COMMENCEMENT ( INC-20A)
INC-20A (Commencement of Business) is the statutory declaration filed by a newly incorporated company to confirm that subscribers have paid for their shares and that the company is eligible to commence business operations and exercise its borrowing powers.
COMMENCEMENT ( INC-20A) – An Overview
Commencement of Business (INC-20A) is a mandatory compliance requirement for companies incorporated with share capital. It involves filing a declaration with the Registrar of Companies (ROC) confirming that the subscribers to the Memorandum of Association have paid the value of the shares agreed to be taken by them. The declaration is filed in Form INC-20A within the prescribed time limit after incorporation. Upon successful filing, the company is authorized to commence its business activities and exercise borrowing powers. This compliance ensures that the company has received its initial share capital and is operating in accordance with the provisions of the Companies Act.
Benefits:
- Enables a newly incorporated company to legally commence business operations and exercise its borrowing powers while ensuring statutory compliance.
Documents Required:
- Certificate of incorporation of the company.
- Pan and cin details of the company.
- Bank account proof in the name of the company.
- Proof of share capital contribution by the subscribers to the memorandum of association.
- Board resolution authorizing the filing of INC-20A (if required).
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Commencement of Business (INC-20A)
- Verify the company's incorporation and share capital details. Review proof of subscription money received from shareholders. Prepare and complete Form INC-20A. Ensure compliance with the requirements of the Companies Act. Obtain the necessary digital signatures and professional certification. File the form with the Registrar of Companies (ROC). Track the filing status and address any ROC queries. Obtain confirmation of successful filing and commencement compliance.
FAQ:
Form INC-20A is a declaration filed with the registrar of companies (ROC) confirming that shareholders have paid their subscribed share capital, allowing the company to commence business operations.
Companies incorporated with share capital are generally required to file Form INC-20A as per the applicable provisions of the companies Act.
The form must be filed within the prescribed time limit from the date of incorporation.
Key documents include proof of share capital subscription, company bank account details, DSC of the director, and supporting incorporation documents.
No, the company is not permitted to commence business activities or exercise borrowing powers until the declaration is filed.
