Registering an NGO under Section 8 of the Companies Act, 2013, is a popular way to pursue charitable, social, or not-for-profit objectives in India. A Section 8 Company is set up to promote sectors such as education, art, science, sports, research, social welfare, religion, charity, or environmental protection. Below is a step-by-step guide to help you navigate the process of registering a Section 8 Company in India.

Step-by-Step Process for Registering a Section 8 Company

1. Obtain Digital Signature Certificate (DSC)

The first step involves obtaining a Digital Signature Certificate (DSC) for all proposed directors of the company. Since all filings and applications with the Ministry of Corporate Affairs (MCA) are done online, a DSC is mandatory.

• How to apply: A DSC can be obtained from any government-certified agency listed on the MCA portal.

2. Apply for Director Identification Number (DIN)

The next step is to obtain a Director Identification Number (DIN) for all directors. DIN is required to legally appoint individuals as directors of the company.

• Application method: You can apply for DIN during the submission of the SPICe+ form (Simplified Proforma for Incorporating a Company Electronically Plus), which is discussed later.

3. Reserve a Name for Your NGO

Choosing a unique name is crucial for your NGO. The name must reflect the objectives of the company and should ideally end with words like "Foundation," "Society," "Federation," "Association," "Forum," "Council," etc.

• Approval process: File the RUN (Reserve Unique Name) form on the MCA portal to secure the name of the company. Make sure the chosen name adheres to the naming guidelines under the Companies Act, 2013.

4. Draft the Memorandum and Articles of Association (MoA & AoA)

The Memorandum of Association (MoA) and Articles of Association (AoA) are the key constitutional documents of the NGO:

• MoA defines the company’s mission and objectives.
• AoA outlines the rules and internal management regulations.

Ensure that these documents are tailored to the requirements of a Section 8 Company.

5. File SPICe+ Form (INC-32)

SPICe+ (INC-32) is the integrated form for company incorporation, name reservation, application for DIN, and allotment of PAN/TAN. This simplifies the registration process.

• Documents required:
  • MoA and AoA
  • Declaration by directors (in Form INC-9)
  • Proof of registered office address
  • Identity and address proofs of directors and subscribers
  • Specimen signature of directors

6. Pay Fees and Stamp Duty

Pay the government-prescribed fees for incorporation and applicable stamp duties, which vary by state and the company's authorized share capital.

7. Issuance of Certificate of Incorporation

After the Registrar of Companies (RoC) verifies the application and attached documents, the Certificate of Incorporation (COI) is issued. The COI will include the Corporate Identity Number (CIN) of the company, officially confirming its legal existence.

8. Apply for Section 8 License

Once the company is incorporated, you need to apply for a Section 8 License, which confirms the company's not-for-profit objectives.

• Form to file: File Form INC-12 along with the following documents:
  • MoA and AoA
  • Declaration by directors (in Form INC-14)
  • Declaration by a practicing professional (in Form INC-15)
  • Estimated statement of income and expenditure for the next three years

9. Obtain PAN and TAN

Upon receiving the Section 8 License, apply for the Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) for the company. This is essential for tax compliance.

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Post-Registration Compliance

1. Open a Bank Account

After incorporation, open a dedicated bank account in the name of the Section 8 Company for managing financial transactions related to the organization.

2. Apply for Tax Exemptions (Section 12A and 80G of the Income Tax Act)

To avail tax exemptions for the NGO, apply for registration under Section 12A. You should also apply under Section 80G to enable donors to claim tax deductions for their contributions.

3. Adhere to Annual Compliance

A Section 8 Company must comply with all annual filing requirements, including:

• Filing financial statements and annual returns with the MCA
• Submitting income tax returns

Failing to meet compliance can lead to penalties and jeopardize the company’s not-for-profit status.

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Conclusion

Establishing an NGO under Section 8 of the Companies Act, 2013, involves meticulous planning and adherence to legal procedures. However, the benefits of registering as a Section 8 Company are substantial, offering transparency, structure, and credibility to your social or charitable endeavors. By following the steps outlined, you can successfully register a Section 8 Company and contribute meaningfully to the causes you care about, while enjoying the legal benefits afforded to such organizations in India.