A dormant company is a registered entity that does not have significant accounting transactions during a fiscal year and is not actively engaged in business operations.

Companies may choose to become dormant to retain a desired company name, preserve the entity for future business opportunities, or reduce operational costs while not actively trading.

To change status, a company must file a special resolution with the registrar, submit a Form MSC-1 to the Ministry of Corporate Affairs (MCA), and meet specific criteria set by the registrar regarding minimal financial transactions.

A company can be declared dormant if it has not been carrying out any business or significant accounting transactions for two consecutive financial years and has not filed annual returns during this period.

Required documents typically include the board resolution for dormancy, Form MSC-1, latest audited financial statements, and a statement of no significant transactions.

A company can remain dormant for up to five years, after which it must either reactivate or extend its dormant status by filing the appropriate forms with the MCA.

Dormant companies must file a 'Return of Dormant Company' annually in Form MSC-3 along with the requisite fee and minimal compliance details.

Yes, dormant companies benefit from reduced regulatory compliance requirements, lower filing fees, and minimal accounting and auditing expenses.

Yes, a dormant company can incur expenses related to the maintenance of the company, such as compliance costs or minimal statutory expenses.

To reactivate, the company must file Form MSC-4 along with the board resolution and latest audited accounts, and receive approval from the MCA.