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Dormant Company Status MSC-1 and MSC-3

Dormant company status lets a company with no significant accounting transactions stay on the register, with its name preserved, by applying to the Registrar in Form MSC-1 under Section 455 of the Companies Act, 2013. It does not remove every compliance: an MSC-3 return is filed every year. StampMitra prepares the resolution papers and files MSC-1 for you.

What dormant status is and the law behind it

Section 455 of the Companies Act, 2013 lets a company that was formed for a future project, or to hold an asset or intellectual property, and has no significant accounting transaction, apply to the Registrar of Companies for dormant status. An "inactive company", with no business or no significant transaction in the last two financial years, or with no financial statements or annual returns filed for two years, may also apply.

Who can apply and on what conditions

Rule 3 sets the conditions. We check them before you apply.

  • No inspection, inquiry or investigation pending
  • No prosecution pending
  • No outstanding public deposits or default
  • No outstanding statutory dues, no workmen's dues default
  • No listed securities
  • Approval by members

Dormant status, strike-off and default are different things

Choose on purpose.

  • Dormant status
  • Strike-off
  • Inactive filer in default

Government fees in the dormant process

The special resolution is filed in MGT-14, which has its own fee.

  • MGT-14 (special resolution), by nominal share capital below ₹1 lakh: ₹200
  • MGT-14, ₹1 lakh to under ₹5 lakh: ₹300
  • MGT-14, ₹5 lakh to under ₹25 lakh: ₹400
  • MGT-14, ₹25 lakh to under ₹1 crore: ₹500
  • MGT-14, ₹1 crore or more: ₹600
  • MSC-1 application: We confirm the exact amount before filing

Documents for MSC-1

The same set applies to private, public and one person companies.

  • Special resolution and MGT-14 receipt
  • Board resolution and notice of the general meeting
  • Statement of Affairs
  • MoA and AoA
  • Latest financial statements and annual return
  • Director declarations

How the dormant application and annual return work

From the first Board meeting to the yearly MSC-3.

Find your MGT-14 deadline

Enter the date the special resolution was passed.

Dates and conditions while the company is dormant

Dormant status does not remove income tax obligations. Whether AOC-4 and MGT-7 are also due is something we confirm with your CA for your company.

  • MGT-14: Within 30 days of passing the special resolution
  • MSC-3 annual return: Within 30 days of the end of each financial year, so by 30 April (Rule 7)
  • Directors: At least 3 for a public company, 2 for a private company and 1 for an OPC (Rule 6)
  • Board meetings: Section 173(5): one meeting in each half of the calendar year, with a gap of 90 days, is treated as compliance
  • Permitted payments: Fees to the Registrar, legal payments, allotment of shares and maintaining the office
  • Five consecutive years dormant: The Registrar initiates striking off (Rule 8)

What can go wrong

Pending prosecution, inspection or statutory dues, which block the application.

  • Pending prosecution, inspection or statutory dues, which block the application.
  • A Statement of Affairs not certified by a practising CA, or built on old financials.
  • The resolution does not reach three-fourths, or MGT-14 was not filed.
  • Listed securities or outstanding public deposits.
  • The wrong capital band, which gives the wrong fee.
  • Significant business transactions while dormant: the Registrar can treat the company as active after an inquiry (Rule 8).

What StampMitra does for you

StampMitra is a filing assistance platform. It is not the government and not a law firm.

  • Meeting papers
  • MGT-14 and MSC-1
  • Auditor coordination
  • Annual MSC-3

How it works

  1. Meet and give notice The Board meets and issues a notice of the general meeting.
  2. Pass the special resolution Pass it, or take three-fourths consent by value, and file MGT-14 within 30 days.
  3. Certify the Statement of Affairs A practising CA certifies the Statement of Affairs.
  4. File MSC-1 File MSC-1 on MCA21 V3 with attachments and fee, and receive MSC-2.
  5. File MSC-3 yearly File MSC-3 within 30 days of the end of each financial year.

Frequently asked questions

Can a dormant company do business?

No. It has no significant accounting transactions. Permitted payments are fees to the Registrar, legal payments, allotment of shares and maintaining the office.

Which forms are involved?

MGT-14 for the special resolution, MSC-1 for the application, MSC-2 as the certificate, MSC-3 every year, and MSC-4 with MSC-5 to become active again.

What approval does the company need?

A special resolution at a general meeting, or the consent of members holding three-fourths by value given on notice (Rule 3).

When is MSC-3 due?

Within 30 days of the end of each financial year, so by 30 April for a 31 March year-end (Rule 7).

How many board meetings are needed?

Section 173(5) treats one meeting in each half of the calendar year, with a gap of 90 days between them, as compliance.

Do dormant companies still file tax returns and ROC returns?

Income tax obligations continue. MSC-3 is the annual ROC return of a dormant company, and whether AOC-4 and MGT-7 are also due is something we confirm with your CA.

Can we become active again?

Yes. File MSC-4 with a current-year MSC-3, and the ROC issues MSC-5.

What if we have filed nothing for two years?

The Registrar may enter the company in the dormant register or begin strike-off. Do not rely on this as a way to become dormant.

Can a listed company be dormant?

No. Rule 3 does not allow it.

How many directors must a dormant company have?

At least 3 for a public company, 2 for a private company and 1 for an OPC (Rule 6).