FAST TRACK CLOSURE OF COMPANIES BY USING C-PACE UNDER SECTION 248(2) OF THE COMPANIES ACT, 2013
R V Seckar
MCA has established C-PACE vide notification dated 17th March 2023 having pan-India jurisdiction to process applications for voluntary strike off of companies under Section 248(2) of the Companies Act, 2013 centrally so as to benefit the stakeholders by providing a hassle-free filing, timely and process-bound striking off their company’s name from the Register.
Centre for Processing Accelerated Corporate Exit (C-PACE) has been setup with process reengineering, which has been established to facilitate and speed up the voluntary corporate exit of companies from 2 years to less than 6 months.
After C-PACE implementation , 21372 number of companies have been struck off/dissolved during the period 01.05.2023 to 22.07.2024. Presently, only less than 2000 such applications are pending with the RoC, C-PACE at various stages of processing. The average time taken for processing of such applications has come down to below 90 days.
NOW LLP’s CAN BE CLOSED THROUGH C-PACE
In the budget presented on 23rd July, 2024, the Hon’ble Finance Minister had announced that the Centre for Processing Accelerated Corporate Exit (“C-PACE”) services will be extended to help Limited Liability Partnership (“LLPs”) to have voluntary closure. It is a welcome step taken by the government as a part of its initiative of ease of doing business in India.
Accordingly, the Ministry of Corporate Affairs (“MCA”) has issued a notification No. 475(E) dated 5th August, 2024 introducing Limited Liability Partnership (Amendment) Rules, 2024 (“Amendment Rules“) to further amend the Limited Liability Partnership Rules, 2009 (“LLP Rules”).
Key Benefits of C-PACE for Companies and Stakeholders
The establishment of C-PACE offers several advantages, including:
i) Centralizing the process of striking off companies, which helps maintain a cleaner registry?
ii) Providing hassle-free filing and process-bound striking off for stakeholders.
iii) Ensuring timely and efficient disposal of applications.
iv) Facilitating better availability of meaningful data to stakeholders.
CONCLUSION
The establishment of C-PACE demonstrates the MCA’s commitment to improving the ease of doing business in India. By offering a centralized, transparent and efficient solution for companies seeking to exit the market, C-PACE plays a crucial role in fostering a healthy business environment. With its streamlined processes and commitment to providing stakeholders with meaningful data, C-PACE is set to make a lasting impact on the corporate landscape.
