All the companies that have been registered on or after 2nd November 2018 cannot exercise borrowing powers or commence the business until they have filed a declaration by the directors within 180 days from the date of Incorporation.
For Instance; if you have obtained Company registration certificate on MCA on 20th November 2018 you will have to file the declaration form with MCA within 180 days, i.e. before or on 20 May 2019.
INC- 20 A is a declaration for the commencement of business that is filled with Registrar of companies(ROC) within 180 days of incorporating a company. The is an auto-approved form that is filed by companies formed after 18th November 2018.
All the companies that are registered with MCA and that have a minimum share capital of 1 lakh have to obtain a certificate of commencement. Any company without approval or certification of commencement cannot start operating and cannot exercise any borrowing powers.
INC-20 A is a declaration form that is to be signed by the directors of the company and is to be verified by the authorised practising professionals. The declaration by the directors is to be filed by companies that have share capital.
Following attachments are necessary for filing Form INC-20 A with the MCA:
The company needs to provide credit entries for receipt of subscription money obtained from the subscribers of the MOA
In case of companies with an object clause that requires approval from regulatory bodies such as RBI, Security and Exchange Board of India(SEBI), IRDA. Need to provide a copy of the certificate along with the form.
Companies that are registered with MCA receive a certificate of incorporation that contains CIN of the company. The MCA requires the following to check whether the CIN provided is valid and active one.
The digital signature is required to sign the form digitally and to verify that the director signing the form is not disqualified
It is a unique identification number provided to a director of a company or any potential director.
The e-Form requires verification from practising professional(CA/CS), this can be done after they attach their DSC to the e-Form.
The director of the company needs to provide Company Identification Number(CIN) in the form which will generate a pre-filled form with the name, address of the registered office and the E-mail Id of the company.
The documents as mentioned above are to be attached while submitting the e-form. All the documents are to be scanned and attached in PDF format.
Once all the attachments are made the form provides Check form option that reviews the entire form and highlights any errors that are to be rectified. Once all the mistakes are rectified, you are required to recheck the form.
After the check is completed the following message is displayed "Form Level pre scrutiny is successful".
On successful submission of INC-20 A, SRN will be generated and will be shown to the user thereon the form will be processed by the concerned authorities(MCA) and the acknowledgement for the same will be sent to the company mail I.D.
The directors or the company professionals will have to bear the following fees based on the share capital of the company.
Less than 1 lakh
1 lakh to 4,99,999
5 lakh to 24,99,999
25 lakh to 99,99,999
1 crore and more
All the companies that are registered with MCA have to file form INC-20 A within 180 days of commencement of business. If they fail to do so, the company will be charged the following penalty based on the number of days passed after the expiry of the time prescribed.
Period of Delay
Upto 30 days
2 times the normal fee
Upto 60 days
4 times the normal fee
Upto 90 days
6 times the normal fee
Upto 180 days
10 times the normal fee
More than 180 days
12 times the normal fee
If any company fails to file form INC-20 A with the registrar, then the company will have to pay a penalty of Rs.50,000 and every director/officer of the company will be charged a cost of Rs 1000 per day.
If the company does not file the required form after the expiry of the time period(180 days) prescribed by the registrar, he can start the process of removal of the company if he has reason to believe that the company is carrying out no business activity or operation. This would mean that the company will be removed from the company Master Data available with MCA.