What is a Section 8 Company?
A company is referred to as Section 8 Company when it registered as a Non-Profit Organization (NPO) or Non-Governmental organizations (NGOs) i.e. when it has motive of promoting arts, commerce, education, charity, protection of environment, sports, science, research, social welfare, religion and intends to use its profits (if any) or other income for under section 8(1a, 1b, 1c) of the Companies Act, 2013.
What are the Required Documents for Section 8 Company Registration?
As per the Companies Act, 2013 of the Indian Govt. the following documents are required while registering a Section 8 company:
- Photocopy of PAN Card
- Photocopy of Aadhaar Card
- Address Proof (Bank Statement, Electricity Bill, Telephone Bill)
- Two passport size Photograph
- Ownership Proof House Tax
- NOC ( From owners if rented )
What is the Eligibility to be Incorporated as a Section 8 company?
Any Non-Profit Organization (NPO) can be incorporated as a Sec 8 company that is being associated with:
- Social Welfare
- Environmental Protection
Can a Sec 8 Company be incorporated both as Public & Private Company?
A Sec. 8 company can be incorporated as a Public or Private Company. As per the Companies Act, 2013, it depends on the numbers of responsible people on the board.
Private Company: 2 Directors, 2 members
Public Company: 3 Directors, 7 members
Can a One Person Company (OPC) become a member of a Section-8 Company?
No. Following the legal directives of the Company (Incorporation) Rules, 2014 of the Indian Govt. a One Person Company (OPC) cannot become a member or be associated with a Sec. 8 company.
To which Ministry of Indian Govt. a Section 8 Company is Registered?
A Sec. 8 company is registered under the Ministry of Corporate Affairs (MCA) of the Indian Govt. Apart from that, a Sec. 8 company is mandated to follow the norms of the Reserve Bank of India (RBI) in the transaction related matters.
Can Section 8 Companies be a Holding Identity of Another Company?
Yes. A registered Sec 8 Entity under the Companies Act, 2013, can be a holding identity of another company and if needed, can promote the company as well.
Can Section 8 carry out MicroFinance Activities?
Yes. A registered Sec. 8 company in India can operate microfinance activities. But, as per the provisions of the Reserve Bank of India (RBI), the financial activities should be for the backing of social welfare.
Is it Mandatory for a Section 8 Company to Appoint an Independent Director?
No. As per the Companies Act, 2013 of the Indian Govt. a Sec. 8 Company is not mandated to appoint an Independent Director.