What is Form INC-20A?
Form INC-20A is a declaration filed by the directors of a company stating that every subscriber to the memorandum has paid the value of the shares agreed to be taken by them. This form is also known as the Declaration for Commencement of Business.
It was introduced to curb the menace of shell companies. Without filing this form, a company cannot commence its business operations or exercise any borrowing powers.
Who Needs to File INC-20A?
It is mandatory for:
- All companies incorporated on or after 2nd November 2018.
- Companies having a share capital.
Exemptions: Companies incorporated before this date and companies without share capital (limited by guarantee) are not required to file this form.
Filing Deadline
The form must be filed within 180 days from the date of incorporation of the company.
Important: You cannot start your business or borrow money until this form is filed and approved.
Documents Required
To file Form INC-20A, you need the following proofs:
- Bank Statement: A company bank account statement showing credit entries for the subscription money received from all shareholders.
- Board Resolution: A copy of the resolution passed by the Board of Directors approving the filing of the form.
- Photograph of Registered Office: (Optional but recommended) Photos showing the external and internal view of the registered office.
- Sectoral Approval: (If applicable) Approval from regulators like RBI, SEBI, etc.
Step-by-Step Filing Process
- Open Bank Account: Open a current account in the company's name.
- Deposit Capital: Shareholders must deposit the subscription amount into this account.
- Hold Board Meeting: Pass a resolution to file INC-20A.
- Prepare Form: Fill Form INC-20A on the MCA portal.
- Attach Proofs: Upload the bank statement and board resolution.
- Certification: The form must be certified by a practicing CA, CS, or CMA.
- Submit & Pay: Upload the form and pay the government fee.
Fees and Penalties
The standard filing fee depends on the authorized capital:
| Authorized Capital | Filing Fee |
|---|---|
| Up to ₹1,00,000 | ₹200 |
| ₹1,00,000 - ₹4,99,999 | ₹300 |
| ₹1 Crore or more | ₹600 |
Penalties for Non-Compliance:
- Company: Penalty of ₹50,000.
- Officers in Default: ₹1,000 per day (Max ₹1 Lakh).
- Strike Off: The ROC may strike off the company name if not filed within 180 days.
