Gupta Anoop & Co. Chartered Accountants

SECTION 8 COMPANIES

SECTION 8 COMPANIES


A company is referred to as Section 8 Company when it registered as a Non-Profit Organization (NPO) i.e. when it has motive of promoting arts, commerce, education, charity, protection of environment, sports, science, research, social welfare, religion and intends to use its profits (if any) or other income for promoting these objectives.

According to the rules, failure to comply with the responsibilities stated by the Central Government may lead to the winding up of the company on the orders of government. Besides, strict legal action will be taken against all the members of the company if the objectives laid down by the company prove to be bogus.

Incorporation of a Section 8 Company

Companies Act, 2013 deals with the procedure of Incorporation of a Section 8 Company and as per this section, an application in Form No. INC.12 has to be submitted along with the below-mentioned documents to the Registrar of Companies.

Form no. INC – 13 – Company’s Draft Memorandum of Association (MOA) and Articles of association (AOA) in Form No. INC – 13 (as specified in Act) along with the affixation of subscribers’ photographs.

Form no. INC-14 – A Declaration is to be affixed in Form no. INC-14 that the draft MOA & AOA are compliant with the provisions & norms of section 8 and the requirements as per Section 8 have been duly taken care of.
Note: The declaration has to be made on stamp paper & should be notarized by an Advocate, a Company Secretary, a Chartered Accountant or a Cost Accountant, practicing the profession.

Form no. INC-15 – A declaration in Form no. INC-15 on stamp paper & notarized by each member of the company who is applying.

Form no. INC-9 – Form no. INC-9 form first directors as well as each subscriber, on the relevant State’s stamp paper and appropriately notarized.

An estimation of the company’s future annual income and expenditure for the next three years, mentioning the sources of the income and the purpose of the expenditure.

New & Simplified Process of Incorporation of Section 8 Companies

Companies (Incorporation) Sixth Amendment Rules, 2019 dated 7th June 2019 to ease the Incorporation process has knocked off the need for filing Form no. INC 12, which was initially needed.

This amendment has made the Process of Incorporation of Section 8 Companies as easy & simple as that of other companies.

Section 8 Companies can be incorporated by reserving names in part A of Spice+ followed by part B of Spice+ form or by directly filing Spice+. License No. shall be given to section 8 companies during the incorporation.

When the Company Already Have the License Number

Stakeholders having License Numbers already before the filing of SPICe form may file the form as per their ease. However, one thing should be noted that form processing takes time to let the workflow changes to be effective.

Documents Requirement for the Registration of Section 8 Company

  • Digital Signature Certificate
  • Memorandum of Association
  • Articles of Association
  • Passport Size Photographs
  • Members’ Id Proof such as Aadhar Card, Passport, Voter Id
  • Details of Director (When the Members Are Other Companies/LLPs)
  • Address Evidence
  • Director Identification Number

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