Dormant company- Section 455- company Act 2013

Companies ( Miscellaneous ) Rules 2014, notified on 31 march 2014 and came into force 1st April 2014

in simple word Dormant company means Inactive company , means which is an inactive company in the record of Register of companies (ROC) which is not carried out any business activities as of now but intention to work on near future , For this he need to status of dormant company from Roc .

WHO CAN BE INACTIVE COMPANY ?

  • Both New and Existing company can be inactive company
  • Who has not Fulfill compliance last two years
  • Not done any Significance accounting transaction
  • Nither file AOC-4 nor MGT-7 last two years.

NOTE : During inactive status if do significance accounting transaction by mistake then The status of inactive can be withdrawn and granted active status .

WHAT IS SIGNIFICANCE ACCOUNTING TRANSACTION ?

  • Payment for maintaining office and records.
  • Fees to Roc ( if DIR-12 Filled)
  • Payment for compliance to professionals
  • Allotment of shares to its subscribers

Note : if dormant company violated the provision of section 455 of companies act 2013 …. . ROC convert the company inactive to Active

HOW DORMANT STATUS CAN BE AVAILED
  • Apply by company suomoto : in MSC-1 along with prescribe fees under companies (registration office and fees) rules 2014 apply to ROC
  • ROC self : ROC also give status of dormant company if AOC-4 and MGT-7 not filled within time limit last two years.

NOTE : AOC-4 for Annul accounts file within 30days from the date Annual general meeting

MGT-7 for Annual Returns file within 60days from the date of Annual general meeting .

NOTE : AOC-4 for Annul accounts file within 30days from the date Annual general meeting

EXEMPTION TO DORMANT COMPANY
  • only two board meeting can be conducted
  • no require to cash flow statement
  • Rotation of Auditors also not required
  • low statutory compliance cost
  • Enjoy dormant status for 5 years
COMPLIANCE BY DORMANT COMPANY
  • Minimum director number to be maintained
  • MSC-3 is required to file as returns
  • Returns to ROC (casual returns)
  • At least two board meeting is required to be conducted by dormant company as per section 173(5)
  • one board meeting in each half of financial year

MSC1 : Application for demanding inactive status from ROC

MSC2 : ROC grant status of inactive / dormant to applicant company

MSC3 : Annual compliance for inactive company

MSC4 : company request to roc for active status

MSC5: ROC grant active status to company

MSC6: ROC strikeoff or delete the name of company from register of dormant companies.

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