Dormant Company: A Critical Analysis

With the change in time and technology, there is a lot of change in the working of the people, with respect to their means and methods. There is thrive for easy working tools in all the sectors of the economy which a person desire. With this main aim and purpose, the Companies Act 2013 came into force. The primary objective of the revisions made to the Companies Act 1956 was to have a simplified law that will be able to address the changes taking place in the national and international scenario, enable the adoption of internationally accepted best practices and also provide flexibility in response to the ever-changing business models. One such change bought under the Companies Act, 2013 was the concept of Dormant Companies. In common parlance, the word “Dormant” means inactive or inoperative. A dormant company is an excellent opportunity to start a company for a future project or hold an asset/intellectual property without having significant accounting transactions. Even those companies which have failed to file their annual returns for the two consecutive years can be considered to be called dormant companies, which in itself indicate the beauty of Section 455 of the Companies Act, 2013, dealing with the law of Dormant Company. In this paper, the researcher carries her research through the doctrinal method to determine the fact-situations and grounds related to the research topic. The research is mainly based on secondary sources such as academic articles, books, journals, newspaper articles, other related online sources, etc., which are available relating to the concerned study. Further, the researcher will adopt the bluebook 19th edition technique to cite the different resources of the various jurists.