# Dormant Company Status — MSC-1

> A company formed for a future project or to hold an asset or intellectual property, or one with no significant accounting transactions in the last two financial years, can apply under Section 455 for dormant status by filing Form MSC-1. It then files only a return of dormant company (MSC-3) each year, and keeps the minimum number of directors. Dormant status lasts up to five consecutive years; the company returns to active status by filing MSC-4.

Practice: Conversions, Changes & Closure — https://www.industax.com/services/business-changes/

Dormant status suits companies that want to keep their name, registration or an asset but have no current operations — unlike strike-off, which ends the company. It isn't available to companies with outstanding public deposits, unpaid loans, pending tax or investigations, or listed securities.

The Companies Compliance Facilitation Scheme 2026 had halved the MSC-1 fee for defaulting companies, but it closed on 31 August 2026, so normal fees apply now. Overdue filings must still be cleared before applying.

## Key facts

| Item | Detail |
| --- | --- |
| Law | Section 455, Companies Act 2013 |
| Apply | Form MSC-1 |
| Annual return | Form MSC-3 |
| Back to active | Form MSC-4 |
| Maximum period | 5 consecutive financial years |

## Who needs this

- Companies with no operations planning to restart later
- Asset- or IP-holding companies
- Companies formed for a future project

## What's included

- Eligibility check
- Pending filings cleared
- Resolutions and MSC-1 filing
- MSC-3 every year and MSC-4 on revival

## Documents

- Board and shareholder resolutions
- Statement of assets and liabilities
- Auditor's certificate on transactions

## Process

1. **Check** — Eligibility and outstanding liabilities reviewed.
2. **Apply** — MSC-1 filed; Registrar issues certificate of dormant status.
3. **Maintain** — MSC-3 filed every year until revival.

## FAQs

### What is an 'inactive company' for dormant status?

A company that has not carried on any business or operation, or has made no significant accounting transaction, during the last two financial years, or has not filed financial statements and annual returns during those two years.

### Does a dormant company need an audit?

Its MSC-3 return must be accompanied by a certificate from a chartered accountant in practice. Board meetings are reduced to at least one in each half of the calendar year.

### Should I choose dormant status or strike-off?

Choose dormant status if you want to keep the company for future use; choose strike-off if you have no further use for it. Dormant status still has small annual costs; strike-off ends them.

## Official sources

- Ministry of Corporate Affairs — MCA21 portal: https://www.mca.gov.in/

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This is general information, not advice for your specific facts.