Dormant Status Filing — Form MSC-1

Q: What qualifies as a significant accounting transaction?

Any commercial transaction — sales, purchases, loans, or professional fees — qualifies. Only ROC fee payments, statutory payments, share allotments under the Act, and registered office maintenance costs are excluded.

Q: Can a company with outstanding bank loans apply for dormant status?

No. All outstanding secured and unsecured loans must be fully repaid before applying. The MSC-1 requires a director declaration confirming no outstanding liabilities.

Q: What are the compliance obligations of a dormant company?

A dormant company must hold 2 Board Meetings per year, file MSC-3 within 30 days of year-end, maintain minimum directors, and refrain from significant accounting transactions.

Q: Is a dormant company required to have its accounts audited?

Yes. Audited financial statements must be prepared and filed with MSC-3. The auditor confirms no significant transactions occurred during the year.

Q: What happens if a dormant company exceeds the 5-year dormancy period?

The company must either restore active status via MSC-4 or apply for voluntary strike-off. The ROC may revoke dormant status for non-filing or disqualifying transactions.

Complete Guide to Obtaining Dormant Company Status Under Section 455 of the Companies Act, 2013

A company that has been incorporated for a future project or holds an asset or intellectual property with no significant accounting transactions may apply to the Registrar of Companies (ROC) to obtain the status of a Dormant Company under Section 455 of the Companies Act, 2013. Dormant status reduces the compliance burden significantly — a dormant company files a simplified annual return in Form MSC-3 instead of the full AOC-4 and MGT-7, and is not required to hold four Board Meetings per year.

Obtaining dormant status is particularly useful for holding companies, special purpose vehicles (SPVs), or companies incorporated in advance of a planned business activity. Our services cover the complete dormant status application — from eligibility assessment and Form MSC-1 preparation to obtaining the ROC's certificate of dormant status and managing the ongoing simplified compliance obligations.

Our Dormant Status Filing Services

Eligibility Assessment

Review of the company's transaction history, filing status, outstanding liabilities, and pending litigation to confirm eligibility for dormant status before initiating the MSC-1 application.

MSC-1 Application Filing

Preparation and filing of Form MSC-1 on the MCA21 portal with required attachments — including audited financial statements, director declarations, and statements confirming no pending investigations.

Special Resolution Management

Drafting of the Special Resolution required for dormant status application, EGM management, and filing of Form MGT-14 with the ROC after passing the resolution.

Dormant Annual Filing (MSC-3)

Filing of the annual return for dormant companies in Form MSC-3 — which is significantly simpler than the standard AOC-4 and MGT-7 — within 30 days of the financial year end.

Revival to Active Status

Assistance with filing Form MSC-4 to restore a dormant company to active status when the company wishes to resume business operations — including updating all filings and compliance records.

Compliance During Dormancy

Ongoing compliance support for dormant companies — including maintenance of minimum board requirements, monitoring the 5-year dormancy limit, and ensuring no disqualifying transactions occur.

Key Facts About Dormant Status

A dormant company must have no significant accounting transactions in the two preceding financial years
The application is made in Form MSC-1 after passing a Special Resolution at a General Meeting
A dormant company need only hold a minimum of one Board Meeting per half-year (2 per year) instead of 4
The annual return for dormant companies is filed in simplified Form MSC-3 within 30 days of the financial year end
A company cannot obtain dormant status if it has pending litigation, outstanding public deposits, outstanding loans, or pending investigations
Dormant status can be maintained for a maximum of 5 consecutive years — after which the company must resume active status or apply for strike-off
A dormant company can be restored to active status at any time by filing Form MSC-4 with the ROC

Frequently Asked Questions

What qualifies as a "significant accounting transaction" for dormant status?

Under Section 455, a significant accounting transaction means any transaction other than: (1) payment of fees to the ROC; (2) payments made to fulfil requirements under the Companies Act; (3) allotment of shares to fulfil requirements under the Act; and (4) payments for maintenance of the registered office and statutory records. Any commercial transaction — sales, purchases, loan receipts or repayments, professional fees paid or received — would be a significant accounting transaction that disqualifies a company from dormant status.

Can a company with outstanding bank loans apply for dormant status?

No. A company with secured or unsecured outstanding loans from banks, financial institutions, or any other creditors is not eligible for dormant status. Before applying, the company must ensure all outstanding borrowings and public deposits are fully repaid. The MSC-1 application requires a declaration from the directors confirming the absence of outstanding liabilities, and the ROC will reject the application if any outstanding debt is detected from the company's financial statements or MCA filings.

What are the compliance obligations of a dormant company?

A dormant company must: (1) hold at least one Board Meeting in each half of the calendar year (minimum 2 per year); (2) file the annual return in Form MSC-3 within 30 days of the end of each financial year; (3) maintain a minimum of 3 directors (for a private company — minimum 2); (4) maintain its registered office; (5) pay the ROC annual filing fee; and (6) refrain from conducting any significant accounting transactions. Failure to file MSC-3 or falling into disqualifying transactions terminates dormant status.

Is a dormant company required to have its accounts audited?

Yes. Even a dormant company must prepare financial statements for each financial year and have them audited by a statutory auditor. The audited financial statements are filed as part of the MSC-3 return. However, since a dormant company has no significant transactions, the audit is simpler and less time-consuming than for an active company. The auditor must confirm that no significant accounting transactions have taken place during the year.

What happens if a dormant company exceeds the 5-year dormancy period?

A company cannot remain in dormant status for more than 5 consecutive years. Before the 5-year limit expires, the company must either: (1) file Form MSC-4 to restore active status and resume normal compliance obligations; or (2) apply for voluntary strike-off under Section 248 if it no longer intends to carry on business. The ROC may revoke dormant status and treat the company as an active company if it fails to file MSC-3 annually or if it conducts significant transactions during the dormancy period.

Apply for Dormant Status — Reduce Your Compliance Burden

Expert assistance with MSC-1 filing, Special Resolution management, and ongoing dormant company compliance.