- Definition-A Section-8 Company is a Company which
(a) has in its objects the promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other object;
(b) intends to apply its profits, if any, or other income in promoting its objects; and
(c) intends to prohibit the payment of any dividend to its members
- Type- Such Company can be formed either as a Public Company or as a Private Company
- Promoters-Following can be the promoters of Company
- a. Natural Person
- b. Company whether incorporated under India or outside India
- c. A partnership firm
- Members and Promoter -Following is the requirement of members pursuant to type of Company:
- a. In case of Public Company: Minimum 7 members and maximum no limit
- b. in case of Private Company: Minimum 2 members and maximum 200 members
- Directors- Following is the Directors of members pursuant to type of Company:
- a. in case of Public Company: Minimum 3 directors and maximum 15 directors
- b. in case of private company: Minimum 3 Directors and maximum 15 Directors
- Paid Up Capital- Any amount of contribution can be made by promoters of Company provided every promoter shall contribute such amount.
- Objects-A Section 8 Company shall be incorporated only for following purposes
- a. Promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other objects
- b. Shall not support with its funds any regulation or restriction which, as an object of the company, would make it a trade union.
- Name-Name of such Companyshall be in consonance to the Objects of company, the Company will be registered as a Limited Company without using the words “Limited” or “Private Limited”
- Miscellaneous Provisions
- a) Amalgamation-A Section 8 Company can be amalgamated /merged with another Company having same objects as its.
- b) Change of Objects- Memorandum and Articles of such Company can only be changed after the Approval of Central Government
- c) Revocation of License- Central Government can revoke the license of such company after giving an opportunity of being heard if the Company contravene any of the provisions applicable on it as per act.
- d) Consequences of Default- If Company contravene any of the above mentioned provisions of the act Company shall be punishable with a fine from Rs. 10,00,000 to Rs 1,00,00,000 and the directors shall be punishable with an imprisonment of 3 years or a fine of Rs 25,000 to Rs 25 ,00,000 rupees or with both
PROCEDURE
| S. No. | Description | Time |
| 1 | Digital Signature Certificate (‘DSC’ )
At least one promoter and every Director of Company shall have a Digital Signature Certificate |
2 Working Days |
| 2. | Director Identification Number (“DIN”)
Acquiring DIN of every Director of Company |
Within same working day or the same can also be get by Spice 32 form |
| 3. | File RUN
Apply name of Company |
3-4 Working Days depending upon the complexity of name |
| 4. | File Spice 32
Form for incorporation of Company |
1 Week -2 Week can exceed if department require any clarification or query |
| 5. | Certificate of Incorporation of Company (“COI”) | If all the above documents are found to be satisfactory department shall grant COI to the company |
Conclusion: Hope you have clear idea about section 8 company, still in case you need any further clarification or information, please feel free to contact us at complianceship@gmail.com or +91-8010233173 or visit our website at www.complianceship.com
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