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DPIIT-recognised startups can wind up under Fast Track Corporate Insolvency Resolution Process (FTCIRP) in 90 days, vs standard 180+ days. A mediator is appointed under IBC. Company's assets are liquidated, creditors paid, directors discharged.
Startup ecosystem · Wind-down
Fast-track winding up: DPIIT startups in 90 days under IBC
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Provisions
Insolvency and Bankruptcy Code 2016, Sec 55-58 | DPIIT Notification
Analysis
When to use: No viable path to revenue. Runway exhausted. Founders want a clean exit without being personally liable for company debts. Key protection: Pvt Ltd shields founders from personal liability for company debts, unless fraud or personal guarantee was given. Founders can walk away from a failed startup.
Close
- File all pending GST returns (returns can't be filed after company struck off)
- Close all bank accounts and clear balances
- File final ITR for the last year of operation
- Discharge all employee dues, TDS, PF obligations
- Board resolution to wind up + shareholder approval
- Inform investors and get NOC if SHA requires it
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