Dormant Company Declaration (India)
DORMANT COMPANY DECLARATION AND APPLICATION
Companies Act 2013, Section 455 | Companies (Miscellaneous) Rules 2014 | Form MSC-1
[Company Name]
CIN: [Company CIN] | Registered Office: [Company Address]
Date of Incorporation: [Incorporation Date] | Paid-Up Capital: [Paid-Up Capital]
Date of Application / Special Resolution: [Application Date]
1. SPECIAL RESOLUTION FOR DORMANT STATUS
RESOLVED by Special Resolution of the Members of [Company Name] at the General Meeting held on [Application Date] that:
(a) an application be made to the Registrar of Companies for the status of 'Dormant Company' under Section 455 of the Companies Act 2013 and the Companies (Miscellaneous) Rules 2014; and
(b) the Company has been incorporated for the following purpose and has not been carrying on any significant accounting transaction: [Dormant Purpose]; and
(c) the directors be authorised to file Form MSC-1 with the Registrar of Companies within 30 days of the date of this resolution.
2. DECLARATION OF ELIGIBILITY
We, [Director One Name] and [Director Two Name], being directors of [Company Name], hereby declare on behalf of the Company that:
(a) [Company Name] has not been carrying on any business or operation, or has not made any significant accounting transaction during the last two financial years (last significant transaction: [Last Transaction Date]). The last annual return was filed for [Last Annual Return Year].
(b) There are no pending inspections, investigations, or prosecutions against the Company under the Companies Act 2013 or any other law: [Pending Litigation].
(c) All statutory dues (taxes, ROC fees, EPF, ESI, GST) have been paid: [Pending Statutory Dues].
(d) The Company has not defaulted in payment of workmen's wages or statutory dues to employees.
(e) The Company's securities are not listed on any recognised stock exchange.
(f) The Company is not an NBFC, housing finance company, or other regulated entity.
(g) The minimum number of directors required for a dormant company is maintained: at least 2 directors for a private company ([Director One Name] and [Director Two Name]).
3. COMPLIANCE OBLIGATIONS AS DORMANT COMPANY
The directors acknowledge that after obtaining dormant status, [Company Name] shall be required to: (a) hold at least one Board meeting in each half of every calendar year, with not more than 90 days between two consecutive Board meetings; (b) file Form MSC-3 (Annual Return of a Dormant Company) with the ROC for every financial year, disclosing financial position and noting the dormant status; (c) maintain the minimum number of directors at all times; (d) notify the ROC immediately if the Company commences any significant accounting transaction (which will automatically trigger restoration to active status); (e) apply for revival to active status using Form MSC-4 when the Company wishes to resume operations.
4. REVIVAL TO ACTIVE STATUS
4.1 [Company Name] may apply to the ROC for revival to active status at any time by filing Form MSC-4 along with a Board resolution approving the revival, an updated statement of affairs, and confirmation of continued compliance with dormant company obligations.
4.2 If [Company Name] remains dormant for 5 consecutive years, the ROC may take action to strike off the Company under Section 248 of the Companies Act 2013, unless the Company revives itself before that period expires.
Director 1
________________
Signature
Director 2
________________
Signature
What Is a Dormant Company Declaration (India)?
A Dormant Company Declaration is an application filed by an Indian company with the Registrar of Companies to obtain 'dormant company' status under Section 455 of the Companies Act 2013. A dormant company is one that has been incorporated for a future project, holds assets or securities but is not actively trading, and has had no significant accounting transactions for the last two financial years.
Obtaining dormant status significantly reduces the company's annual compliance obligations — dormant companies are exempt from holding AGMs, filing full financial statements, and many other annual obligations. They must only hold one Board meeting per half-year, maintain minimum directors, and file the annual Form MSC-3 (Annual Return of Dormant Company).
The application is made by special resolution of members and filing Form MSC-1 with the ROC. The ROC issues a certificate of dormant status, and the company is entered in the Register of Dormant Companies.
The legal framework governing the Dormant Company Declaration (India) in India draws on several key statutes and regulatory bodies. Under Indian law, the Indian Contract Act 1872 governs contractual obligations, with Section 10 setting essential requirements for valid agreements. The Companies Act 2013 regulates corporate entities through the Registrar of Companies (ROC) and Ministry of Corporate Affairs (MCA). The Industrial Disputes Act 1947 and state labour commissioners govern employment disputes. The Information Technology Act 2000 and IT (Reasonable Security Practices) Rules 2011 protect personal data. The Income Tax Act 1961 and Goods and Services Tax Act 2017 govern tax obligations through the Central Board of Direct Taxes (CBDT) and GST Council. Parties executing a Dormant Company Declaration (India) in India should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Companies Act, 2013 sets the foundational requirements.
When Do You Need a Dormant Company Declaration (India)?
You need a Dormant Company Declaration when your company is inactive — it was incorporated for a future purpose, holds shares or investments in other companies, or has ceased trading and is waiting to be revived or wound up — and you wish to reduce the ongoing compliance burden and costs.
You need this declaration to legally reduce your annual compliance obligations. An inactive company that continues as an active company in the eyes of the ROC must still file annual returns, conduct AGMs, and meet all statutory deadlines — failure to do so results in penalties and, eventually, strike-off. Dormant status provides a lawful, cost-effective alternative.
You need this declaration if your company is a holding company or SPV that passively holds investments and does not conduct any business, to eliminate the cost and administrative burden of full annual compliance while preserving the company's existence for future use.
Parties in India should prepare a Dormant Company Declaration (India) proactively rather than waiting for a dispute to arise. Courts interpret agreements based on the written terms rather than oral representations. Under Indian law, the Indian Contract Act 1872 governs contractual obligations, with Section 10 setting essential requirements for valid agreements. The Companies Act 2013 regulates corporate entities through the Registrar of Companies (ROC) and Ministry of Corporate Affairs (MCA). The Industrial Disputes Act 1947 and state labour commissioners govern employment disputes. The Information Technology Act 2000 and IT (Reasonable Security Practices) Rules 2011 protect personal data. The Income Tax Act 1961 and Goods and Services Tax Act 2017 govern tax obligations through the Central Board of Direct Taxes (CBDT) and GST Council. Where the transaction involves regulated activities, prior approval from the relevant authority may be required before execution.
What to Include in Your Dormant Company Declaration (India)
An India Dormant Company Declaration (Form MSC-1) application must include: Company name and CIN; Special resolution of members approving dormant status application; Statement that company has not carried on business or had significant accounting transactions for last 2 financial years; Affidavit by directors confirming eligibility — no pending investigations, no statutory dues outstanding, no listed securities; Statement of affairs; Board resolution; Declaration that no disputes are pending; Compliance with minimum director requirement (1 for OPC, 2 for private, 3 for public); Filing within 30 days of special resolution; Annual Form MSC-3 filing obligation; Revival procedure — Form MSC-4 when ready to reactivate.
Additional compliance elements for a Dormant Company Declaration (India) used in India include: Under Indian law, the Indian Contract Act 1872 governs contractual obligations, with Section 10 setting essential requirements for valid agreements. The Companies Act 2013 regulates corporate entities through the Registrar of Companies (ROC) and Ministry of Corporate Affairs (MCA). The Industrial Disputes Act 1947 and state labour commissioners govern employment disputes. The Information Technology Act 2000 and IT (Reasonable Security Practices) Rules 2011 protect personal data. The Income Tax Act 1961 and Goods and Services Tax Act 2017 govern tax obligations through the Central Board of Direct Taxes (CBDT) and GST Council. Forms-legal.com provides this template as a starting point for India-compliant documentation.
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howpublished = {\url{https://forms-legal.com/india/business/corporate/dormant-company-declaration-india}},
note = {Free legal document template. Based on Companies Act, 2013}
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Frequently Asked Questions
Section 455 of the Companies Act 2013 and the Companies (Miscellaneous) Rules 2014 provide for the status of 'Dormant Company' — a company that has been incorporated for a future project or holds assets (including shares or securities in other entities) but has no significant accounting transaction. Dormant status reduces the company's annual compliance burden significantly. Eligibility Criteria: A company can apply for dormant status if: (a) The company has not been carrying on any business or operation or has not made any significant accounting transaction during the last two financial years, or has not filed financial statements and annual returns during the last two financial years; (b) The company has no pending inspections, investigations, or prosecutions under the Companies Act or other laws; (c) The company has no pending disputes; (d) The company has paid up all its statutory dues (taxes, ROC fees, etc.); (e) The company has not defaulted in payment of workmen's dues; (f) The company's securities are not listed on any stock exchange; (g) The company is not a regulated entity (NBFC, housing finance company, etc.). A 'significant accounting transaction' means any transaction other than: payment of fees to the ROC, payment made to fulfil statutory obligations, allotment of shares under Section 62(1)(c), payments for maintenance of registered office. Procedure: The company must pass a special resolution of members approving the application for dormant status.
A company that has obtained dormant status under Section 455 of the Companies Act 2013 can revive to active status — formally called restoration to active status — through a straightforward application process under Rule 8 of the Companies (Miscellaneous) Rules 2014. Restoration to Active Status (Voluntary): The dormant company can apply to the ROC for restoration to active status by filing Form MSC-4 along with: a Board resolution approving the revival; an updated statement of affairs; a declaration that the company has complied with all dormant company requirements including annual MSC-3 filings; and payment of applicable fees. Once processed, the ROC updates the company's status from dormant to active. Automatic Restoration by ROC: Under Section 455(5), a dormant company that carries on significant accounting transactions is automatically restored to active status. The ROC can also restore a company to active status if it fails to file Form MSC-3 or fails to maintain the minimum number of directors required for dormant companies. Compulsory Restoration: If a company remains dormant for a period of five consecutive years, the ROC may initiate action to strike off the company from the Register of Companies under Section 248, unless the company revives itself. This is a protection against indefinite dormancy being used to avoid compliance.
Even after obtaining dormant status under Section 455 of the Companies Act 2013 and the Companies (Miscellaneous) Rules 2014, a dormant company is not entirely free from compliance obligations — it simply enjoys a significantly reduced compliance burden. The key annual obligations are as follows. First, the company must file Form MSC-3 (Return of Dormant Companies) with the Registrar of Companies (RoC) annually within 30 days from the end of each financial year, confirming its continued dormant status and providing details of its directors. Failure to file MSC-3 attracts penalties under Section 455(6) and can lead to the RoC striking the company off the register. Second, the company must maintain a minimum number of directors as prescribed — at least two directors for a private company and three for a public company — and ensure the directors' DIN (Director Identification Number) is active and not disqualified under Section 164. Third, while a dormant company is exempt from statutory audit requirements under simplified norms, it must still maintain basic accounting records under Section 128 and may need to prepare financial statements if requested by shareholders or the RoC. Fourth, the dormant company must ensure that its registered office remains valid and that Form INC-22 particulars are current with the MCA21 portal. Fifth, if there are any changes in directorship during the dormant period, Form DIR-12 must still be filed.
A Dormant Company Declaration (India) does not legally require a lawyer in India, and individuals and businesses may draft and execute the document independently. The Companies Act, 2013 does not mandate legal representation for the creation or signing of this type of document. However, seeking independent legal advice from a qualified India lawyer is recommended for transactions involving substantial financial value, complex regulatory requirements, or cross-border elements where multiple legal jurisdictions may apply. A lawyer can verify that the document complies with all applicable statutory requirements, identify potential risks specific to the transaction, and confirm that the terms adequately protect the interests of all parties involved. The Supreme Court of India has jurisdiction over disputes arising from this type of document, and Registrar of Companies (ROC) may impose additional compliance obligations depending on the nature of the underlying transaction. Professional legal review is particularly advisable where the document will be submitted to government agencies or used as evidence in legal proceedings.
A Dormant Company Declaration (India) does not legally require a lawyer in India, though legal advice is recommended. Under Indian law, the Indian Contract Act 1872 governs agreements. The Companies Act 2013 and Registrar of Companies (ROC) regulate corporate documents. The Information Technology Act 2000 governs electronic contracts and data protection. The Consumer Protection Act 2019 provides consumer rights. The Income Tax Act 1961 requires tax compliance. Forms-legal.com provides this template as a starting point — always review with a qualified Indian advocate for significant transactions. Under India law, Companies Act, 2013, parties should seek independent legal advice from a qualified lawyer to confirm compliance with all applicable requirements. Under Indian law, the Indian Contract Act 1872 governs contractual obligations, with Section 10 setting essential requirements for valid agreements. The Companies Act 2013 regulates corporate entities through the Registrar of Companies (ROC) and Ministry of Corporate Affairs (MCA). Forms-legal.com provides this template as a starting point for India-compliant documentation.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
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