Know everything about e-Form MSC-1

Last Updated On: Dec. 10, 2021, 10:48 p.m.
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KNOW EVERYTHING ABOUT eFORM MSC-1

What is the purpose of eForm MSC-1?

A company is formed and registered for a future project or to hold an asset or intellectual property and has no significant accounting transaction, such a company or an inactive company which 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 may make an application in eForm MSC-1 to the Registrar of Companies for obtaining the status of a dormant company.

 

What are the laws governing the eForm MSC-1?

eForm MSC-1 is required to be filed pursuant to sub-section (1) of Section 455 of the Companies Act, 2013 and Rule 3 of Companies (Miscellaneous) Rules, 2014 which are reproduced for your reference.

Section 455: Dormant Company

(1) Where a company is formed and registered under this Act for a future project or to hold an asset or intellectual property and has no significant accounting transaction, such a company or an inactive company may make an application to the Registrar in such manner as may be prescribed for obtaining the status of a dormant company.

(i) “inactive company” means a company which 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;

(ii) significant accounting transaction” means any transaction other than—

(a) payment of fees by a company to the Registrar;

(b) payments made by it to fulfil the requirements of this Act or any other law;

(c) allotment of shares to fulfil the requirements of this Act; and

(d) payments for maintenance of its office and records.

(2) The Registrar on consideration of the application allow the status of a dormant company to the applicant and issue a certificate in such form as may be prescribed to that effect.

(3) The Registrar shall maintain a register of dormant companies in such form as may be prescribed.

(4) In case of a company which has not filed financial statements or annual returns for two financial years consecutively, the Registrar shall issue a notice to that company and enter the name of such company in the register maintained for dormant companies.

(5) A dormant company shall have such minimum number of directors, file such documents and pay such annual fee as may be prescribed to the Registrar to retain its dormant status in the register and may become an active company on an application made in this behalf accompanied by such documents and fee as may be prescribed.

(6) The Registrar shall strike off the name of a dormant company from the register of dormant companies, which has failed to comply with the requirements of this section.

Rule 3: Application for obtaining status of dormant company

For the purposes of sub-section (1) of section 455, a company may make an application in Form MSC-1 along with such fee as provided in the Companies (Registration Offices and Fees) Rules, 2014 to the Registrar for obtaining the status of a Dormant Company in accordance with the provisions of section 455 after passing a special resolution to this effect in the general meeting of the company or after issuing a notice to all the shareholders of the company for this purpose and obtaining consent of at least 3/4th shareholders (in value):

Provided that a company shall be eligible to apply under this rule only, if-

(i) no inspection, inquiry or investigation has been ordered or taken up or carried out against the company;

(ii) no prosecution has been initiated and pending against the company under any law;

(iii) the company is neither having any public deposits which are out standing nor the company is in default in payment thereof or interest thereon;

(iv) the company is not having any outstanding loan, whether secured or unsecured:

Provided that if there is any outstanding unsecured loan, the company may apply under this rule after obtaining concurrence of the lender and enclosing the same with Form MSC-1 ;

(v) there is no dispute in the management or ownership of the company and a certificate in this regard is enclosed with Form MSC-1;

(vi) the company does not have any outstanding statutory taxes, dues, duties etc. payable to the Central Government or any State Government or local authorities etc.;

(vii) the company has not defaulted in the payment of workmen’s dues;

(viii) the securities of the company are not listed on any stock exchange within or outside India.

 

What is the process to file eForm MSC-1

Instructions to fill the eForm are tabulated below at field level. Only important fields that require detailed instructions to be filled in eForm are explained. Self-explanatory fields are not discussed.

 

Section 2(a): Corporate identity Number (CIN) of the company

Enter valid CIN of the company.

On clicking the Pre-fill button, system will automatically display the name, registered office address, email ID, type, date of incorporation and objects as per Memorandum of Association (MOA) of the company.

In case there is any change in the email ID, you can enter the new valid email ID of the company. GLN field is disabled for the time being.

 

Section 7: Date of passing board resolution, special resolution and SRN of form filed for special resolution

Enter the date of board resolution and special resolution passed for authorization for application for dormant status of the company.

Enter SRN of eForm MGT-14 filed for registration of special resolution passed for obtaining dormant status.

 

Section 9(a):Number of directors

Enter number of directors and their details by specifying DIN.

Ensure that minimum number of directors by the applicant company should be one in case of OPC, two in case of private company and three in case of public company.

 

Section 10:Grounds of application

Select the grounds on the basis of which application is being made.

If the company is formed and registered under the Companies Act, 2013 then please select from one of the options – any future project or holding as asset or intellectual property and also select the checkbox that the company did not have any significant transaction since incorporation.

If the company is not formed and registered under the Companies Act, 2013 then select at least one of the next three checkboxes:

The company has not been carrying on any business

The company has not made any significant accounting transaction

The company has not filed  financial statements

 

Section 11 (a):

Select whether the company have any assets/ liabilities or not.

 

Section 11 (b):Financial statement and annual return

Enter the date of financial year ending to which last financials belong and date of last annual filing was done.

Mention the reasons if no filing of annual return and financial statements is made in the last two financial years.

 

 

What are the documents required?

  • Certified true copy of board resolution authorizing making of this application.
  • Certified true copy of special resolution authorizing for obtaining dormant status
  • Auditor’s certificate
  • Statement of affairs duly certified by Chartered Accountant or Auditor(s) of the company
  • Copy of approval or no objection certificate (NOC) from the regulatory authority in case company is regulated by such authority
  • Latest financial statement and annual return of the company is mandatory to attach in case the same is filed to Registrar
  • Consent of the lender if any loan is outstanding
  • Certificate regarding no dispute in the management or ownership;
  • Any other information can be provided as an optional attachment(s).

 

Processing Type

The eForm will be auto approved (STP).

 

SRN Generation

On successful submission of the eForm MSC-1, SRN will be generated and shown to the user which will be used for future correspondence with MCA.

 

Challan Generation

On successful submission of the eForm MSC-1, challan will be generated depicting the details of the fees paid by the user to the Ministry. It is the acknowledgement to the user that the eForm has been filed.

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