabilities. If yes, file for voluntary strike-off under Section 248 through Form STK-2 with C-PACE, a process that takes three to six months and costs roughly ₹15,000 to ₹40,000. If the company still has assets or creditors, it must go through formal winding up instead, under Sections 271 to 365, with a liquidator appointed to settle dues before dissolution.
That's the short version. The rest of this guide covers each step, cost, document, and edge case in detail.
This is the first decision, and getting it wrong means starting over months later.
Strike-off under Section 248 of the Companies Act, 2013 removes a company's name from the register when it has zero assets and zero liabilities. Winding up under Sections 271 to 365 is a formal, court-supervised process used when a company has assets to distribute or creditors to pay. Most small, inactive private limited companies qualify for strike-off, which is faster and cheaper.
If your company never really operated, has no pending dues, no employees to settle, and no assets on its books, strike-off is almost always the better route. If there are creditors waiting to be paid or assets that still need to be sold and distributed, winding up is the only legally correct option.
This is the process most small, dormant, or never-started private limited companies use. It's handled entirely through C-PACE now, not individual ROC offices.
Who Qualifies for Strike-Off
Step by Step: How Strike-Off Works
Since C-PACE took over in May 2023, this process typically takes three to six months, down from what used to stretch past a year under the older, decentralised ROC system.
Winding up is a different animal entirely. It exists for companies that can't simply walk away because there's still money, property, or obligations to settle.
Winding up is the formal process of closing a company that has assets to distribute, creditors to pay, or disputes to resolve. It works through either the National Company Law Tribunal (NCLT) or a voluntary members' resolution, with a liquidator appointed to handle asset sales and creditor settlements. It's used when strike-off isn't legally available.
Voluntary winding up is initiated by the company's own shareholders when the business is solvent but the owners choose to close it. Compulsory winding up happens through the NCLT, usually triggered by inability to pay debts or a tribunal order. Either way, a licensed insolvency professional is appointed as liquidator to handle the process, and it can take anywhere from several months to a few years depending on how complicated the asset and creditor situation is.
The one sentence that decides everything here: if your company owes money or holds assets, you cannot use strike-off, no matter how inactive it has been.
GST cancellation before closing a company means filing Form GST REG-16 to surrender the GSTIN, followed by the final return in Form GSTR-10. It works by formally ending the company's tax registration so the ROC doesn't reject the strike-off during cross-verification. Companies with an active GSTIN almost always face rejection at the ROC stage if this isn't done first.
For a clean, compliant company with no backlog, strike-off through C-PACE usually costs between ₹15,000 and ₹40,000, covering the government fee, CA certification, stamp paper, and professional fees. The government fee for Form STK-2 itself is fixed, but backlog late fees from unfiled annual returns can add significantly more.
On timing, budget three to six months for strike-off if your filings are current. If there's a backlog of pending AOC-4 or MGT-7 filings, add extra time to clear that first, since the ROC won't accept a strike-off application with pending returns.
In one line: strike-off costs less and moves faster than winding up, but only if the company has zero assets, zero liabilities, and clean filings going in.
Once Form STK-7 is issued for a strike-off, or the final dissolution order comes through for winding up, the company is legally dissolved. It can no longer sign contracts, hold a bank account, or operate in any form.
Directors still remain personally liable for any dues or claims that existed before closure. Any assets not distributed before a strike-off vest with the Central Government under Section 250. A struck-off company can be revived through the NCLT under Section 252, within twenty years for a voluntary strike-off or three years for a compulsory one, if there's valid grounds.
Here's roughly what closure looks like for a common situation, a private limited company that stopped operating two years ago and has no debts.
Week 1-2: We check eligibility, confirm zero assets and liabilities, and identify any pending AOC-4 or MGT-7 returns that need filing first.
Week 3-6: Backlog returns are filed if needed, GST is cancelled, and the bank account is closed with confirmation obtained.
Week 7-8: Board resolution, special resolution, CA-certified nil statement, STK-3, and STK-4 are all prepared and signed.
Week 9-10: Form STK-2 is filed with C-PACE.
Week 11-14: C-PACE reviews the application and publishes the STK-6 public notice, opening the 30-day objection window.
Month 4-5: If there are no objections, Form STK-7 is issued and the company is officially dissolved.
A company with pending filings or an active GST registration adds a few extra weeks upfront, but the overall shape of the timeline stays the same.
Closing a company properly means sequencing the ROC filing, GST cancellation, and final tax return correctly. Get the order wrong and the application usually gets rejected, costing weeks of delay.
"The applications we see rejected almost always have one small thing out of order, an active bank account, a GST number still live, or a return filed a year late. None of it is complicated. It just needs to happen in the right sequence."
We handle this as a single package rather than charging separately for each filing, so nothing gets missed along the way.
If your company needs winding up instead of strike-off, we coordinate the liquidator appointment and NCLT filing as part of the same engagement, so you deal with one point of contact throughout.
Every month a company stays open without proper closure adds another year of pending compliance, more late fees, and more risk to your director status. There's no upside to waiting.
Get in touch with LegalDev for a free eligibility check. We'll tell you honestly whether your company qualifies for the fast strike-off route or needs winding up, what documents you already have versus what's missing, and a clear cost estimate before you commit to anything.
Contact LegalDev now to start your company closure the right way, with a team that files these applications every month and knows exactly what gets an application accepted on the first try.
Strike-off is for companies with zero assets and liabilities, it's faster and cheaper. Winding up is a formal process for companies with assets to distribute or creditors to settle.
Strike-off through C-PACE usually takes three to six months. Winding up can take anywhere from six months to a few years depending on complexity.
Not through strike-off. All liabilities must be zero for that route. If there are dues, either settle them first or go through winding up instead.
The standard fee is ₹10,000, though discounts sometimes apply under special MCA schemes, so it's worth checking current rates before filing.
It's not written directly into the Companies Act, but an active GST registration almost always causes rejection during ROC cross-verification, so it should be cancelled beforehand.
No. The PAN stays with the Income Tax Department. The company's final return still needs to be filed to avoid future notices.
Yes, through the NCLT under Section 252, within twenty years for voluntary strike-off or three years for compulsory strike-off, given valid grounds.
Yes, for any dues or claims that existed before closure. Closure doesn't erase liability for past obligations.
No. Section 8 companies must apply to the Central Government for surrender of licence, which involves a more detailed process, usually through the NCLT.
Yes. LegalDev handles the eligibility check, resolutions, CA certification, GST cancellation, final tax return, and the STK-2 filing through to dissolution, or coordinates the liquidator and NCLT filing if winding up is the correct route instead.
Getting this sequence right the first time saves months of back and forth with the ROC. If you're ready to close your private limited company, LegalDev can manage the entire filing from board resolution to final dissolution.