{"id":108392,"date":"2022-06-16T15:24:19","date_gmt":"2022-06-16T09:54:19","guid":{"rendered":"https:\/\/legalwindow.in\/?p=108392"},"modified":"2022-12-26T12:23:31","modified_gmt":"2022-12-26T06:53:31","slug":"section-455-of-companies-act-2013","status":"publish","type":"post","link":"https:\/\/www.legalwindow.in\/blog\/section-455-of-companies-act-2013\/","title":{"rendered":"Section 455 of Companies Act 2013-Dormant Company status"},"content":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-108394\" src=\"https:\/\/legalwindow.in\/wp-content\/uploads\/Section-455-of-Companies-Act-2013-Dormant-Company-status-1.png\" alt=\"\" width=\"1200\" height=\"630\" srcset=\"https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/Section-455-of-Companies-Act-2013-Dormant-Company-status-1.png 1200w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/Section-455-of-Companies-Act-2013-Dormant-Company-status-1-600x315.png 600w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/Section-455-of-Companies-Act-2013-Dormant-Company-status-1-300x158.png 300w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/Section-455-of-Companies-Act-2013-Dormant-Company-status-1-1024x538.png 1024w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/Section-455-of-Companies-Act-2013-Dormant-Company-status-1-768x403.png 768w\" sizes=\"auto, (max-width: 1200px) 100vw, 1200px\" \/><\/p>\n<p><span style=\"font-weight: 400;\">The main purpose of the revisions to the Companies Act, 1956 was to have a simplified law that would address changes taking place in the national and international context, allow for the adoption of internationally accepted best practices and provide flexibility in responding to ever-changing business models. Also similar to what was introduced in the <\/span><span style=\"font-weight: 400;\">Companies Act, 2013<\/span><span style=\"font-weight: 400;\">(herein referred as \u201cAct\u201d) was the concept of Dormant Companies in section 455 of the Act. This article will talk about section 455 of the Companies Act, 2013.<\/span><\/p>\n<table style=\"width: 100%;\">\n<tbody>\n<tr>\n<td style=\"border: 1px solid #555;\"><b>Table of Contents<\/b><\/p>\n<ul>\n<li><a href=\"#What\"><span style=\"font-weight: 400;\">What are Dormant Companies?<\/span><\/a><\/li>\n<li><a href=\"#Benefits\"><span style=\"font-weight: 400;\">Benefits under Section 455 of the Companies Act, 2013 for Dormant Companies<\/span><\/a><\/li>\n<li><a href=\"#Eligibility\"><span style=\"font-weight: 400;\">Eligibility Criteria for the status of Dormant<\/span><\/a><\/li>\n<li><a href=\"#Process\"><span style=\"font-weight: 400;\">Process of registering Dormant Companies in India<\/span><\/a><\/li>\n<li><a href=\"#Final\"><span style=\"font-weight: 400;\">Final words<\/span><\/a><\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h2 id=\"What\"><b>What are Dormant Companies?<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">In common parlance, the word \u201cDormant\u201d means to be inactive or to be inoperative. A <a href=\"https:\/\/legalwindow.in\/procedure-of-dormant-company\/\" target=\"_blank\" rel=\"noopener\">Dormant company<\/a> is a great opportunity to start a future project company or to hold intellectual property or assets without accounting transactions. On the other hand, if a company does not submit its annual returns for two consecutive years, the company will be deemed as a Dormant company.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Significant accounting transactions mean transactions other than the basic procedural functions namely company payments to the Registrar and payments to meet the requirements of this Act and any other law, the allocation of shares to meet the requirements of this Act, and payments to maintain office and records.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The company may choose to be Dormant for a variety of reasons, including<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It is possible to <\/span><span style=\"font-weight: 400;\">register a company<\/span><span style=\"font-weight: 400;\"> as inactive when the owners plan to launch it and want to keep the name.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">If the owners of the company want to restructure it, they can apply for a Dormant condition.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">If the business owner needs to take a long break for reasons such as illness, travel, maternity leave, etc.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Get your Company registered through <\/span><a href=\"https:\/\/legalwindow.in\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Legal Window<\/span><\/a><span style=\"font-weight: 400;\">.\u00a0<\/span><\/p>\n<h2 id=\"Benefits\"><b>Benefits under Section 455 of the Companies Act, 2013 for Dormant Companies<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">A company may be established to prepare for future work. This indicates that the promoters want to trade and therefore maintain the domain name.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The Company Name <\/span><a href=\"https:\/\/legalwindow.in\/trademark-registration\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Trademark<\/span><\/a><span style=\"font-weight: 400;\"> is among the intellectual property owned by an inactive company. Some authorized traders use the name of the sleeping company as it is secure.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Helps the company to present a positive image to potential buyers and lenders.<\/span><\/li>\n<\/ul>\n<h2 id=\"Eligibility\"><b>Eligibility Criteria for the status of Dormant<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">No inspections, investigations, inquiry have been ordered or conducted. Additionally, no criminal cases have been filed or pending before the company in any court of law.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In the name of an organization, there are no outstanding payments on public deposits or interest.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">A certificate stating that there is no conflict or disagreement between company management and promoters should be included.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">There should be no credit to the company&#8217;s employees.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">There should be no loan left, secure or unsecured in the <\/span><span style=\"font-weight: 400;\">business<\/span><span style=\"font-weight: 400;\">. If the loan is unsecured, the lender&#8217;s consent must be accompanied by a form.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In the name of the company, there are no tax obligations left to the central government, local governments, or the central government.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The company should not be listed on the Stock Exchange in India or elsewhere.<\/span><\/li>\n<\/ul>\n<h2 id=\"Process\"><b>Process of registering Dormant Companies in India<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">To begin the process, the first thing required is to register a Dormant Company under the Companies Act, 2013. Call a board meeting to arrange a date and venue for an Extraordinary General Meeting (EGM) for members to pass a special resolution (costs at least three-quarters of total value). During this board meeting, the director may submit a general application to the <\/span><a href=\"https:\/\/legalwindow.in\/roc-company-annual-filing\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">ROC<\/span><\/a><span style=\"font-weight: 400;\"> for a state of non-employment. For a public meeting, you must publish a notice. In addition, a Chartered Accountant or Auditor must be appointed who will issue a certificate to the general meeting.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">After that, there is an Extraordinary General Assembly. Thereafter, a special resolution was adopted. A true copy of the individual&#8217;s decision, as well as notice of the informal public meeting. This is because the ROC receives the email attachment of the<a href=\"https:\/\/www.mca.gov.in\/MCA21\/dca\/help\/instructionkit\/NCA\/Form_MGT-14_help.pdf\" target=\"_blank\" rel=\"noopener\"> MGT-14<\/a> form.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">To obtain a company sleep deprivation, the company must first submit an MSC-1 form with the attached attachment:<\/span><\/li>\n<\/ul>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">A certified copy of the decision of the same board.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">For a special decision, an accurate certified copy is required.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Auditor&#8217;s signature on the certificate.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Updated newsletter and approved by the auditor or chartered accountant.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Annual Return and the most recent Financial Statement required attachment.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">A certificate stating no disagreement between owners and management.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">If there is a debt remaining in the name of the company, the lender&#8217;s permit must be extended.<\/span><\/li>\n<\/ul>\n<h2 id=\"Final\"><b><a href=\"https:\/\/legalwindow.in\/revival-of-strike-off-companies\/\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-111724 size-full\" title=\"revive the strike of company in Jaipur\" src=\"https:\/\/legalwindow.in\/wp-content\/uploads\/revive-the-status-of-strike-off-company-starting-from-25000-1.png\" alt=\"revive the strike of company in Jaipur \" width=\"1000\" height=\"200\" srcset=\"https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/revive-the-status-of-strike-off-company-starting-from-25000-1.png 1000w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/revive-the-status-of-strike-off-company-starting-from-25000-1-600x120.png 600w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/revive-the-status-of-strike-off-company-starting-from-25000-1-300x60.png 300w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/revive-the-status-of-strike-off-company-starting-from-25000-1-768x154.png 768w\" sizes=\"auto, (max-width: 1000px) 100vw, 1000px\" \/><\/a>Final words<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">In terms of section 455 of the Companies Act, 2013 Dormant Company is an unemployed company that has not conducted business or made significant financial transactions during the last two financial years. Such companies may apply to the Registrar for a status of an inactive company. At the same time, the Registrar may also direct such a company in the case of an inactive company. Hope you got all the necessary details about section 455 of the Companies Act, 2013.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The main purpose of the revisions to the Companies Act, 1956 was to have a simplified law that would address changes taking place in the national and international&hellip;<\/p>\n","protected":false},"author":3,"featured_media":108395,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-108392","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-miscellaneous"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.1 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Section 455 of Companies Act 2013 | Dormant Company status<\/title>\n<meta name=\"description\" content=\"Read Article on Section 455 of Companies Act 2013 and Dormant Company status. 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