Section 455 of CA 2013 : Section 455: Dormant Company

Explanation using Example

Imagine a company, XYZ Tech, was formed with the sole purpose of holding a patent for a futuristic technology that is not yet viable for commercial use. Over the past two financial years, XYZ Tech has not been involved in any business operations or made any significant accounting transactions besides paying the fees to the Registrar, maintaining its office and records, and allotting shares to fulfil the requirements of the Companies Act. It also hasn't filed any financial statements or annual returns during this period.

Given these circumstances, XYZ Tech would qualify as an "inactive company" under Section 455 of the Companies Act, 2013. The company can apply to the Registrar to obtain the status of a "dormant company". Once the application is considered and approved, the Registrar will issue a certificate to XYZ Tech confirming its dormant status. The name of XYZ Tech will also be entered in the register maintained for dormant companies.

XYZ Tech will need to maintain a minimum number of directors and file certain documents, along with paying an annual fee to the Registrar, to retain its dormant status. If XYZ Tech fails to comply with these requirements, the Registrar has the authority to strike off its name from the register of dormant companies.