COMPANIES UNDER SECTION 8
The main purpose of establishing a company as a Section 8 company is to promote non-profit objectives such as the following- Commerce, Art, Science, Sports, Education, Research, Social welfare, Religion, Charity, and Protection of the Environment. A minimum of two directors shall be required if the Section 8 company is to be incorporated as a private limited company, while three directors in case of incorporation as a public limited company. There is no requirement for minimum paid-up capital in the case of a Section 8 company incorporation.
There are many advantages of registering any Non -Profit Organisation under Section 8 of the Companies Act, 2013, such as, no minimum capital, there is no minimum capital requirement, a Section 8 company enjoys tax benefits under 80G of the Income Tax Act, 1961, there is no stamp duty imposed for Section 8 company incorporation in India. The members of the Section 8 company have limited liability as per their share subscribed and are not personally liable for the losses of the company.
Advantages of Section 8 Companies
Distinct Identity: The members of the company shall have no liability towards company debts because the company and members both are separate people in the eye of the law.
Liability is Limited: The Member’s responsibility for the company’s debts is limited in a limited liability company.
Less stamp duty: There is minimum stamp duty liveable. Section 8 company shall get the benefit if it gets registration under section 80G and 12AA of IT act.
Procedure for incorporation of a Section 8 company.
Step 1– Our team shall obtain a DSC of the Directors of your entity. Once a DSC is received, our team shall proceed to file Form DIR-3 with the ROC to procure a DIN.
Step 2– Once the DIR-3 is approved, the ROC shall be given DIN to the proposed directors.
Step 3– We shall file Form INC-12 with the ROC to apply for a license for the Section 8 company along with the attachment of the required documents.
Step 4– Once the form is approved, a license under section 8 will be issued in Form INC-16.
Step 5– After obtaining the license, we shall proceed to file the SPICe+ Form with the ROC for incorporation along with the required attachments.
Documents Required For Section 8 Company Registration
Registering as a Section 8 Company is outlined in the Companies Act of 2013. An application in Form No. INC.12 must be filed to the Registrar of Companies, and the supporting documents required for Section 8 Company Registration is listed below: