Cancellation of Registration of a Company

Upon the application made by a Company 

Companies may choose to cancel their registration by submitting an application to Office of Company Registrar (OCR) upon failure to commence the business of a company. 

Conditions :

1. If company is in operation then the company cannot file an application for cancellation of registration stating failure to commence the business. Such company shall follow voluntary liquidation or insolvency proceedings.
2. If there are more than one shareholder in the company then the shareholders holding at least 75%of shares shall give approval for such application. 

Required Documents:

1. Minutes for cancelation of registration of a company passed by Special General Meeting of a company.
2. Letter addressed to OCR for cancelation of registration of a company approval. 
3. Auditor’s declaration or statement that acts as evidence that the company has not been running its business.
4. Director’s declaration that acts as evidence that the company is not liable to pay to anyone and has not been running its business.

Procedure:

1. OCR shall publish a notice in regard to cancelation of registration in a national daily newspaper within 15 days from the date of application
2. If anyone files written application specifying the reasons why the registration of a company should not be canceled backed by the evidences, then it should be done within 35 days from the date of publication of notice. 
3. If no application is made within 35 days, or despite of making an application, the reasons specified are found to be unreasonable then, OCR shall cancel the registration of such company.
4. OCR shall give information about the cancelation of registration by publishing it in a national daily newspaper.

Upon the process initiated by OCR

OCR has right to cancel the registration of a company if any of the following conditions exist, accompanied by the prescribed fees:

Conditions :

1. If company fails to submit annual returns to OCR or fails to pay fines imposed as a defaulter in submitting any of the returns on time consecutively for three financial years.
2. If OCR receives reasonable grounds to believe that the company is not carrying out its business or the company is not in operation till date.            

Required Documents

1. Minutes for cancelation of registration of a company passed by Special General Meeting of a company.
2. Letter addressed to OCR for cancelation of registration of a company approval. 
3. Auditor’s declaration or statement that acts as evidence that the company has not been running its business.

Procedure

1. If registration of a company is to be cancelled by OCR, then OCR shall serve a notice to the company stating reasons for canceling of registration of a company prior to making any decisions in that regard.
2. As per the necessity, OCR shall publish such notice in a national daily newspaper.
3. If company fails to make an application specifying the reasons why the registration of a company should not be canceled, within two months of receiving such notice, or despite of making an application, the reasons specified are found to be unreasonable then, OCR holds the right to cancel the registration of such company.
4. OCR shall give information to the company upon the cancelation of registration and publish it in a national daily newspaper.

Company liabilities upon the Cancelation of Registration

1. If there are any benefits, assets, rights or liabilities of a company at the time of cancelation of registration of a company then, such shall be transferred to its officers or shareholders based on the proportion of their shareholdings and nothing shall prevent company’s personnel from fulfilling those liabilities.

Note: the property/assets acquired by the company as a result of trusteeship in favor of another person, shall not be transferred to the rights and ownership of the shareholders.

1. If any debt or liability to be discharged by the company cannot be settled from assets, rights, or benefits transferred to the shareholders then, the shareholders, directors or officers who were involved in the management of such company and responsible for giving rise to the situation of cancelation shall personally bear such remaining loan or liability of the company.
2. If there remains any property or assets after deducting the expenses incurred in the cancelation of registration then OCR shall give such property or assets to the shareholders. 

Note: Company shall not operate any business activities in the name of a same company whose registration has been canceled.