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Changes in Form INC-20A | “Declaration for Commencement of Business” on V3 Portal |

Yes GST

In this article we discussed about the ‘Declaration for commencement of business Form INC-20A’ MCA has come with New Section 10A inserted after Section 10 by Companies (Amendment) Ordinance, 2018 dated 02.11.2018 and same has been inserted in Rule 23A of the Companies (Incorporation) Rules, 2014.

According to this ordinance every Company incorporated on or after 02nd November, 2018 and having share capital is required to file e-form INC-20A with their respective Registrar of companies within 180 days from date of incorporation of company.

Who is required to file this Form?

Every Company Incorporated on or after 2nd November 2018 having a share capital is required to file this Form.

Companies those are exempt from filing Form 20A

The following businesses are exempt from filing Form 20A:

  1. Companies formed before to November 2, 2018 (i.e. prior to the effective date of the Companies (Amendment) Ordinance, 2018).
  2. Companies formed after November 2nd, 2018 that does not have a share capital.

What is the Time Limit to file this form?

Every Company within 180 days from the date of incorporation has to file Form INC-20A.

What are the Attachments of Form INC-20A?

Earlier the mandatory attachment is the proof of receiving the subscription money in form of bank statement.

But now the attachments which Company need to attach in the form are:

  1. Photograph of Registered Office showing external building and inside office also showing therein at least one Director/ KMP- Mandatory attachment
  2. Certificate of Registration issued by the RBI (Only in case of Non-Banking Financial Companies) /from other regulator.
  3. Notification declaration as a Nidhi Company
  4. Optional attachment(s) – if any- (As per my Interpretation the proof of receiving the subscription money in form of bank statement).

Professional Certification Mandatory

This e-Form must be verified by a company Secretary or a chartered Accountant or a cost Accountant in practice.

What are the Penalty Provisions?

Company can file such form INC-20A with Roc even after 180 days by paying additional fees as per fees rules.

Penalty On Company: the company shall be liable to a penalty of fifty thousand rupees.

 Penalty on Officer in Default: 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.

If form not been filled within prescribed time period the Registrar may initiate action for the removal of the name of Company, on the grounds that company not carrying any business or operations.

Points to Remember

  1. Now while filing the form the person has to mandatorily provide the Longitude and Latitude of the registered office address of the Company.
  2. Now while filing the form person has to provide the Details of subscriber payment for value of shares which Includes the Following points:
  1. Due to the failure to file Form INC-20A within 180 days or after 180 days from the date of formation, the firm do not have permission to file Form SH-7, MGT-14, in relation with charge documents, or any annual filing forms.
  2. Without filling INC-20A, company can change the directorship if the event held within 180 days from the date of incorporation but can’t do the same after lapse of 180 days of incorporation and can’t filled form DIR-12, in this regards the authority prospective that the company not start any business activity has not allowed to change the directorship.
  3. No corporation can accept any loans, raise any funds, enter into any agreements, or make any investments before completing form INC-20A, which implies no commercial activity, can begin.
  4. Before submitting the INC-20A, no company changes its registered office address.
  5. A business can be remove voluntarily by completing form STK-2 if it has not follow up INC-20A within 180 days of incorporation. After 180 days of incorporation, the submission of form INC-20A is permitted first. Following that, they may submit STK-2 if they so wish, in accordance with the Act’s rules governing the Strike off procedure.

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