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What are Section 8 Companies?
A Section 8 company is formed with the objective of promoting commerce, arts, science, sports, education, research, social welfare, and protection of the environment. in a country. Though they are authorized to run a business and earn a profit, the profit can only be utilized for meeting company objectives, and cannot be shared among the members.
What Are The Benefits Of Section 8 companies?
- No requirements of minimum paid-up share capital or appointment of a Company Secretary.
- Non-applicability of the maximum number of Directors.
- Non-requirement of Independent Directors.
- No requirement for the constitution of nomination and Remuneration Committee, and Stakeholder Relationship Committee
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Checklist For Annual Compliance
- Appointment of An Auditor:Under section 139 of the Companies Act 2013, it is mandatory for companies to appoint an auditor. The book of accounts and annual returns of the company shall be maintained.
- Maintenance of A Register:The company shall maintain a statutory register consisting of loans obtained, charges created, its members, etc as enumerated under section 8 of the companies act 2013.
- Convening Meeting:Annual general body meeting and other statutory meetings have to be conducted.
- Report by Directors:Directors of the company shall file their annual report in an appropriate manner, consisting of fiscal data and corporate social responsibility. The board directors are responsible for this report.
- Financial Statement of The Company:The balance sheet, profit and loss A/C, cash flow statement and other financial statements to be filed by the company for the previous financial year.
- Tax Returns:At the end of every assessment year, before 30th September, tax returns are to be filed.
- Filing of Financial Statements:The financial statement shall be filed in the appropriate form ( E-FORM AOC-4), within 30 days from the last general body meeting,
- Filing Returns:Limited companies need to file the Form MGT-7 with Registrar of Companies (RoC), for filing returns within 60 days of the annual general meeting.
