Section 8 Company Registration

A Section 8 Company, as per the Companies Act, 2013, is a company established for promoting commerce, art, science, sports, education, research, social welfare, religion, charity, protection of the environment, or ¹ other similar objectives. It intends to apply its profits, if any, or other income in promoting these objectives and prohibits the payment of any dividend to its members.

Here's a detailed guide on registering a Section 8 Company in India:

1. Key Characteristics:

• Non-profit motive: The primary objective is not to earn profit but to promote social welfare.
• Limited liability: Members have limited liability.
• No dividend distribution: Profits are used for furthering the company's objectives.
• License from Central Government: Requires a license from the Ministry of Corporate Affairs (MCA).

2. Steps to Register a Section 8 Company:

• Obtain Digital Signature Certificate (DSC) and Director Identification Number (DIN): All proposed directors must obtain a DSC and DIN.
• Name Reservation: Apply for name reservation through the RUN (Reserve Unique Name) service on the MCA portal. The name should include words like "Foundation," "Association," "Federation," "Chamber," etc.
• Drafting of Memorandum of Association (MOA) and Articles of Association (AOA):
  • MOA: Defines the company's objectives and scope of activities.
  • AOA: Contains the rules and regulations for the internal management of the company.
• Application for License (Form INC-12): Apply to the MCA for a license under Section 8.
• Incorporation Application (SPICe+ Form): File the SPICe+ form for incorporation, along with the MOA, AOA, and other required documents.
• Certificate of Incorporation: Upon approval, the Registrar of Companies (ROC) will issue a Certificate of Incorporation.

3. Key Documents Required:

• DSC and DIN of directors
• Name reservation approval
• MOA and AOA
• Form INC-12 (Application for License)
• SPICe+ form (Incorporation Application)
• Identity and address proof of directors and members
• Passport-size photographs
• Estimated future income and expenditure statement

4. Post-Incorporation Compliances:

• Obtain PAN and TAN
• Open a bank account
• Maintain proper books of accounts
• File annual returns with the MCA
• Comply with other applicable laws and regulations

5. Advantages of Registering as a Section 8 Company:

• Credibility and recognition: Provides a legal structure and enhances credibility.
• Tax benefits: Eligible for various tax exemptions under the Income Tax Act.
• No stamp duty: Exempt from stamp duty on the MOA and AOA.
• Separate legal entity: Provides a separate legal identity, distinct from its members.

Where to Register:

• Ministry of Corporate Affairs (MCA) portal: www.mca.gov.in

Important Considerations:

• The company cannot distribute profits or dividends to its members.
• The company must apply its profits and income towards promoting its objectives.
• Any alteration in the MOA or AOA requires prior approval from the Central Government.