Quick Summary
Dormant Company is a company that is inactive and has no significant accounting transactions. It can obtain "Dormant" status to reduce compliance burden.
Dormant Company is defined under Section 455 of the Companies Act, 2013. It is a company formed and registered for a future project or to hold an asset or intellectual property but has no significant accounting transaction.
Eligibility
- No significant accounting transaction for 2 consecutive FYs
- Has not filed financial statements/annual returns for 2 FYs
- Not carrying on any business or operation
- No outstanding statutory dues
- No pending litigation
Application Process
- Hold Board Meeting and pass resolution
- Obtain NOC from creditors (if any)
- File Form MSC-1 with ROC
- ROC issues certificate in Form MSC-2
- Company status changed to "Dormant"
Compliance for Dormant Companies
- File MSC-3 (Return of Dormant Company) annually
- Minimum 4 Board Meetings per year (reduced compliance)
- Maintain minimum number of directors
- File annual return (simplified)
Reactivating Dormant Company
- File Form MSC-4 for active status
- ROC issues MSC-5 certificate
- Company becomes active again
- Full compliance requirements apply
Benefits
- Reduced compliance burden
- Lower filing fees
- Preserve company name
- Retain corporate structure for future use
Key Points
- Inactive company status
- Reduced compliance burden
- File MSC-1 to obtain status
- File MSC-3 annually
- Can be reactivated anytime