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2,395 companies shut down in Delhi in Apr 2020-Feb 2021; 1,936 in UP, 1,322 in Tamil Nadu

Joe C Mathew     March 9, 2021

India saw 10,113 companies shut down operations officially during the April 2020 - February 2021 period, Ministry of Corporate Affairs (MCA) data has revealed. Delhi, with 2,394 shutdowns fared the worst. Uttar Pradesh (1,936), Tamil Nadu (1,322) and Maharashtra (1,279) saw a large number of companies shut down during the Covid-19 lockdown and subsequent period.

Incidentally, Gujarat saw only 17 companies get their names struck off from the ministry registers during the period. Haryana did not figure in the list at all.

In a written reply to a query from a Lok Sabha member over the details of the number of registered companies that went out of business during the year 2020-2021, the ministry said that 10,113 companies during the year 2020-2021 (from the month of April 2020 to February 2021) were struck off under section 248 (2) of the Companies Act, 2013. The ministry also clarified that it did not run any drive to strike off companies' suo moto during this period.

Benny Behanan, a Congress MP from Kerala, had sought the details. The ministry said it does not maintain any record of the companies which have gone out of business but only administers the Companies Act, 2013 and maintains the registry of companies on the basis of documents and applications filed.

The MP had also sought details of the measures taken by the government to encourage new companies in the country. In its response, the ministry highlighted two notifications - incentivising the incorporation of One Person Company and changing the definition of small companies - as its major recent initiatives. While a notification on February 1, the Companies (Incorporation) Second Amendment Rules, 2021, incentivised the incorporation of One Person Companies (OPCs) another notification on the same day, the Companies (Specification of Definitions Details) Amendment Rules, 2021, amended the definition of small companies to increase the paid up capital and turnover to Rs 2 crore and Rs 20 crore respectively, in place of the earlier limit of Rs 50 lakh paid up capital and turnover of Rs 2 crore for the small companies. Both the notifications are to be effective from April 1, 2021.

Here is the complete list of states that saw companies getting shut down from the month of April 2020 to February 2021:

  • Delhi - 2,394
  • Uttar Pradesh - 1,936
  • Tamil Nadu - 1,322
  • Maharashtra - 1,279
  • Karnataka - 836
  • Chandigarh - 501
  • Rajasthan - 479
  • Telangana - 404
  • Kerala - 307
  • Jharkhand - 137
  • Madhya Pradesh - 111
  • Bihar - 104
  • Meghalaya - 88
  • Odisha - 78
  • Chattisgarh - 47
  • Goa - 36
  • Puducherry - 31
  • Gujarat - 17
  • West Bengal - 4
  • Andaman & Nicobar - 2
  • Total - 10,113

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Also read: Large companies 'cannibalising' markets of small companies post-Covid: CMIE

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