Dormant Company

18.1 Section 455 deals with dormant company. Rule 7 of the Companies (Miscellaneous) Rules, 2014, requires a dormant company to file a ‘Return of Dormant Company’ annually in Form MSC-3, inter alia, indicating the financial position duly audited by a Chartered Accountant in practice along with the annual fee as provided in the Companies (Registration Offices and Fees) Rules, 2014 within thirty days from the end of each financial year. The Committee discussed the suggestion that once a Company becomes dormant, whether it is prudent to have a requirement for such company to file any forms and returns. Since the Return of Dormant Company is a minimal form and only seeks to update its status in the Registry, the Committee did not recommend dispensing with it.

Condonation of delay in certain cases

18.2 Section 460 provides that where any application required to be made to the Central Government under any provision of this Act in respect of any matter is not made within the time specified therein, that Government may, for reasons to be recorded in writing, condone the delay. The Committee discussed that for condonation of delay under Section 460, no e-Forms have been prescribed. The Committee felt that this is required in view of the ease of doing business. Therefore, the Committee recommended that, for this purpose a single pro-forma application form can be designed and necessary amendment may be made in the Rules.

Power to exempt class or classes of companies from provisions of this Act

18.3 The Companies Act, 2013 provides the power to issue notifications under various sections of the Act. The Committee deliberated on the suggestion whether language to the effect that the notification shall come into force on the date it is published in the Official Gazette should be provided in all the notifications under the Act. The Committee discussed the need to provide clarity in each notification about the effective date on which the notification shall come into force. The notifications issued by the Ministry of Corporate Affairs, unless a date is specifically provided, are effective from the date on which they are issued/published. The Committee however noted that care can be taken to provide such a date of enforcement, wherever feasible.

Dormant company filing requirement retained; recommend e form for condonation of delay and clearer notification effective dates. The Committee retained the requirement for the Return of Dormant Company in Form MSC 3 to update registry status annually. It recommended introducing a single pro forma electronic application for condonation of delay by amendment of the Rules and urged that notifications state a clear notification effective date of enforcement.