What Is The Process For Dissolving A Section 8 Company?

Dissolving a Section 8 Company in India

1. Board Resolution: To dissolve a Section 8 Company, start by holding a board meeting. The board should pass a resolution for voluntary dissolution, requiring a majority director's approval.

2. Members' Approval: Following the board resolution, a special resolution must be passed at a general meeting, with a three-fourths majority of members present and voting for approval.

3. Application to the Tribunal: Once the special resolution is passed, file a dissolution application with the NCLT, including essential documents like special and board resolutions, directors' solvency declaration, and asset/liability details.

4. Notice to Creditors: Following the NCLT application, advertise dissolution notice and inform creditors; they can object within a set timeframe.

5. NCLT Approval: NCLT reviews applications and objections; if satisfied with compliance and creditor protection, it grants dissolution approval.

6. Transfer of Assets: Before final dissolution, transfer assets to another Section 8 Company or registered charity with similar goals, ensuring assets benefit charitable causes.

7. Cancellation of Registration: After NCLT approval, apply for registration cancellation with ROC; a dissolution certificate will be issued upon completion of formalities.

8. Publication of Notice: The company should publish a notice of its dissolution in the Official Gazette and other prescribed publications.

9. Final Compliance: Following the dissolution, the company must complete any remaining compliance requirements, such as filing final tax returns, settling outstanding liabilities, and submitting necessary documents to the ROC.

10. Handover of Records: The company should maintain its records and documents for the prescribed period and make them available to relevant authorities if required.