Companies (Miscellaneous) Amendment Rules, 2023
Companies (Miscellaneous) Amendment Rules, 2023
The Ministry of Corporate Affairs (MCA) published the Companies (Miscellaneous) Amendment Rules, 2023 on January 21, 2023, in order to further amend the Companies (Miscellaneous) Rules, 2014. These amendments include the revision of forms MSC-1, MSC-3 and MSC-4. The same will come into effect on January 23, 2023.
Forms MSC-1, MSC-3 and MSC-4:
A dormant company is a legal entity that has been incorporated but is not currently engaged in significant business activities or operations. It is essentially a “sleeping” company that exists on paper but remains inactive. Many jurisdictions allow for the formation of dormant companies to facilitate future business endeavours or hold assets without incurring ongoing obligations.
In the context of a dormant company, specific administrative procedures and forms may need to be followed to maintain compliance with regulatory requirements. One such form is the MSC-1 (or its equivalent in different jurisdictions), which is typically used for the initial registration of a company. It includes details about the company’s name, registered office address, directors, shareholders, and objects or purpose.
When a dormant company is established, it may be required to submit periodic returns or notifications to the relevant authorities to confirm its inactive status. This is where forms like MSC-3 and MSC-4 come into play. These forms often update the company’s dormant status, change directors or shareholders, or confirm that the company has remained inactive during a specific reporting period.
Form MSC-1 (Application to Registrar for obtaining the status of dormant company):
Form MSC-1 is used in the context of the Ministry of Corporate Affairs (MCA) in India. Specifically, Form MSC-1 is the application form for seeking the availability of a company name. When a person or entity intends to register a new company in India, they need to propose a unique name for the company.
By submitting Form MSC-1, the applicant can verify whether the proposed name is already registered or is too similar to an existing company name. This step helps ensure no confusion or conflict with existing company names. Once the name availability is confirmed, the applicant can proceed with the company registration process.
Form MSC-3 (Return of dormant companies):
Form MSC-3 is used for the annual filing requirement of a dormant company under the Ministry of Corporate Affairs (MCA) in India. A dormant company is one that has no significant accounting transaction or operation during a financial year.
The MSC-3 form typically includes information about the company’s directors, shareholders, and registered office addresses. It may require details about any changes in these key areas since the last submission. The form allows the authorities to maintain accurate records and track any alterations in the dormant company’s structure or administration.
Form MSC-4 (Application for seeking status of active company):
Form MSC-4 helps the dormant company obtain the status of an active company again and pursue its operations. After obtaining active status, the company shall comply with all the annual compliances as prescribed for the company.
The MSC-4 form is designed to confirm the company’s dormant status during a specific reporting period. It may include information such as the company’s financial position, assets held, liabilities, and other relevant details demonstrating its inactivity. By submitting the MSC-4 form, the company affirms its compliance with the requirements for maintaining dormant status. Such requirements often include having no significant financial transactions or operations.
The use of forms MSC-1, MSC-3, and MSC-4 within the context of a dormant company ensures transparency and accountability. These forms help regulatory authorities keep track of dormant companies, verify their compliance with the relevant regulations. Authorities can ensure that they are not being misused for illicit purposes such as money laundering or tax evasion.
Amendments made:
As part of these amendments, the Ministry has replaced the previous versions of forms MSC-1, MSC-3, and MSC-4 with new versions. The amendments are as follows:
- MSC-1: Form MSC-1 now requires the inclusion of details pertaining to the filing of the most recent financial statement and annual returns. The inclusionse details must be included when applying to the Registrar to obtain the status of a dormant company.
- MSC-3: Return of dormant Companies – Form MSC-3 necessitates the provision of a breakdown of the company’s existing share capital in the case of return filing for dormant companies.
- Msc-4: In form MSC-4, compliance-related information must be provided, including the intention to obtain active company status for the company. It must also include a description of any non-compliance conditions.
The official notification is available for reference below:
Miscellaneous-Amendment-Rules-20230120
