CONTENTS:

• SECTION-8 COMPANY REGISTRATION PROCEDURE
• CRITERIA OF SECTION-8 COMPANY
• FEATURES OF SECTION-8 COMPANY
• ADVANTAGE OF SECTION-8 COMPANY
• DISADVANTAGE OF SECTION-8 COMPANY
• DOCUMENTS OF SECTION-8 COMPANY
• FORM 24A

SECTION 8 COMPANY REGISTRATION PROCEDURE 

Section-8 Company is a type of company which is registered as a non-profit organization. A section-8 company is basically a Limited Liabilities entity which is formed with the purpose of social welfare any profits. Section 8 Company is one of the best Non-profit organization because of its systematical framework. A section 8 company is like that of any other company registration in India. These organizations are established to promote science, commerce, charity, art, sports, education, research, religion, social welfare, protection of the environment, or any other contributing cause to the betterment of society. As per law in the case section, 8 company is limited than the minimum two promoters is required, a public limited, section 8 company the minimum seven persons must be the promoters of the company. This company should not pay any dividend to its members.

A section 8 company founded to develop commerce, art, science, religion, and any other useful object, provided the profits. A Section 8 Company is like a Trust or a Society. Section 8 companies are also termed as non-profit companies. A company may be registered with limited responsibility in the direction of the central Government. So, section 8 companies are also termed as non-profit companies.

There are three criteria for realizing a particular company is section 8 company:

1. This object should be to developed science, art, commerce, religion, charity, and any other useful object.
2. Section 8 company either a public company or private company, having a limited company, it should have granted a license to such a company to accept them.
3. It should intend to apply its profits, if any, or other income in promoting its objects.

Various Feature of Section 8 Company:

• Section 8 company should have at least two Directors.
• It prohibited from paying any dividend to its members.
• Section 8 Company should have at least two Directors.
• At least share capital requirement is Rs. 1 Lakh.
• Section 8 Companies Director and shareholder can be the same persons.
• Profit and other income are used only for developing the objects of the company.

Advantage Of Section 8 Company:

1. Nothing Stamp Duty: Escape of Stamp duty for Registration.
2. Tax Benefits: Section 8 Companies are a non-profit organization. Companies also get different tax benefits. Tax deductions to the donors of the company Section 80G of the Income Tax Act.
3. Exempted from any name: To other companies who are under obligation to use their company’s name like ‘limited’ or ‘private limited’.
4. Minimum share capital: Other limited companies like private, public, or a section 8 Company do not want much share capital to set up the entity. Section 8 company can be made without any share capital.
5. Transferring ownership: No restriction/ limitation on the transfer of shares.
6. Company Law: Many privileges and exemptions under Company Law.

The Disadvantage of Section 8 Company

1. No profit Distribution: The members of a Section 8 company could not share/ distribution the profits amongst them.
2. Rules and Regulations: The central government decided many conditions in Section 8 Company. All the rules, and regulations must include in the Memorandum of Association and Articles of Associations.
3. MOA and AOA: Such a company cannot change the Memorandum of Association (MOA) or the Articles of Association (AOA) without the prior approval of the Central Government.
4. Objectives: Profit or any other income of the company is used for the promotion of the main object only.
5. Zero Benefits: The members of the company will get zero benefits out of the company. They could only repay their pocket expenses that might have fallen out in the course.

Documents Required for section 8 company:

• Digital signature for at least one director of the company.
• Photo ID proof of Directors(Pan card must)
• For Director Identification No (DIN)
• Passport size colour photograph(2)
• Address proof of directors.
• Memorandum of Association
• Articles of Association

Form for 24A

• Name, address, and profession of the members, promoters, board directors, companies name and other institutions which promoters of the applicant company are directors, description of the positions held by them (3 copies)
• Source of income of the Applicant company and calculate the annual charge.
• A Statement on grounds on which the application is made under section 8 of the companies, 1956
• Copies of the memorandum (3 printed copies) and articles of association of the applicant company, all promoters' full name, address, signature, and occupation.
• A statement of assets and responsibility.