Summary
- Companies can apply for dormant status under Section 455 of the Companies Act, 2013, allowing them to remain legally inactive while protecting intellectual property and minimizing compliance costs.
- To qualify, companies must have no significant transactions or outstanding dues in the last two years and should not be under investigation or prosecution.
- Dormant companies enjoy reduced compliance burdens, such as exemption from holding board meetings and filing extensive accounts, while maintaining their legal identity.
- This status offers a strategic option for businesses planning future operations without incurring active company expenses, with the flexibility to reactivate when ready.
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