Section 8 Company Registration
Check out details with the procedure for registration of section 8 with companies Act, 2013
The primary purpose of registering a company as a Section 8 Company is to promote non-profit objectives such as trade, commerce, arts, charity, education, religion, environment protection, social welfare, sports research, etc.
To incorporate a Section 8 Company, a minimum of two directors are required. Also, there is no requirement of minimum paid-up capital in the case of Section 8 Company.
In India, a non-profit organization can be registered under the Registrar of societies or as a Non-profit company under the Section 8 Company of the Company Act,2013.
The profits of this company, if there are any, are applied towards promoting the objectives of the company and not distributed as dividends to its shareholders.
A Section 8 Company is the same as the Section 25 Company under the old Companies Act, 1956. As per the new Companies Act of 2013, Section 25 has now become Section 8.
Section 8 Company Eligibility
Who can Incorporate a Section 8 Company?
An individual or group of individuals can apply for Section 8 Company Registration if it holds the below-mentioned intentions. The objectives have to be confirmed to the satisfaction of the Central Government.
- If the company intends to promote science, commerce, education, art, sports, research, charity, social welfare, protection of the environment, or other objectives
- If the company has the intention to invest all the profits or the income generated after incorporation in the promotion of such objects only;
- When the company is not intending to pay any dividends to its members.
Documents Required for Registering a Section 8 Company
- Director Identification Number (DIN)
- 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
- Address Proof
How to obtain Digital Signature for Directors?
In India, a Trust is controlled by the trustees mentioned in the Trust Deed. Section 8 Company will be governed by the Board of Directors, similar to a Private Limited Company.
During the process of incorporation, the DSC is obtained for the proposed directors. The following documents must be submitted.
- PAN or Aadhar card.
- Drivers License/ Passport/ Election ID/ Government Issued ID.
After submitting these documents, the applicant must complete an OTP and eKYC procedure to obtain a DSC in their name.
Section 8 Company Name Approval
- Simultaneous to the Digital signature application processing, an application for name approval can be initiated for the Section 8 Company to the MCA.
- The name of a Section 8 Company must end with the words like Foundation, forum, association, federation, chambers, council, electoral trust. Etc.
- The Name approval process can be completed within with24-72 hours.
- Memorandum of Association and AOA (Articles of Association)
- They are drafted after obtaining the name approval and other documents included in INC12 filed with the ROC.
- It is necessary to sign and mention his name, description, address, and occupation in the MOA and AOA subscription.
- It is necessary to have one witness present who will attest the signature.
Process of Incorporation
Step by step procedure to incorporate a Section 8 Company
- In the first step, we obtain the DSC for the proposed Directors of the Section 8 Company.
After obtaining the DSC, file form DIR 3 with the ROC for getting a Director Identification Numbers.
- After the DIR 3 is approved, the ROC will allot the Director Identification Number to the proposed Director.
- To apply for a company name, it is necessary to file Form INC 1 with ROC.
- After the approval to apply for a license for the Section 8 Company, it is necessary to File Form INC 12
- After the ap
- proval, a license under section 8 will be issued in Form INC 16.
- File SPICe Form 32 with the ROC for incorporation along with the affidavits, declarations, KYC, consent letter, draft MOA, and AOA after he obtains the license
If the ROC is satisfied with the submitted forms, the ROC is issued a Certificate of incorporation.