What If Your Company Hasn't Filed ROC Returns for Years?

A company that has stopped trading does not stop having obligations. The filings keep falling due, the additional fee keeps accruing at ₹100 a day per form with no ceiling, and after three continuous years the consequences stop being financial and start affecting the directors personally.

This is a recoverable position. It gets more expensive every week, and the single worst thing to do is nothing.

What is actually accruing

The additional fee — uncapped

Under Section 403, a form filed after its due date carries an additional fee of ₹100 per day, per form, with no maximum. It is not a penalty anyone levies; the MCA portal computes it on upload and will not accept the form without it.

Indicatively, for the two annual forms together:

And that is only the annual pair. Every unfiled ADT-1, DPT-3, MSME-1 and event-based form carries its own.

The statutory penalties, on top

Sections 92(5) and 137(3) provide penalties on the company and on every officer in default for the underlying failure to file the annual return and the financial statements. These sit on top of the filing fee. Their monetary figures were reset by the Companies (Amendment) Act, 2020 as part of decriminalisation, so check the current text — the structure is a fixed amount plus a daily continuing amount up to a maximum.

Director disqualification — Section 164(2)

This is the consequence that changes people's minds.

A person who is or has been a director of a company which has not filed financial statements or annual returns for a continuous period of three financial years is not eligible to be reappointed as a director of that company, or appointed in any other company, for five years.

Read that again: it attaches to the person, and it reaches their other companies. A founder with one dormant shell and one real operating business can lose their directorship in the real business because of the shell. Lists of disqualified directors are published, and the DIN is flagged.

Strike-off by the Registrar — Section 248(1)

Where a company has not commenced business within a year of incorporation, or has not been carrying on business for two immediately preceding financial years and has not applied for dormant status under Section 455, the Registrar may strike the company's name off the register of its own motion, after notice in STK-1.

Notices go to the company's registered office and to the directors at the addresses on record. If nobody is reading the post at an office the company left years ago, the first anyone hears of it is that the company no longer exists — with its bank account frozen and its assets in limbo.

And the rest

• DIN deactivation for missed DIR-3 KYC, which blocks every signature — see our post on DIN deactivation;
• bank accounts closed or frozen on the strength of the MCA status;
• GST registration cancelled for non-filing, separately — our post on GST cancellation covers that;
• due diligence failure. No investor, lender or acquirer proceeds past an MCA search showing three open years.

Step one: find out exactly where you stand

Do not work from memory. Work from the record.

1. Pull the company master data on the MCA portal against your CIN. It shows the status — active, dormant, under strike-off, struck off — and the date of the last filing.
2. Pull the index of charges and the filing history. List every form, with its financial year and its due date.
3. Check each director's DIN status — approved, deactivated, or disqualified.
4. Check for an STK-1 notice or any other notice against the company.
5. Establish whether the books exist. This is usually the real constraint: you cannot file AOC-4 without audited financial statements, and you cannot audit without records. Bank statements can be reconstructed from the bank; vouchers often cannot.
6. Compute the additional fee for each pending form to its likely filing date, and add professional and audit costs.

Now you have the two numbers the decision turns on: the cost of catching up, and the cost of closing.

Step two: catch up, or close

Catching up makes sense if

• the company is trading, or will trade again;
• it holds assets, a licence, a brand, a contract or a bank balance worth preserving;
• a director's other directorships are at risk from Section 164(2);
• the records exist, or can be reconstructed credibly.

The sequence:

1. Reactivate the DINs first. Nothing can be signed until at least one authorised director has a live DIN. ₹5,000 each.
2. Appoint or ratify the auditor, and file the ADT-1s for the years in question.
3. Prepare and audit the financial statements for each pending year, oldest first.
4. Hold the overdue AGMs and record them properly in the minute book.
5. File the oldest year first. Several forms are rejected if the previous year is not on the record.
6. File the ancillary forms — DPT-3 for director's loans, MSME-1, and any event-based forms for changes that happened and were never reported.
7. Then diarise the cycle so it does not happen again. The full annual sequence is in our post on ROC annual filing.

Closing makes sense if

• the company has not traded for years and will not again;
• it has no assets and no liabilities, or they can be settled;
• the catching-up cost exceeds any value in keeping the entity alive.

Voluntary strike-off under Section 248(2) — application in STK-2, with a special resolution or consent of seventy-five per cent of members by paid-up capital, an indemnity bond in STK-3, a statement of accounts in STK-8 certified by a chartered accountant and not older than thirty days, and an affidavit in STK-4.

Note the catch: the overdue annual filings up to the date business ceased still have to be made. Strike-off is not an amnesty. What it does is stop the meter permanently rather than resetting it each year.

Dormant status under Section 455 is the middle path — an application in MSC-1 for a company with no significant accounting transaction, which reduces the compliance burden to an annual return of dormant company in MSC-3 while keeping the entity alive and the name reserved.

What if the company has already been struck off?

1. Check the date and route of the strike-off — on the Registrar's motion under Section 248(1), or on your own application.
2. An appeal or application under Section 252 to the National Company Law Tribunal, within the period the section allows, is the route to restoration. The Registrar is the respondent.
3. Expect to bring every overdue filing up to date anyway — the Tribunal will ordinarily require it as a condition of restoration.
4. Be realistic about whether it is worth it. Restoration is justified where there are assets, a licence, land, a bank balance or live litigation. For an empty shell, restoration costs more than it recovers, and the better answer is usually to leave it struck off and deal with the directors' disqualification position separately.

The one piece of advice

The additional fee is ₹200 a day across the two annual forms. Over a quarter of deliberation, that is roughly ₹18,000 spent on thinking about it. Get the master data, get the numbers, and make the call this month.