CERTIFICATE OF COMMENCEMENT OF BUSINESS

FORM 20A CERTIFICATE OF COMMENCEMENT OF BUSINESS

Certificate of Commencement of Business is introduced back by Ministry of Corporate Affairs has added a new Form INC 20A after the online company Registration file Form INC 20A specified to obtain business commencement certificate, by announcing that the paid-up share capital has been brought into the Companies Bank Account, Form INC 20A has issued pursuant to Companies Amendment Ordinance 2018 and Subsequent ordinance in Companies Amendment Ordinance 2019, which has the following aims.

• Eliminate shell companies
• To promote the ease of doing business.
• To increase the scope of company compliance.

What's the certificate of commencement of business companies and Form INC 20A?

Once the company is formed, subscribed to Share capital, the Promoters have to bring in the companies Bank account and Filed for form INC 20A within 180 days to obtain the business commencement certificate.

Now, members of the company's Memorandum of Company cannot delay their investment money in the company's bank account in relation to share capital in respect of the shares subscribed by them, as it has become compulsory to get a Certificate of Commencement of Business in Form INC 20A, otherwise, the company may be struck off/dissolved by the Registrar of Companies.

Whether all companies need to file for a certificate of commencement of business?

Private Limited Companies/One Person Company/Public Limited registered on or after 2nd November 2018 need to mandatorily file FORM INC 20A and Get Certificate of Commencement of Business.

Companies Registered prior to 2nd November 2018 it is not mandatory to comply, that isn't any firm registered till 1st November 2018 need not comply.

Companies can't borrow money without obtaining the certificate of Commencement of Business by filing INC 20A.

FORM INC 20A to Receive a Certificate of commencement of business need to document within

Private Limited Companies/One Person Company/Public Limited registered on or after 2nd November 2018 have to mandatorily file FORM INC 20A and Obtain a Certificate of Commencement of Business within 180 Days from the date of Registration. The date of commencement of business shall be considered when you obtain the certificate.

Documents for INC 20A (Certificate of Commencement of Business Companies Act)

Form INC-20A must be submitted for:

• Subscribers Proof of Payment for the value of stocks.
•  Certificate of Registration issued by RBI in case of NBFC companies
•  Copy of Board Resolution
• Certification form a practicing professional (CA/CS/CMA) stating the said the capital amount has been brought in

What are the Government charges to be paid for filing INC 20A to obtain Certificate of Commencement of Business?

Fee for submitting e-Form 20A:

1. In case the firm has share capital?

Nominal Share Capital                      Fee applicable

Less than 1, 00,000                            Rupees 200

1, 00,000 to 4, 99,999                        Rupees 300

5, 00,000 into 24, 99,999                   Rupees 400

25, 00,000 into 99, 99,999                 Rupees 500

1, 00, 00,000 or more                        Rupees 600

2. For Companies, If There Is No Share Capital: Rupee 200

Additional fees after 180 days from the date of Incorporation

Period of Injuries                                      Fees

Up to 30 times                                           2 times of regular fee

Over 30 days and up to 60 days               4 times of normal fee

More than 60 days and up to 90 days     6 days of regular fee

More than 90 days and up to 180 days   10 days of regular fee

More than 180 days                           12 times of normal fee 

Penalties for non-compliance with Form INC 20A and failure to obtain a business start certificate?

• The company will be liable for a penalty of fifty thousand rupees (Rs. 50,000).
• Every officer (Directors of the Company) who is in default shall be liable to a penalty of one thousand rupees for every day during which such default continues but not exceeding the number of one lakh rupees. (Rs.1000 Each Day of Default up to a maximum of Rs 1,00,000/-)
• Where no Declaration is full of 180 days and Registrar has grounds to believe that the company is not carrying on any business the company may be struck off and directors would be disqualified

Some relevant sections and rules governing INC 20A (certificate of commencement of business)

E Form INC-20A must be filed pursuant to Section 10A (1)(a) of the Companies Act, 2013 and Rule 23A of the Companies (Incorporation) Rules, 2014, which has replicated for your reference.

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 unless--

(a) a statement 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, together 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 statement.

(b) The organization has filed with the Registrar an affirmation of its registered office as provided in sub-section (2) of section 12.

(2) If a default is made in accordance with the requirements of this section, the company shall be penalized with Rs 50,000 and all officers who are in default 1 daily during such a default. You will incur a penalty of one thousand rupees. Continue, but not exceed the amount.

The declaration under section 10A by a director shall be in Form No, lNC-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 confirmed by a firm Secretary or a Chartered Accountant or a Cost Accountant. In practice: Provided that in the case of a company pursuing items requiring registration or approval from any sectoral regulators like the Reserve Bank of India, Securities and Exchange Board of India, etc., the registration or approval, as the case may be from such a regulator will also be obtained and attached with the declaration.

Conclusion-

After registration of your company, you must file your INC 20A with the Ministry of corporate affairs within 180 days from registration of the company. For filing this form every subscriber to memorandum who took shares in the company shall have to deposit that amount in the company’s bank account and the print of such transaction in the form of a bank passbook need to attach in form INC 20A and submit it with the department.

In case if you fail to do so, the government will levy late fees and other penalties as prescribed under the law. So do not delay in filing of business commencement certificate/certificate of commencement of business/commencement of business certificate. We have a panel of CA/CS and advocates who are rendering CA Services/CA Near Me option. Through them you can get your compliance done. For getting the latest offers over CA Services or CA near me service feel free to call us at 9625279785 or 9267941961 or you may write us at info@legalpillers.com