Section 8 company
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About Section 8 company
A Section 8 Company is a legal structure in India for Non-Governmental Organizations (NGOs) that want to operate under the Companies Act, 2013. This provides benefits like increased credibility and easier fundraising compared to a traditional trust or society. Section 8 companies work for social causes like education, healthcare, or environmental protection, and any profits must be reinvested towards achieving their goals.
There are two main types of minimum requirements for registering a Section 8 company in India:
Number of people:
- Minimum of two directors: At least two people need to be appointed as directors of the company. These directors can also be members (shareholders) of the company.
- Minimum of two members: There must be at least two members, also known as shareholders, in the company.
Other requirements:
- At least one resident director: One of the directors must be a resident of India.
- No minimum capital: There is no minimum amount of money (capital) required to start a Section 8 company. This is different from for-profit companies.
Registering a Section 8 company in India involves several steps:
Obtain Digital Signature Certificates (DSCs): All proposed directors of the company need to get DSCs. These act as digital signatures for online filing.
Acquire Director Identification Number (DIN): Once you have the DSCs, use them to file Form DIR-3 with the Registrar of Companies (ROC) to get a DIN for each director.
Reserve a Unique Company Name: Choose a suitable name for your company and file for reservation through the SPICe+ web form on the Ministry of Corporate Affairs (MCA) portal.
Apply for Section 8 License: File Form INC-12 with the ROC to obtain a license for the company. This application includes details about the company’s objectives and activities.
Incorporate the Company: Upon receiving the license, file the SPICe+ form (INC-32) along with the following:
- e-Memorandum of Association (MoA): This document outlines the company’s vision, mission, and social objectives.
- e-Articles of Association (AoA): This document details internal rules and regulations for the company’s operation.
- Other required attachments: These may include proof of address for the registered office, identity and address proof for directors and members, and consent letters from directors.
Obtain Certificate of Incorporation: After successful filing and approval, the ROC will issue a Certificate of Incorporation (COI) along with a Company Identification Number (CIN). This signifies your company’s legal existence.
Documents Required
It is very easy to register this type of business as very few documents are needed. The required documents include:
- Proof of Identity (POI)
- Proof of Address (POA)
- Passport-Sized Photographs
- Digital Signature Certificates
- Memorandum of Association (MoA)
- Articles of Association (AoA)
- Proof of Registered Office Address
Registration Duration
The typical timeframe for registering a Section 8 company in India can vary depending on several factors, but generally falls within the range of 7-15 working days.
