Know about Strike-Off Companies from MCA Records
Why Every Corporate and CA firms takes step to Know about Strike-Off Companies.
In today’s compliance-driven business environment, verifying whether a company is active or struck off has become a critical step for corporates, Chartered Accountants (CAs), financial professionals, and compliance teams. One of the most important checks performed during due diligence is identifying whether a company has been marked as “Struck Off” by the Ministry of Corporate Affairs (MCA). A struck-off company is legally inactive and may have been removed from MCA records due to non-compliance, non-filing of annual returns, prolonged inactivity, or voluntary closure. Engaging with such entities can expose businesses to operational, financial, and compliance-related risks.
Additionally, the Ministry of Corporate Affairs (MCA) mandates disclosure in the audit report regarding whether the company has entered into transactions with companies struck off by the Registrar of Companies (RoC) under Section 248 of the Companies Act, 2013, or Section 560 of the Companies Act, 1956.
Vide this requirement MCA has made it mandatory to disclose the following information:
- Name of the Struck Off Company
- Nature of transaction with the Struck-off Company
- Balance outstanding and relationship with the struck-off the company
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Rising Number of Strike-Off Companies in India (April 2025 – March 2026)
The increasing number of companies being struck off by the Ministry of Corporate Affairs highlights the growing importance of company status verification in India’s business ecosystem. Between April 2025 and March 2026, around 16,749 companies were struck off due to non-compliance, prolonged inactivity, and failure to meet statutory filing requirements.
The rise in strike-off actions emphasizes why corporates, CA firms, financial institutions, and compliance professionals must regularly verify a company’s MCA status before:
- onboarding vendors,
- entering partnerships,
- conducting financial transactions,
- or performing due diligence activities.
A company may appear operational externally while officially marked as struck off in MCA records, creating serious legal, financial, and compliance risks for associated businesses.
The continued increase in strike-off companies also reflects the government’s stronger focus on:
- eliminating shell companies,
- improving corporate transparency,
- strengthening compliance enforcement,
- and maintaining cleaner business records within the Indian corporate ecosystem.
As regulatory monitoring becomes more stringent, proactive strike-off verification is becoming an essential part of modern business risk management and compliance practices.
Top 5 States with Highest Number of Struck-Off Companies
The strike-off data for April 2025 to March 2026 shows that a significant number of companies across various states have been removed from the MCA register due to non-compliance, inactivity, and failure to meet statutory obligations.
Out of a total of 16,749 companies struck off these are the top 5 states with the highest number of struck-off companies:
Maharashtra leads the list, followed by Delhi and Karnataka, indicating a higher concentration of non-compliant and inactive companies in these states. This reinforces the importance of regular compliance monitoring and company verification to mitigate business risk and ensure regulatory due diligence.
Importance of Monitoring Strike-Off Companies
With the Ministry of Corporate Affairs (MCA) mandating disclosures in audit reports regarding transactions with companies struck off by the Registrar of Companies (RoC), monitoring the active status of companies has become an essential compliance requirement for corporates, CA firms, auditors, and compliance professionals.
Verifying whether a company is active or struck off helps businesses:
- ensure proper audit disclosures.
- verify active status of companies.
- strengthen compliance monitoring.
- support due diligence and audit processes.
- identify transactions with struck-off entities.
In today’s business environment, company status verification is no longer an optional step — it has become an essential part of corporate governance, financial risk management, and regulatory due diligence.
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