Section 8 Company – Tax Portal

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Section 8 Company

Home Section 8 Company

Section 8 Company Registration

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. Section 8 company is suitable for non-profit objective and it may a private limited or a public limited company. As per law in case the proposed section 8 company is a private limited then minimum two promoters is required, however in case it is a public limited section 8 company then minimum 7 person must be the promoters of the company. A ‘Section 8 Company’ is eligible for certain exemptions from provisions of law and a concessional rate of fees.
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 seeking a prior license from the central government under section 8 of the companies act, 2013.
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Documentation of the Section 8 Company Registration

Photograph

Photo & Identity Proof of Each Promoter

Identity Proof

Utility Bill as proof must be Latest

Registered office Proof

Proof of Registered Office

Pan Card

PAN Card of Each Promoter

Address Proof

Address Proof of Promoter

NOC from owner

NOC from the owner of premises

Important of 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 Process

  • 01

    Digital Signature Of Director : Step - 1

    As the application for Company Incorporation is filed online, the process starts with the issuance of Digital Signatures of class two.
  • 02

    Name Approval Of Company : Step - 2

    The Company name must be unique and should not be the same or similar to an existing company, LLP or a trademark.
  • 03

    License For Section 8 Company : Step - 3

    An application is filed before the central government for grant of license to incorporate a company without Limited in their name.
  • 04

    Incorporation, PAN AND TAN : Step - 4

    An application is made to the ROC office for incorporation of section 8 company, and allotment of PAN and TAN.

Name Approval

01.

Suffix:

Name of Section 8 Company shall include the words Association, Federation, Chambers, Confederation, Council, Electoral trust Foundation, Forum, and other such words. But there is no need to add the word Limited or Private Limited to its name



04.

Short & Simple:

The name should be brief and not too long. Moreover, it should be easy to pronounce. A person should recall that name during relevant matters
02.

Meaningful:

The name of your Section 8 Company should indicate the principal objects of the Company as set out in its MoA. For example, Aware Health and Research Foundation or Nagarjuna Agricultural Research and Development Institute are Section 8 Companies. And their names indicate the kind of work undertaken by them. This helps in branding and goodwill.
05.

Unique:

You are not allowed to name your Company that is exactly same or identical to an existing company or trademark or for which a trademark has been applied for. At LegalRaasta, you can check if the name you are proposing matches someone else.
03.

Offensive:

The proposed name should not fall in the range of undesirable names as specified in Rule 8 of Companies (Incorporation) Rules, 2014. The name of your LLP should not be abusive, against the customs and beliefs of any religion, use slur & foul words or phrases which are used as a slur and are offensive to a particular group of people.

06.

Indicative:

Every name need not indicate the objects of the company, compulsorily, but when there is some indication of objects in the name, then it shall conform to the objects mentioned.

Forms Required Section 8 Company

NumberPurpose
INC-1To apply with the ROC for Name Approval.
INC-7Application for Incorporating the Company
INC-8Declaration to Apply for PAN & TAN
INC-9Affidavit from each Director and subscriber of the MoA
INC-12This is to apply for the issuance of License to operate as a Section 8 Company.
INC-13Memorandum of Association (MoA)
INC-14Declaration from a practicing Chartered Accountant or Company Secretary
INC-15Declaration by each Subscriber of MOA (On duly notarized Non- judicial stamp paper of Rs. 100/-)
INC-16License to operate as Company under Section 8 of the Companies Act, 2013
INC-22Notice of Location of the registered office
DIR-2Consent of Directors to act on behalf of the Company
DIR-3Application to ROC to get DIN
DIR-12Appointment of Directors of the Company

Our package includes

DIN for 2 Partners

MOA/AOAa

Digital Signature For 2 Directors

Registration Fees

Name search & approval

Company Pan Card

FAQ's

In case the section 8 company is incorporated as private limited the minimum requirements of directors on the board is 2 and in case of a public limited company it must be 3
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
  • Foundation,
  • Forum,
  • Association,
  • Federation,
  • Chambers,
  • Confederation,
  • Council,
  • Electoral Trust and the like etc.
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.
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.
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.
  • Passport,
  • Driving License,
  • Voter ID Card,
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
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

 

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.
  • Download sample NOC letter from the owner of premises
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.

Yes, it can form a subsidiary company which is normal and plans to make profits.
No. Promoters of NPOs cannot be employed as a paid employee of the Company.

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