AN OVERVIEW ON COMPANIES (AMENDMENT) ORDINANCE, 2018
- Provision of declaration for commencement of business re-introduced. Name of company can be removed if not complied with.
- In many routine matters, ‘fine’ or ‘imprisonment’ converted into ‘Penalty’, which can be imposed directly by RD or ROC after issuing SCN.
- Removal of name if company if subscription amount not paid or company not carrying on business.
DECLARATION BEFORE COMMENCEMENT OF BUSINESS [New Section – 10A]
“A company incorporated after commencement of the companies (amendment) ordinance, 2018, i.e 02-11-2018 and having share capital shall not commence any business or exercise any borrowing powers unless-
(a) a declaration filed by a director within a period of one hundred and eighty days of the date of incorporation of the company in FORM INC- 20A and verified in such a manner as may be prescribed, with the registrar that every subscriber to the memorandum has paid the value of the shares agreed to be taken by him on the date of making of such declaration; and
(b) The company has filed with the registrar a verification of its registered office as provided in sub-section (2) of section 12 in FORM INC-22.
Vide MCA notification dated 18/12/2018 Companies (Incorporation) fourth amendment Rules, 2018 has come into force wherein after rule 23, “rule 23A has been inserted” stating that the declaration to obtain certificate of commencement of business is required to be filed in Form – INC- 20A.
When to Apply?
Within 180 Days of Incorporation
Who needs to apply?
Companies having share capital which are Incorporated on or after 02/11/2018.
Documents Required
Bank statement of company having all credit entries for receipt of subscription money received from all subscribers to MOA.
Non-Compliance
Company can’t:- Start Business activity and Exercise any borrowing power (section 10A)
Any Default -Penalty to be levied
Company – Rs. 50000
Director –Rs. 10000 Per Day up to Rs. 100000
Forms to be filed
INC 20A & INC 22 (As per Instruction Kit Form INC-22 is Not required to be filed if Registered Address is already mentioned in Company incorporation forms. )
DOCUMENTS / INFORMATION REQUIRED
- Subscribers proof of payment for value of shares.
- Therefore, As per Above Requirements, Kindly provide us Bank Statement of Company having all credit entries for receipt of subscription money from Subscribers.
- If Company is regulated by any sectoral regulator, Information Required:
- Name of the regulator
- Letter number/registration number
- Date of approval/registration
- Certificate of Registration issued by the RBI is Required also in case of Non-Banking Financial Companies) /from other regulators
Author Bio
company incorporated on 28/05/2019 require to file INC 20A
Am working in Ca Office need to check whether am filed declaration of commencement or not , how do i do
I Have incorporated my company on 25/09/2019, till date i have not filled inc 20A, but now the directors wished to be changed and new directors are willing to bring the capital. Is it possible for me to file INC 20A showing capital received from the new directors?
P.S the director who is going to file this is one of the new director.
In case of subscription by partly money and partly by moneys worth. What documents can be attached as proof of subscription and How will this effect the certification by CA?
Where the shares are subscribed for monies worth or other than for money what document is to be attached as proof of subscription
Hi, I have incorporated company and subscriber of the company are now not filing to pay subscription amount.
Can a company remove its directors and change the subscribers before filing Form INC-20A. Pl revert.
Sir
I have incorporated company on 28 january,but have not yet filed the declearation of commencement.
Now i what to do please help
Is it required for Section 8 company also?
The provisions also state that the Company needs to attach along with declaration the sectoral registration or approval in Form INC-20A. However, if we havent received the said approval within requisite 180 days, how do we do complete timely filing of the form.
Respected Sir,
I had Incorporated my company on 1st March 2019, but have not yet filed the Declaration for Commencement.
However, I now want to close the company and I have not carried out any business activity till date.
As read in the guidelines of Form INC20A, If no Declaration is filed in 180 days, and the Registrar has reasonable cause to believe that the company is not carrying on any business, he may initiate action for the removal of the name of the company from the register of companies.
Kindly suggest the way so that the Registrar strikes off the name of my company.
Respected Sir,
I had Incorporated my company on 1st March 2019, but have not yet filed the Declaration for Commencement.
However, I now want to close the company and I have not carried out any business activity till date.
Kindly suggest the way so that the Registrar strikes off the name of my company.
I AM UNABLE TO PAID SUBSCRIBE SHARE CAPITAL BECAUSE OF SHORT FUND.WHAT I WILL DO
I have incorporated company on 1 Jan 2019 and commenced the business yet not filled , (INC-20A not file)
Now what to do how to do please help
Sir,is it sufficient to attach bank statement with credit entries of subscription or declaration is necessary
If in the case, a director introduces capital by way of kind and not cash, what documents are required to be attached in the given case?
I have incorporated company on 10 Dec 2018 and commenced the business on the same day, Do I need to file INC 20A which is notified on 18 Dec 2018 and the form released on 26 Jan 2019
Do we require to attach a declaration for commencement of business or it if sufficient with bank statement?
Noted. Thanks.