If you don’t know what you’re doing, the company registration process can seem pretty daunting. Of course, remembering all the requirements and details doesn’t help. Additionally, you are expected to understand a number of terms and phrases beforehand.
It’s important to know what they mean, however. Your application could be made or broken by it. Your business plan will depend on how well you understand and incorporate it. Registrar of Companies (ROC) documents required when filing your application. To get started, here’s everything you need to know.
Section 8 Companies: What Are They?
The Companies Act, 2013 defines Section 8 companies as business entities registered under the Act. This type of company has only one class of shares, and all shareholders are not required to be members. One director is the minimum number of directors. If there are no employees, there may be three directors, and if there are employees, there may be five directors.
There shall not be fewer than two members at any given time constituting the company. In accordance with its Articles, a person or entity can be appointed as a director. Alternate directors may be designated by the board if they are not qualified for appointment as directors. All powers conferred on alternate directors by law or by these articles may be exercised by them. Although he does not have voting rights, he also does not have any liability for obligations arising out of his activities on behalf of such a company, with the exception of those incurred with his funds or property.
Section 8 Companies: New Incorporation Procedure
Business registration has been made easier with the new Section 8 incorporation procedure. As a result, the process has been simplified and is much faster than before. Incorporating a Section 8 company, however, still requires compliance with the Indian Companies Act 1956.
There should be two stages to the process. Prior registration requires the completion of a form and the submission of documents. The documents may include an ID proof, a copy of your PAN card, a proof of address, a capital contribution statement, etc. Within three days, the application will be processed.
Upon receiving all approvals, the application will be published in some newspapers for three days as a costlier advertisement. After waiting 20 days, it becomes an active Section 8 company. In order to avoid problems later on, you must take the necessary steps during the business registration process.
At every stage, make sure you are aware of all requirements, such as the minimum investment and the requisite qualifications for Directors and Managers. Last but not least, if any changes need to be made to your Section 8 company afterward, you can do so easily by filing an amendment request.
A Section 8 Company Must Meet the Following Eligibility Criteria
* A company registered under the Indian Companies Act, 2013 qualifies to apply for a Section 8 company in India.
* It is required that the company have a share capital of ₹ 2 lakhs and at least two directors.
* A company should have at least one shareholder who holds not less than 51% of the shares.
* Directors and members of the company can only make the application on behalf of the company.
* Section 8 Company registration in India needs to be approved by all family members if more than 50% of directors are related.
* At least two directors and a promoter are required.
* A board of directors must be at least 18 years old; three male or female directors may constitute the required number if certain requirements are met.
Documents Needed for Section 8 Companies
* The Authority of Industry and Trade (AIT) Department issues business licenses.
* The Ministry of Commerce and Industry in India issued the certificate of incorporation.
Note: Please submit the certificate within one month of its date to the Registrar of Companies.
* Seal of the company: The seal should be embossed on all correspondence from and about the company.
* Memorandum & Articles of Association: Together, these two documents outline the nature of the business and how shares will be distributed among the members.
Note: There are several differences between the Memorandum and the Articles of Association, with the Memorandum stating the general objectives of the company and the Articles of Association stating specific provisions.
* The PAN card or PAN numbers must be provided as proof that you are eligible to set up a private limited company in India. It is also possible to use income tax returns for this purpose.
The Registration Process: What Are the Steps?
Understand how the registration process works before registering a section 8 organization. The first thing you’ll need is proof of identification, an address, a business name and DBA form, and articles of incorporation.
Officials will contact you either by mail or email after you submit your application. If the company is registered or denied, you will receive a letter informing you. It may have been noted in the rejection letter why it was rejected. Before registering again, contact the Secretary of State’s office if you have any questions about any of these reasons. Let’s say you are approved for registration. Congratulations! Now that your new company is up and running, you can start working on it.