INC 20A - Business Commencement

INC-20A – Declaration for Commencement of Business

INC-20A is a mandatory form under the Companies Act, 2013 that certain companies need to file with the Registrar of Companies (ROC) after incorporation. Here’s a detailed breakdown:

What is INC-20A?

• It is a declaration filed by a company’s directors confirming that:

  1. The company has received the subscription money from all its shareholders as mentioned in the Memorandum of Association (MOA).

  2. The company is ready to commence business or exercise borrowing powers.

Who needs to file INC-20A?

• All companies incorporated on or after 2nd November 2018, having share capital, must file Form INC-20A.

• Companies incorporated without share capital do not need to file this form.

Timeline for Filing

• Must be filed within 180 days from the date of incorporation.

Attachments Required

1. Bank statement of the company showing receipt of subscription money from shareholders.

2. Certificate of Registration issued by sectoral regulators (e.g., RBI, SEBI) if applicable.

3. Other optional attachments (if required).

Filing Fee

• Filing fees depend on the company’s authorized share capital (as per Companies (Registration Offices and Fees) Rules, 2014).

Consequences of Non-Filing

1. Penalty on Company – ₹50,000.

2. Penalty on Officers in Default – ₹1,000 per day (up to a maximum of ₹1,00,000).

3. The ROC may also initiate action for removing the company’s name from the Register of Companies.

Sample Process

1. Open a bank account in the company’s name.

2. Collect subscription money from all shareholders.

3. File INC-20A on MCA portal with the required attachments.

4. Once approved, the company can legally commence business and avail borrowing facilities.