Section 8 Company Registration
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For the purpose of promotion of commerce, art, science, religion, charity or any other useful object, a company can be incorporated after obtaining section 8 license from the central government. The license is essentially permission to delete private Limited from the proposed name.+919899-600-605 Chat With Us
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How to Register Section 8 Company
Section 8 company is suitable for the non-profit objectives such as the promotion of commerce, art, science, sports, education, research, social, welfare, religion, charity, protection of the environment and the like. The process of incorporation of a section 8 company is similar to that of any other company registration in India with an additional requirement of a license from the central government under section 8 of the companies act, 2013. We have dedicated page to explain the detailed process of section 8 registration
Important Points on Section 8 Company
No Profit Motive: The companies registered under section 8 of the companies act, cannot distribute profits or assets to its members.
Voting Rights: The voting rights to the members of section 8 company are based on the number of shares, similar to that of any other company.
No Minimum Capital: There is no minimum level of capital prescribed, hence a section 8 company can be incorporated with the capital as required by it.
One Resident Director: One director of the company must be resident in India. A person is said to be a resident when he stays in India for at least 182 days in the FY.
Section 8 Company Registration
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List of Documents Required For Section 8 Company Registration
|A. Documents of Directors/Shareholder|
|B. Documents For Registered Address|
Process & Time Line - Registration of Section 8 Company
Step - 1: Making of DSC for all Directors and Shareholders - (Day 1)
Step - 2: Decide the name of the company in view of naming guidelines of the MCA. Please refer How to Keep Business Name How to Keep Business Name. Then file online RUN Form for name approval. - (Day 1-2)
Step - 3: Drafting of MOA, AOA, Declarations & Other Relevant Documents, Filing of SPICe+ Form for Incorporation of Company - (Day 2-6)
Step - 4: Open Bank Account, transfer capital and then file INC 20A (Declaration to Commence Business of the Company).
Frequently Asked Questions
What is the law on the name of the Section -8 Company?
The name of a section 8 company shall not include Private Limited or Limited at the end of its name and must end with any of the below words
- Electoral Trust and the like etc.
Can Section 8 Company raise capital through foreign direct investment (FDI)?
Yes, Foreign Direct Investment is allowed Section 8 Companies subject to the compliance of FEMA Regulations. However, in terms of the Foreign Contribution (Regulation) Act, 2010 [FCRA] read with the Frequently asked questions (FAQ) on the website of the ministry of the home of the union government of India, the infusion of capital in a section 8 company is a foreign contribution. In simple words, though FDI in section 8 companies is permissible, as the same is considered as a Foreign Contribution in terms of FCRA, it can be infused only with prior permission/registration from the central government.
Can Section 8 Company invest in another company or form subsidiary with the profit motive?
Yes, there is no specific restriction on making an investment in any other company by section 8 companies even if the investee company is a profit-making entity.
What documents are accepted as Identity Proof of Promoters?
For incorporation of a section 8 company under the companies act, 2013, any document from below list of the document is acceptable as Identity Proof of the director or shareholder or the proposed company.
- Driving License,
- Voter ID Card,
What documents are accepted as address proof of promoters?
For Company Incorporation, any one document from below list of address proof of the director or shareholder is acceptable. The document in support of address proof should not be older than two months.
- Bank Statement or Passbook with the transaction entry,
- Electricity Bill in the name of the promoter,
- Telephone bill, or any other Mobile Bill,
- Utility bill in the name of promoters like Gas Bill
What are the documents required as proof of registered address for company registration in India?
A Section 8 Company is incorporated with a physical address to be declared as the registered office of the newly registered company. Following are the list of the document which is acceptable as proof of premises where the registered office of the company is situated. The premises proof should not be older than two months.
- Electricity Bill,
- Gas Bill,
- Telephone Bill,
- Mobile Bill,
- NOC from the owner
Do I need to take a NOC from the owner of premises for registered address, What is the format of NOC?
Before a company occupies any premises as its registered address, a no objection certificate must be obtained from the owner of the premises. Similarly, at the time of filing for company registration, we need a NOC from the current owner of the premises along with proof of ownership as explained above.
Can co-working office space/ shared office/ Virtual Office address be registered address of the company?
A registered office is required to be declared at the time of company incorporation and to be maintained by the company under section 12 of The Companies Act, 2013, which must be capable of receiving and acknowledging all communications and notices as may be addressed to it. Further, the statutory records of the company also need to be maintained at the registered address of the company. Hence having registered address at co-working space is not acceptable unless this is a lockable area.
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