Understanding Section 8 Company Registration in Delhi
Introduction to Section 8 Company
A Section 8 company is a non-profit organization in India, operating under Section 8 of the Companies Act, 2013, and regulated by the Ministry of Corporate Affairs (MCA). These entities focus on advancing areas such as education, culture, science, philanthropy, or community well-being, with all profits reinvested into their mission. Section 8 Company Registration in Delhi provides distinct advantages, including tax benefits and reduced compliance obligations. Delhi’s vibrant urban and social ecosystem makes it a prime location for such organizations.
In Delhi, Section 8 companies work for important causes like education, healthcare, and women’s rights. The Delhi government also runs programs like the Delhi Skill Mission and Beti Bachao, Beti Padhao, which promote skill development and women’s empowerment. By registering a Section 8 company in Delhi, you can become part of these initiatives and create a positive impact.
Essential Requirements for Section 8 Company Registration in Delhi
To Register a Section 8 company in Delhi one must fulfill these requirements:
Two Directors: At least two directors are needed for incorporation.
Two Members/Shareholders: A minimum of two members is required, with no upper limit.
No Capital Requirement: No minimum paid-up capital is necessary.
Proof of Registered Office: Provide a recent utility bill for the office address in Delhi.
NOC for Premises: Submit it a No Objection Certificate from the property owner.
Distinct Name: Select a unique name that avoids resemblance to existing companies or trademarks.
Advantages of Section 8 Company Registration in Delhi
Registering a Section 8 company in Delhi offers several benefits:
Tax Benefits:
Section 8 companies qualify for exemptions under Sections 80G and 12A of the Income Tax Act, allowing donors to claim deductions. This encourages funding for your NGO, aligning with programs like Samagra Shiksha Abhiyan.
Boosted Credibility:
A Section 8 company enhances your organization’s trustworthiness. In Delhi, non-profits gain respect from stakeholders, particularly in the NCT’s diverse urban communities.
Streamlined Fundraising:
Section 8 Company Setup in Delhi facilitates fund collection. Non-profits attract donations due to their community-focused mission, with tax incentives motivating donors. Delhi’s robust CSR ecosystem, driven by businesses in areas like Connaught Place, offers funding prospects.
Robust Governance:
Adherence to strict MCA guidelines ensures transparency and accountability, fostering trust among Delhi’s communities and authorities.
Reputable Standing:
Your NGO earns a prestigious identity, aiding collaborations with NCT initiatives like the Ladli Scheme.
Efficient Setup Process:
The setup process is user-friendly, with online MCA portal filings saving time.
Access to Grants:
Section 8 companies qualify for government and private grants, particularly for initiatives like Mission Parivartan, which supports women’s empowerment.
Continuous Existence:
The organization persists despite changes in leadership or membership, ensuring lasting impact in Delhi’s social sector.
Documents Needed for Section 8 Company Registration in Delhi
To establish your Section 8 company in Delhi, provide these documents:
For Shareholders and Directors:
Passport-size photographs
PAN card copy
Aadhaar card, voter ID, driving license, or passport copy
Recent bank statement or utility bill
For Registered Office:
Current utility bill (electricity, water, or gas) with a Delhi address
NOC or rental agreement from the property owner
We prepare additional documents, including the Memorandum of Association (MOA) and Articles of Association (AOA). Ensure the office address complies with local regulations, such as those under the Delhi Municipal Corporation Act, 1957.
Procedure for Section 8 Company Registration in Delhi
Follow these steps to complete Section 8 Company Setup in Delhi:
Secure Digital Signature Certificate (DSC):
Obtain DSCs from MCA-approved vendors by submitting photographs, PAN, Aadhaar, email, and phone number for secure online filings.
Reserve a Distinct Name:
Choose a distinctive name for your NGO, incorporating terms like “Foundation” or “Council.” Ensure it does not resemble existing entities. File Form SPICe+ Part A for name approval, processed by the Central Registration Centre (CRC) in Manesar.
Prepare Incorporation Documents:
After name approval, we draft the MOA, AOA, financial projections, and declarations, signed by directors and members. Align the MOA with Delhi’s priorities, such as education or urban welfare.
Submit Form SPICe+ Part B:
Submit Form SPICe+ Part B: File Form SPICe+ Part B with the MCA, attaching the MOA, AOA, office address proof, NOC, KYC documents, and Form INC-15 declaration. Our team manages this process.
Obtain License and Incorporation Certificate:
The Central Registration Centre (CRC) in Manesar reviews your application. Upon approval, they issue the Section 8 license and Certificate of Incorporation, finalizing your Section 8 Company Registration in Delhi.
Delhi-Specific Policies For Section 8 Company
Section 8 Company Registration in Delhi aligns with NCT policies, supporting initiatives like:
Delhi Skill Mission:
NGOs focusing on skill development can access state funding.
Ladli Scheme:
Programs for girl child welfare provide grants for Section 8 companies.
Smart City Initiatives:
Areas like New Delhi and Dwarka back NGOs in urban development.
Comparison of Trust, Society, and Section 8 Company in Delhi
| Criteria | Trust | Society | Section 8 company |
|---|---|---|---|
| Governing Law | Indian Trust Act, 1882, applicable across India, including Delhi. | The Societies Act, 1860, with NCT-specific rules. | Companies Act, 2013, overseen by the MCA and Delhi ROC for Section 8 Company Registration in Delhi. |
| Core Document | Trust Deed: Details the trust’s purpose, trustees, and rules. Filed with the Sub-Registrar in Delhi. | Bylaws: Outlines the society’s goals, membership, and governance. Filed with the Registrar of Societies in Delhi. | MOA and AOA: Define the company’s objectives and regulations. Submitted to the CRC, Manesar. |
| Authority | Registrar of Trusts: Managed by the Sub-Registrar. | Registrar of Societies: Based in Delhi, overseeing society compliance in the NCT. | Central Registration Centre (CRC), Manesar: Issues licenses for all Section 8 companies, with compliance overseen by the Delhi ROC. |
| Minimum Members | 2 trustees, no upper limit. | 7 members minimum, no upper limit. | 2 directors/shareholders for Section 8 Company Setup in Delhi, no upper limit. |
| Annual Compliance | No mandatory filings; audits needed for 80G/12A exemptions. | Annual financial statements filed with the Registrar of Societies in Delhi. | Mandatory MCA filings: Form MGT-7 (annual returns) and Form AOC-4 (financial statements). Enforced by Delhi ROC. |
| FCRA Preference | Low: Limited transparency leads to strict scrutiny. | Low: Manual processes hinder FCRA approval. | High: Preferred for FCRA due to MCA oversight and transparency in Delhi. |
| Transparency | Low: Limited public disclosure unless 80G/12A registered. | Low: Filings accessible only to the Registrar of Societies in Delhi. | High: MCA public records ensure transparency for Delhi stakeholders. |
| Online Filing | Not available: Physical submissions are slow. | Not available: Manual filings in Delhi are complex. | Available: Section 8 Company Setup in Delhi uses the MCA’s portal for efficiency. |
| Grants and Funding | Limited: Restricted access to state grants like Ladli Scheme. | Limited: Bureaucratic hurdles limit grant access in Delhi. | Preferred: Prioritized for grants under schemes like Mission Parivartan. |
| 80G and 12A Eligibility | Possible: Rigorous application with the Income Tax Department. | Possible: Approval Possible but need much transparency and compliance. | Possible: Easily secures 80G/12A exemptions, boosting donor appeal. |
| Registration Timeline | 15–20 days: Physical verification delays the process. | 15–20 days: Manual processes in Delhi slow registration. | 5–7 days: Section 8 Company Setup in Delhi is faster via the MCA portal. |
| Governance Structure | Managed by trustees; no mandatory meetings. Less formal. | Managed by a governing body, elected by members. Meetings required. | Managed by a board of directors, adhering to MCA standards. Meetings mandatory. |
| Perpetual Existence | Continues unless dissolved by trustees or court order. | Continues unless non compliance with Societies Act. | Protected under the Companies Act, 2013, a Section 8 Company continues to operate smoothly even if there are changes in leadership. |
| Conversion Options | Cannot convert directly; requires dissolution and re-registration. | Convertible to a Section 8 company with approvals. | Convertible to other company types with Govt approval. |
| Operational | Operates across India but needs local registration for other states activities. | Limited to Delhi unless nationally registered. | Operates across India with a single registration in Delhi. |
| Compliance Costs | Low, but audits for tax exemptions add costs. | Moderate, due to filings and legal fees. | Higher, due to MCA filings and professional fees. |
| Public Perception | Less formal, suited for small-scale charity. | Community-focused but less professional. | Highly credible, ideal for large-scale NGOs in Delhi. |
Compliance Obligations for Section 8 Companies in Delhi
After completing Section 8 Company Registration in Delhi, adhere to these requirements:
Form INC-20A
File within 180 days of incorporation to confirm operations (mandatory for companies limited by shares). Submit to the Delhi ROC.
Form MGT-7:
Submit annual returns within 60 days of the Annual General Meeting, including member and share capital details.
Form AOC-4:
File financial statements within 30 days of the AGM, including balance sheet, profit and loss, and cash flow statements.
DIN KYC:
Directors must submit KYC details by September 30 annually. Non-compliance deactivates the DIN, incurring a ₹5,000 fee.
Income Tax Return (ITR):
File ITR annually to avoid penalties, aligning with 80G/12A benefits for Delhi NGOs.
Some Frequently asked Questions About Section 8 Company Registration in Delhi
What defines a Section 8 company in Delhi?
A Section 8 company promotes social good, such as education or philanthropy, under the Companies Act, 2013, ideal for NGOs in Delhi.
How many members are needed for Section 8 Company Registration in Delhi?
A minimum of two members is required.
What benefits come with Section 8 Company Registration in Delhi?
Benefits include tax exemptions, enhanced trustworthiness, and access to grants like the Ladli Scheme.
Who issues licenses for Section 8 companies in Delhi?
The Central Registration Centre (CRC) in Manesar issues licenses for all Section 8 companies.
Are specific words required in the company name?
Yes, terms like Foundation, Federation, Association or Council must be included, per the Companies (Incorporation) Rules, 2014.
Can a Section 8 company in Delhi collect public funds?
Yes, through donations and grants, subject to MCA and Income tax and FCRS regulations.
Can a one-person company (OPC) become a Section 8 company?
No, an OPC cannot convert to a Section 8 company.
Can a Section 8 company modify its objectives?
Yes, with shareholder and Central Govt approval.
What is the notice period for member meetings?
A minimum of 14 days’ notice is required.
How does My Legal Business LLP support Section 8 Company Registration in Delhi?
We provide comprehensive assistance, from DSC acquisition to ROC filings, ensuring compliance with MCA and NCT regulations.