A Capacitor can be understood as a two-terminal passive component which stores electrical energy. This electrical energy is stored in electrostatic field.

Initially, the negative and positive charges on two plates of the capacitor are in equilibrium. There is no tendency for a capacitor to get charged or discharged. The negative charge is formed by the accumulation of electrons, while the positive charge is formed by the depletion of electrons. As this happens without any external charge given, this state is electrostatic condition. The figure below shows the capacitor with static charges.

The accumulation and depletion of electrons according to the varying positive and negative cycles of the AC supply, can be understood as “current flow”. This is called as Displacement Current. The direction of this current flow keeps on changing as this is AC.