Dormant company status — pause the compliance, keep the company.
A dormant company is an inactive company that the Registrar has certified under Section 455 of the Companies Act, 2013 — a lawful pause for a company formed for a future project, or to hold an asset.
It keeps its name, CIN and assets — while most of the annual compliance calendar falls away.
Same company, a fraction of the calendar.
Dormancy removes the heavy annual obligations of an active company — the company itself carries on.
| Obligation | Active company | Dormant company |
|---|---|---|
| Annual General Meeting | Required every year | Not required |
| Annual ROC filings | AOC-4 and MGT-7, every year | One form — MSC-3 |
| Board meetings | Four per year, as a rule | Two per year — one in each half |
| Company’s existence | Continues | Continues — name, CIN and assets stay intact |
Some classes of company already enjoy board-meeting relief, so we confirm the exact position for your company before advising.
Four situations where a company can apply as dormant.
Under Section 455, a company can seek dormant status where it is inactive in any one of these positions:
Formed for a future project — with no transactions expected in the foreseeable future.
Formed to hold an asset or intellectual property — again with no transactions expected.
No significant accounting transactions during the last two financial years.
Has not filed financial statements or annual returns during the last two financial years.
Five steps from active to certified dormant.
Five steps through Form MSC-1 — from the board’s first meeting to the Registrar’s certificate.
- i
Board meeting
The board convenes to approve the proposal and issue notice of a general meeting, with the draft special resolution and the explanatory statement under Section 102.
- ii
General meeting — special resolution
Shareholders pass a special resolution authorising the application for dormant status.
- iii
File the resolution
The special resolution is filed with the Registrar.
Form MGT-14 - iv
Apply for dormant status
The application goes to the Registrar with the required attachments — including the auditor’s certificate and the statement of assets and liabilities.
Form MSC-1 - v
Certificate issued
On approval, the Registrar issues a certificate marking the company as a Dormant Company. From here the reduced calendar applies — one annual return, in Form MSC-3.
Certified
dormant
The Registrar’s checklist before MSC-1 is approved.
A company can apply as dormant only if all of these hold:
- ✓No pending inspection or investigation
- ✓No pending prosecution
- ✓No outstanding public deposits
- ✓No outstanding loans
- ✓No management or ownership dispute
- ✓No outstanding statutory dues
- ✓No unpaid workmen’s dues
- ✓Not listed on any stock exchange
An unsecured loan can be allowed with the lender’s concurrence. We check every condition before filing.
Pause, close or sell? Three ways to handle an idle company.
An inactive company can go three ways. The right one depends on whether the company has a future — and whether it has value to someone else.
Keep the company alive at minimum cost
For a company with a future — a planned project, an asset worth holding, a name and vintage worth preserving. Compliance shrinks to a fraction, and the company can return to active status when business begins.
End the company cleanly
For a company with no future use. Strike-off removes it from the register entirely — no further compliance, but no company left to revive without the NCLT. Pending filings and liabilities are cleared first.
Read about strike-off →Exit, with the company intact
For a company with no future for you, but value to someone else — its vintage, registrations or clean compliance record. The shares move to a buyer, the board is reconstituted, and you exit.
Buy or sell a company →Dormancy is a deliberate pause with an expiry, not a place to forget the company exists. A dormant company that stops filing its annual MSC-3 for five consecutive financial years can be struck off by the Registrar. And returning to active status is itself a formal application — in Form MSC-4.
Wondering what the full active-company calendar looks like — the one dormancy replaces? See annual MCA compliance for Companies and LLPs.
What is a dormant company under Section 455?
A dormant company is an inactive company that has applied to the Registrar under Section 455 of the Companies Act, 2013 and been certified as dormant. It covers companies formed for a future project or to hold an asset, and companies with no significant accounting transactions — or no financial statements and annual returns filed — in the last two financial years. Dormant status substantially reduces annual compliance while keeping the company alive.
What are the benefits of making my company dormant?
Four main ones: no Annual General Meeting is required; the annual returns AOC-4 and MGT-7 are not filed; board meetings reduce to two per year (one in each half-year); and the company files just one annual form — MSC-3. The company itself, with its name, CIN and assets, remains fully alive.
Should I make my company dormant, strike it off, or sell it?
Dormant status is a pause — right when the company has a future project, holds an asset, or its name and vintage are worth keeping. Strike-off is a closure — right when the company has no future use. A sale fits when the company has no future for you but value to a buyer. We review your position and advise which fits before any filing. Read about strike-off and buying and selling companies.
Which companies are not eligible for dormant status?
A company cannot apply while any of these exist: a pending inspection, inquiry, investigation or prosecution; outstanding public deposits or defaults on them; outstanding loans (unsecured loans need the lender’s concurrence enclosed with MSC-1); a management or ownership dispute; outstanding statutory taxes or dues; unpaid workmen’s dues; or listing of its securities on any stock exchange in or outside India.
Can a company with an outstanding loan still apply?
Secured loans block the application. For an outstanding unsecured loan there is a built-in route: the company may still apply after obtaining the lender’s concurrence and enclosing it with Form MSC-1. We check every eligibility condition against your actual position before filing — a rejected MSC-1 costs more time than a properly prepared one.
How do I make my company dormant?
Five steps: hold a board meeting to convene a general meeting; pass a special resolution in the general meeting; file the resolution in Form MGT-14; file the application in Form MSC-1 with the auditor’s certificate and statement of assets and liabilities; and receive the Registrar’s certificate marking the company dormant.
Does a dormant company still have any compliance at all?
Yes — a reduced set. The dormant company files the annual MSC-3 return (with its financial position), holds two board meetings a year, and its directors keep their DIR-3 KYC current. Dormancy shrinks the calendar; it does not abolish it.
How long can a company remain dormant?
Dormancy is meant to be temporary. A dormant company that stops filing its annual MSC-3 return for five consecutive financial years can be struck off by the Registrar. A company that is not going to resume business should consider strike-off deliberately, rather than drifting into it.
How does a dormant company become active again?
By applying to the Registrar in Form MSC-4, accompanied by the prescribed return. Once active status is restored, the normal compliance calendar — AGM, AOC-4, MGT-7 and the rest — resumes. This is what makes dormancy a genuine pause: the road back is defined.
Does Entrecap handle dormant company applications in Mumbai?
Yes. Entrecap Business Services, based in Kandivali West, Mumbai, handles the full dormant-status process — eligibility review, board and general meeting documentation, MGT-14 and MSC-1 filings, and the ongoing annual MSC-3 compliance — for companies across Kandivali, Borivali and other Mumbai suburbs, and through associates in Delhi, Gujarat, Punjab, Andhra Pradesh, Telangana, Pune and other cities.
Can the dormant application be handled online without visiting your office?
Yes. Eligibility review, document drafting, approvals and MCA filings can all be completed remotely, wherever you are based. Our Kandivali West office is open if you would prefer to meet in person.