pri All About Form INC-20A All About Form INC-20A

Introduction  

eForm INC-20A (Declaration for commencement of business) is required to be filed pursuant to Pursuant to Section 10A(1)(a) of the Companies Act, 2013 and Rule 23A of the Companies (Incorporation) Rules, 2014.

As per new section inserted after section 10 of the companies act 2013, section 10A says a company incorporated on or after 02//11/2018, having share capital shall not commence its business or exercise any borrowing powers unless a declaration is filed by the directors within 180 days from date of incorporation of company in INC form 20A (notified on 26/01/2019), with the Registrar of Companies that ‘every subscriber to the MOA has paid the value of the shares agreed to be taken by him on the date of making of such declaration” and the contents of the said form shall be verified by a Company Secretary or a Chartered Accountant or a Cost Accountant, in practice:

Provided that in the case of a company pursuing objects requiring registration or approval from any sectoral regulators such as the Reserve Bank of India, Securities and Exchange Board of India, etc., the registration or approval, as the case may be from such regulator shall also be obtained and attached with the declaration.

♦ Is it mandatory to file form INC 20A?

Yes, it is mandatory to obtain certificate of Commencement of Business by filing form 20A

♦ Who shall file “Form INC 20A”?

  • all the companies incorporated on or after 02//11/2018
  • and having a share capital to file form 20A

♦ Who shall not file “Form INC 20A”?

  • Companies incorporated before 02//11/2018
  • and limited by guarantee not having share capital

♦ What is the due date of filing form INC 20A ?

Due date for the first time filing of “Form 20A”

Particular Due Date
Company incorporated on or after 02//11/2018 From the date of incorporation within 180 days

♦ What details are required to be furnished in “Form 20A”?

Declaration that all the subscribers to the MOA have remitted the total value of the shares agreed to be taken by them  in the Companies Bank Account.

 What are the attachments to the form 20A?

Subscribers proof of payment for value of shares

One has to attach the Bank Account statement of Company having all credit entries for receipt of subscription money received from all subscribers to MOA.

♦ What if Bank Statement is not available?

valid payment proof like NEFT / IMPS receipts.

♦ What are the Penalty if not Filed the form INC- 20?

  • Company liable to pay Rs. 50,000
  • every officer who is in default liable to pay Rs. 1000/- per day of default upto a Maximum Rs. 1,00,000/-.

♦ What are the Consequence if form is not Filed within time?

  • Registrar may initiate action for the removal of the name of Company
  • Company cannot borrow money
  • Company cannot start business

Extract of Section 10A of Companies Act, 2013:

Section 10A:

(1) A company incorporated after the commencement of the Companies (Amendment) Ordinance, 2018 and having a share capital shall not commence any business or exercise any borrowing powers unless2

(a)    a declaration is filed by a director within a period of one hundred and eighty days of the date of incorporation of the company in such form and verified in such 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.

(2) If any default is made in complying with the requirements of this section, the company shall be liable to a penalty of fifty thousand rupees and every officer who is in default shall be liable to a penalty of one thousand rupees for each day during which such default continues but not exceeding an amount of one lakh rupees.

(3) Where no declaration has been filed with the Registrar under clause (a) of sub-section (1) within a period of one hundred and eighty days of the date of incorporation of the company and the Registrar has reasonable cause to believe that the company is not carrying on any business or operations, he may, without prejudice to the provisions of sub-section (2), initiate action for the removal of the name of the company from the register of companies under Chapter XVIII.]

Extract of Rule 23A of the Companies (Incorporation) Rules, 2014

Rule 23A: Declaration at the time of commencement of business‑

The declaration under section 10A by a director shall be in Form No, 1NC-20A and shall be filed as provided in the Companies (Registration Offices and Fees) Rules, 2014 and the contents of the said form shall be verified by a company Secretary or a chartered Accountant or a cost Accountant. in practice: Provided that in the case of a company pursuing objects requiring registration or approval from any sectoral regulators such as the Reserve Bank of India, Securities and Exchange Board of India, etc., the registration or approval, as the case may be from such regulator shall also be obtained and attached with the declaration.

Source link:

http://www.mca.gov.in/MCA21/dca/downloadeforms/eformTemplates/NCA/Form_INC-20A.zip

Companies (Amendment) Ordinance, 2018

Companies (Amendment) Ordinance, 2019

Author Bio

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28 Comments

  1. ANKUSH MISHR says:

    HI SIR,

    My company closed .The all directors gone in a blackhole.How we resign from that company in case of ,Form 20A was not submiited by our CA and directors.what we do. when i am filling form DIR 11 they are not move forward due Form 20A is not submitted. please help me,

  2. CA vinod says:

    My company has filled INC 20 for certificate of commencement of Businees in one month back, now how can I download the certificate & how many it will take to get the certificate.

  3. Roushan says:

    Company incorporated in 2019, planning to strike off due to internal issues, they havent opened any bank account within 180 days.
    Can company file file INC 20A attaching declaration that conmpany is planning to strike off and hence no bank account is opened?
    Filing INC 20A is mandatory for filing STK form i believe.

  4. Faisal says:

    Hi, we incorporating a Pvt.ltd in September 2019 (2 partners). Our subscription amount is 5 lakh, but we are not in the position to collect and deposit in account. We are opening the current account. Is it possible to start the business activities and later deposit the amount in current account from our salaries or profits.

  5. Shiv Shankar Khandelwal says:

    Our Company is a subsidiary of foreign company. When we pre scrutiny the INC 20A form its given error that this form is not applicable to this company. Is requirement of filing of INC 20A exempt to subsidiary of foreign company ?

  6. Madan mohan jangid says:

    Hii Sir.. If company did not submit inc 20A form within 180 days from date of incorporation. Is their any penalty in that situation..

  7. Gomathi says:

    If a company wants to obtaining status of dormant company before 180 days, do they need to file INC 20A. Declaration for commencement of business? Please help me out.

  8. Mustanir Shayerwala says:

    A comapny was incorporated on 14.3.17 no bank account was opened and comapny did not received any share capital money from members can i file MGT-7 as company is having no share capital for 17-18? if not then what are the steps for compliance?

  9. Ayushi Sharma says:

    Please anyone help me out in the matter that whether it is mandatory to file E-Form INC-22 to ROC in case of newly formed company even if the details of Registered Office address was disclosed at the time of incorporation of the company.

  10. sajid says:

    Hello,
    As said in above articles to file a declaration. Is there is any specific format for it. or self declaration( what is need to be mention in the declaration) can anybody help me out. Thanks in advance

  11. SKDAS says:

    Hi, we incorporated a Pvt.ltd in April 2019 (2 partners). Our subscription amount is 10 lakh, but we are not in the position to collect and deposit in account. We opened current account. Kindly advise what to do. Any provision to apply without share capital or any minimum amount for service sector.

  12. Arvind Kumar Choudhary says:

    My client has not filed INC20A with in 180 days. now for filing of INC20A it is asked to file INC28. And for INC 28 order for condonation of delay is required.

    My question is from which authority i can get the same . And also the procedure . TIA

  13. Jay says:

    My company was incorporated on 15.11.2018. Form 20A is not yet filed.
    Should i get a condonation of delay order and file form 28? how can i get a condonation of delay for Form 20A?
    Could you please help with the correct idea?

  14. Rameez Siddiqui says:

    Hi.
    I got the registration of my company on 1/4/2019 and started the buisness without submitting inc 20. Have did all transctions to vendors through my personal account.

    Is the penalty will be charged if I submit inc20 now??

  15. Deeraj says:

    What if the subscribers to memorandum has paid the amount in cash ??? or is it mandatory to pay it through the bank ??. If cash mode is allowed what will be the proof of payment.

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