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Annual Compliance for Dormant Private Limited Company
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What is Annual Compliance for Dormant Company?
A dormant private limited company is registered under the Companies Act, 2013 but remains inactive, meaning it does not conduct any financial transactions or business operations during a financial year. Such companies are often created to hold assets, trademarks, or for future business plans.
Even though the company is inactive, it must still comply with the basic annual filing requirements to maintain its legal existence and avoid penalties. The Ministry of Corporate Affairs (MCA) mandates that every dormant company files Form MSC-3, which serves as the annual return for dormant entities.
What Does Annual Compliance Include?
The key compliances for a dormant private limited company include:
Filing of Form MSC-3: A mandatory annual return that provides information about company status, directors, and shareholding.
Preparation of Financial Statements: Even if there is no active business, companies must prepare a “Nil” balance sheet showing no financial transactions.
Board Meetings: At least two board meetings must be held in a year, with a minimum gap of 90 days between meetings.
Maintenance of Registers and Records: Statutory registers such as Register of Members, Directors, and Shareholders must be maintained.
Audit and Certification: A Chartered Accountant must certify that the company has not carried out any significant accounting transactions.
ROC Filings: Timely submission of annual returns and other necessary documents to the Registrar of Companies (ROC).
How to File Annual Compliance for Dormant Company
The process of filing annual compliance for a dormant private limited company includes:
Document Collection: Gathering required documents like incorporation certificate, MOA, AOA, board resolutions, and financial statements.
Form Preparation: Drafting and verifying Form MSC-3 and other relevant attachments by a compliance professional.
Digital Filing: Filing the form electronically with the MCA portal using a valid Digital Signature Certificate (DSC).
Verification and Acknowledgment: The ROC reviews the submission, and once approved, issues an acknowledgment confirming compliance.
Record Maintenance: Ebizfiling ensures all filings, approvals, and certificates are archived for future reference.
Why Choose Ebizfiling for Dormant Company Compliance?
At Ebizfiling, we help businesses manage their dormant status with accuracy and timeliness. From preparing financial statements to filing required ROC forms for LLP Filing, Pvt Ltd Company Compliances, OPC Annual Filing and so on, we take care of every step under MCA rules. Our team ensures your company avoids penalties and continues to remain compliant with all statutory obligations, even if it is inactive.
Keeps your dormant private limited company legally active and recognized by the MCA.
Avoid Penalties
Prevents late filing fees or disqualification due to missed compliance deadlines.
Ease of Activation
Makes it easier to convert your dormant company back to active status when needed.
Company Protection
Safeguards your brand name, assets, and intellectual property from being reused by others.
Updated Records
Ensures that the company’s information is up to date in MCA records at all times.
Professional Handling
Compliance managed by experts who understand MCA guidelines and documentation.
Documents Required for Dormant Company Annual Filing
Documents for Dormant Company Annual Filing
Certificate of Incorporation of the Company
Memorandum & Articles of Association
Board Resolution for compliance filing
PAN Card and address proof of directors
Financial statements (if any)
DSC of the authorized signatory
Step-by-Step Process for Dormant Company Annual Filing
1
Document Review
2
Prepare Form MSC-3
3
Attach Required Documents
4
File with ROC
5
Receive Confirmation
How Ebizfiling Helps you in Annual Compliance?
Reviews company documents and prepares ROC filings.
Prepares and submits Form MSC-3 accurately on time.
Assists in maintaining dormant status as per MCA rules.
Provides professional certification and record management.
Offers reminders for future compliance deadlines.
Handles communication with ROC authorities.
Ensures error-free online submission through DSC.
Keeps your dormant company fully compliant and penalty-free.
FAQs on Annual Compliance for Dormant Private Limited Company
Get answers to all your queries
What is a dormant company in India?
A dormant company is one that has no significant accounting transactions during a financial year. It remains registered but inactive for business operations under the Companies Act, 2013.
Why is annual compliance required for dormant companies?
Even without active business, dormant companies must file annual returns and financial statements with the ROC to retain their legal status and avoid penalties.
What forms are required for annual compliance of a dormant company?
Dormant companies must file Form MSC-3 (annual return) and Form AOC-4 (financial statement) every year as per MCA guidelines.
What is the due date for filing annual returns for dormant companies?
The annual return must be filed within 30 days from the end of the financial year to ensure continued compliance with MCA norms.
Can a dormant company carry out business activities?
No, a dormant company cannot carry out business or financial transactions except those necessary for maintaining its registration.
What happens if a dormant company fails to file annual returns?
Non-filing may result in monetary penalties, loss of dormant status, or even strike-off by the Registrar of Companies.
How can a dormant company be reactivated?
By filing Form MSC-4 along with necessary documents and fees, a dormant company can convert into an active one with ROC approval.
Are auditors required for a dormant company?
Yes, auditors must be appointed, though the scope of audit and reporting remains minimal since the company has no active transactions.
Does a dormant company need to hold board meetings?
Yes, at least one board meeting in each half of the year is mandatory, with a gap of not less than 90 days between meetings.
What are the benefits of keeping a company dormant?
It allows the company to retain its legal identity, preserve its name, and avoid the heavy compliance burden of active companies.
Can a dormant company own assets?
Yes, dormant companies can hold property or intellectual assets but cannot earn income from them until reactivated.
Is DSC renewal necessary for directors of a dormant company?
Yes, every director must maintain an active Digital Signature Certificate (DSC) to sign and file ROC forms electronically.
Can a dormant company open or maintain a bank account?
Yes, but it must be used only for basic statutory payments like ROC fees, not for regular commercial transactions.
Is there any exemption for dormant companies in compliance costs?
Dormant companies enjoy reduced compliance costs as compared to active ones but still must meet basic annual filing requirements.
Who can apply for dormant status of a private limited company?
Only a company with no active business, no outstanding debts, and up-to-date filings can apply to become dormant.
What are the penalties for non-compliance by a dormant company?
Failure to comply can attract daily penalties as per the Companies Act and may lead to disqualification of directors.
How long can a company remain dormant?
A company can remain dormant indefinitely as long as it files its annual compliance regularly and maintains legal status.
Is GST registration needed for dormant companies?
No, if the company has no turnover or business activity, GST registration is not mandatory for dormant companies.
Can a dormant company have employees?
No, a dormant company cannot hire employees or pay salaries since it does not carry out any operational business.
Have any queries?
Reach out to our experts at Ebizfiling for quick guidance on dormant company filings, compliance renewals, or reactivation services.
Annual Compliance for Dormant Private Limited Company
Start your Annual Compliance for Dormant Private Limited Company online at just INR 16,695/- only.
Ebizfiling guides you step-by-step through ROC filing and MCA compliance for dormant private limited companies in India.