INC-20A Filing with ROC

Business Commencement Declaration

A company, after its incorporation, has to file a declaration to the ROC in form INC-20A that it has collected the capital and maintains a Registered Address. We complete the filing within the same day. Call us now.

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Legal Provisions to File Form INC-20A

INC-20A or the Commencement of Business declaration is a mandatory post-incorporation ROC filing by Private Limited and One Person Companies, immediately after they begin their business activities. The declaration entitles the company to conduct business transactions and borrow money from financial institutions, for effectively managing their business operations. It must be noted that neither a Private Limited Company nor a One Person Company can commence their business without filing this declaration to the Registrar of Companies.
Until 2nd November, 2018, there was no requirement for filing INC-20A to the ROC. However, a notification by the MCA dated 2nd November, 2018, made the declaration mandatory for Private Limited Companies and OPCs, as a declaration of the Commencement of their business operations. The declaration is to be filed and signed by a director authorized by the company for the purpose, and must be submitted within 180 days or 6 months from the date on which the Certificate of Incorporation was issued to the company.
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Prerequisites to File Commencement of Business Declaration or INC-20A

Before filing the Commencement of Declaration Form or INC-20A, two primary compliances must be ensured. Firstly, that the company has filed details of its registered office either at the time of its incorporation or within 30 days after the date of its incorporation. Secondly, that the entire amount of subscribed capital, as mentioned in the Memorandum of Association of the company, has been deposited in its bank account before, during, or within 60 days after its incorporation. Having been aware of the two compliance, let us have a glance on all the prerequisites before filing the declaration of business commencement.

How to File a Declaration for Business Commencement?

The declaration of business commencement or INC-20A form can be found on the official website of the Ministry of Corporate Affairs. The form can be filled and submitted online to the RoC, along with the prescribed documents and the respective filing fees. The detailed step by step procedure for filing INC-20A has been mentioned below for a thorough and comprehensive understanding.
STEP 1 – Documentation
According to the provisions mentioned in the Companies Act, 2013, form INC-20A or the declaration of commencement of business must be filed along with a prescribed set of supporting documents. All these documents must be arranged before beginning the process of filing the declaration in order to avoid any hindrance or hassle, and to drastically reduce the chances of a complete rejection of the form due to incorrect or inadequate documentation.
STEP 2 – Filling form INC-20A
After having arranged all the documents, the applicant director can begin the process of filing INC-20A. For this, the applicant director will have to visit the official website of the Ministry of Corporate Affairs, where the form is available. The applicant can fill out the complete form online on the website itself, and sign it using his Digital Signature Certificate. Additionally, an independently practicing CA, CS, or CMA must also certify the authenticity of the application.
STEP 3 – Attach necessary documents
After filing out the declaration form online and signing it digitally, the applicant is required to upload all the documents sought for by the form in their digital formats. A complete and elaborate list of all such documents have been mentioned in the next section.
STEP 4 – Submit form INC-20A
After having filled out all the details and uploading all the documents prescribed with the form, you can upload the form on the MCA website and submit it after the successful payment of its government fee.
STEP 5 – Issuance of the Acknowledgement Receipt
After form INC-20A is submitted to the ROC through the MCA portal, an acknowledgement receipt shall be generated as a conclusive proof of the filing of the declaration. As the applicant director of the company, you should keep a copy of INC-20A, the documents attached with it and the acknowledgement receipt of the filing for future records.

Documents for Filing Declaration for Business Commencement

The Declaration for commencement of business activities is given in form INC-20A, which is filed and submitted on the official website of the Ministry of Corporate Affairs in the online mode only. The supporting documents that are required to be attached with the form are also uploaded in the digital format itself. Given below is an elaborate list of all such documents that accompany form INC-20A or the declaration for business commencement.
NO. Documents for filing form INC-20A
  • Subscribers proof of payment of shares
  • Certificate of Incorporation of the Company
  • DSC of the applicant Director
  • DIN of the applicant Director

INC-20A Due Dates and Late Filing

The purpose of filing INC-20A is to prevent the origination of dummy or bogus companies. Although the Companies Act, 2013 prescribes only 180 days from the date of issue of Certificate of Incorporation for the filing of INC-20A, we recommend that it should be filed immediately after its incorporation. This is because the company cannot start its business activities or borrow money for its business operations unless the declaration has been filed. To prevent this time lag, especially in the nascent stages of newly incorporated businesses, we recommend that the declaration be filed sooner rather than later, after the business has been established.

The fee applicable for filing INC-20A depends on the subscribed capital of the company. Fee applicable for INC-20A has been mentioned below.

Subscribed Capital Applicable fees
  • Upto 1 lakhs
  • 1 lakhs to 5 lakhs
  • 5 lakhs to 25 lakhs
  • 25 lakhs to 1 crores
  • More than 1 crores
  • 200
  • 300
  • 400
  • 500
  • 600
However, INC-20A can be filed after the prescribed date with the late filing fee. The late filing fee for the form has been mentioned below.
Duration of Delay from the due date Late filing fee
  • Upto 30 days
  • 30 to 60 days
  • 60 to 90 days
  • 90 to 180 days
  • Above 180 days
  • 2 times the normal fees
  • 3 times the normal fees
  • 4 times the normal fees
  • 5 times the normal fees
  • 6 times the normal fees

Approval of Form INC-20A by the RoC

The form INC-20A is filed with certification of independently practicing professionals like Chartered Accountants, Cost Accountants, and Company Secretaries. Hence, it is the responsibility of such a professional to ensure that the declaration and the documents attached to the form are correct and authentic. The form INC-20A is filed with the prescribed fee and the same gets auto-approved by the ROC under the Straight To Process method.

What Are The Consequences of Non-Filing of INC-20A?

The declaration of commencement of business or INC-20A is a mandatory legal compliance, and therefore, it is obvious that its non-filing, late filing, and incorrect filing of INC-20A is going to have There are three penal consequences prescribed for non filing of INC-20A

  • The defaulting company has to pay a penalty of ₹ 50,000 (Fifty Thousand) for failure to comply with the prescribed rules.
  • Every officer of the company that generally includes its directors, secretary, CFO and Manager would have to pay a penalty of ₹ 1000 for each day of default. However the maximum penalty for every officer to be paid for non-compliance is capped at ₹ 1,00,000 (Rupees One Lakh)
  • The maximum time allowed to file the INC-20A is 180 days from the date of incorporation, in case the company failed to file the said declaration the company would be struck off under section 248.

Frequently Asked Questions

Form 20 A is filed to the Registrar of Companies, an office under the Ministry of Corporate Affairs.
Yes, the CIN or Corporate Identification Number of the company is required to be filled out in the INC-20A form.
The RBI issues Certificate of Incorporation to non-banking financial companies only.
The subscribers are required to pay the entire amount of their subscribed capital before filing INC-20A. As a proof of such payment the bank statement of the company’s bank account can be uploaded with the INC-20A form.
No. The entire amount of subscribed capital must be deposited in the bank account in the company’s name.
Share Certificates must be paid to all the shareholders of the company, within 60 days after the company has been incorporated, whereas the maximum time limit prescribed for the total payment of subscribed capital is 180 days after the incorporation of the company. This means that a company will have to issue share certificates to all its shareholders even before the actual payment of the entire subscribed capital is made.
No, the shareholders of a company are not penalized as they are not the authority incharge for non-filing of INC-20A. Only the director authorized to file INC-20A is penalized for non-filing or late filing of INC-20A.
Yes, a Section 8 company has to file the declaration of commencement of business in form INC-20A.
Yes, all companies that have share capital, including Public companies need to file form INC-20A with the Registrar of Companies.
Yes, a company can be voluntarily closed before INC-20A has been filed.
The resolution for commencement of business is to be passed by the Board of Directors of the Company, in pursuance of section 10 of the Companies Act. The resolution is also required to be filed with the form for declaration of commencement of business.
Yes, a company may get struck off if the declaration of commencement of business has not been filed for 1 year after the date of its incorporation.
No. Only after filing INC-20A can a company become entitled to borrow money for business operations.
Companies which need not file INC-20A include:
  1. Companies without share capital
  2. Companies incorporated before 2nd November, 2018

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