The newly rolled out and most discussed among the corporate is Form INC 20A. Those Companies registered in India after the commencement of the Companies (Amendment) Ordinance, 2018 and having share capital is required to obtain the commencement of business certificate before commencing any business or exercising any borrowing powers. One can say that the Ministry has reintroduced the concept of Commencement of Business Certificate via Form INC-20A on MCA.
Form INC 20 A(Commencement of Business Certificate):
Form 20A is a declaration that needs to be filed by the directors of the company at the time of the commencement of the business. It should be verified by a Chartered Accountant (CA) or Company Secretary (CS) or a Cost Accountant in practice.
Who should file form INC 20A?
On the 2nd of November, 2018 the Companies (Amendment) Ordinance 2018 was introduced, hence any company incorporated after this date will be required to file Form INC-20A. within 180 days from the date of incorporation of the company.
What are the Penalties for non filing of Form INC 20 A for Commencement of Business?
- Company will be liable to pay Rs. 50,000 penalty for not filing the Form INC 20A
- Every officer who is in default is liable to pay Rs. 1000/- per day of default upto a Maximum Rs. 1,00,000/-
- Registrar may initiate action for the removal of the name of Company / Strike off company name
Consequences of non-filing of Form-INC-20A may create hindrance for companies to start their business and also while borrowing of money. The company would be liable to a Penalty for late filing the Form INC-20A if it exceeds 360 days of from the date of incorporation.
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