Section 8 NPO Registration
Introduction
A Section 8 Company is established to promote fields like commerce, art, science, sports, research, education, religion, environmental protection, and charity. It directs its income and profits toward these objectives and does not distribute dividends to its members.
Governing Act
In India, Section 8 Companies operate under the Indian Companies Act, 2013, along with its amendments and regulations. They are administered by the Ministry of Corporate Affairs (MCA) through the Offices of the Registrar of Companies (RoC).
Unlike Trusts or Societies, which are governed by state regulations, Section 8 Companies are registered under the Central Government (MCA). This gives them higher credibility among donors, government bodies, and other stakeholders. Additionally, they are not required to use “Limited” or “Private Limited” in their names.
Benefits of Section 8 Company Registration in India
- No minimum paid-up capital requirement.
- Exempt from stamp duty during registration.
- Tax benefits for donors under sections 12AA and 80G of the Income Tax Act.
- Firms can also become members.
Requirements for Incorporation of a Section 8 Company
As per the Companies Act, 2013, the following requirements must be fulfilled for incorporating a Section 8 Company:
1. Documents Required
- Valid Passport
- Voter ID
- Aadhaar Card
- Valid Driving
- L PAN Card: Self-attested PAN card of members and directors.
- Bank Statement
- Electricity Bill
- Telephone Bill
- Mobile Bill
- Property Papers (Title Deed) Utility Bill
- (Electricity Bill/Telephone Bill/Mobile Bill) (Not older than 2 months)
Required Information
- Authorized and paid-up share capital of the proposed company and the number of shares subscribed by members.
- Explanation: The company can start with a minimum capital of ₹5,00,000/- and 10 members and will be treated as a Public Company.
- Place of birth and duration of stay of members and directors at their present residential address.
- Occupation of members and directors.
- Proposed objective/business of the company.
- Educational qualification of members and directors.
- Email IDs and contact numbers of members and directors.
Process of Section-8 Company Registration in India
The Ministry of Corporate Affairs (MCA), through its notification dated 18th February 2020 (effective from 23rd February 2020), amended the Companies (Incorporation) Rules, 2014. The old Form INC-32 (SPICe) has been replaced with the web service SPICe+, which integrates various registration processes.
Step-by-Step Registration Process
1. Application for Name Reservation
- Apply for the reservation of the company’s name using SPICe+ (PART A) at www.mca.gov.in.
- Check name availability on MCA and ensure no trademark conflicts exist.
- If you wish, you can apply for name reservation and incorporation together by filling in both PART A and PART B of SPICe+.
2. Fill the SPICe+ (PART B) for Incorporation
- SPICe+ (PART B) contains sections that allow modifications before final submission.
- Required attachments include:
- Memorandum of Association (MOA) in Form INC-13
- Articles of Association (AOA)
- Declaration in Form INC-14 (by a CS/CA/CMA) confirming compliance with Section 8 regulations.
- Estimated future annual income & expenditure (for 3 years)
- Grounds for application & a brief description of the proposed activities
- Statement of assets and liabilities
- Declaration in Form INC-15 (by applicants, confirming compliance with Section 8 regulations)
- List of promoters (including name, address, DIN or PAN)
- List of proposed directors (including name, address, DIN or PAN)
- Application for license
3. Convert SPICe+ Form into PDF
Convert the SPICe+ form into a PDF format and affix the DSC (Digital Signature Certificate).
4. Fill AGILE-PRO Form
- The AGILE-PRO form is mandatory and includes:
- EPFO (Employees’ Provident Fund Organization) & ESIC (Employees’ State Insurance Corporation) registration.
- Mandatory opening of a bank account.
- Option to obtain GSTIN (Goods & Services Tax Identification Number).
- Convert AGILE-PRO form into PDF and affix DSC.
5. Upload Forms on MCA Portal
Upload digitally signed forms on the Ministry of Corporate Affairs (MCA) portal.
6. Declaration by Subscribers & First Directors
The declaration of subscribers and first directors (previously in Form INC-9) is automatically generated in PDF format and must be electronically submitted.
Final Registration & Benefits
Once registered, a Section 8 Company can work towards its chosen objectives (e.g., commerce, art, sports, and environmental protection). It is exempt from dividend distribution to members but enjoys all the benefits of a limited company.
For further assistance regarding Section 8 company registration, feel free to contact us.