COMMENCEMENT OF BUSINESS CERTIFICATE
The Ministry of Corporate Affairs has re-introduced the concept of
commencement of business certificate. Under the newly introduced The Companies
(Amendment) Ordinance 2018, all companies registered in
India after the commencement of the Companies (Amendment) Ordinance, 2018
and having a share capital is required to obtain commencement of business
certificate before commencing any business or exercising any borrowing powers.
Since The Companies (Amendment) Ordinance 2018 was introduced in November 2nd
2018, any company incorporated after November 2018 would be required to obtain
Commencement of Business Certificate.
Time Limit for Obtaining Commencement of
Business Certificate
The commencement of business certificate must be obtained within 180
days of incorporation of the company. While filing the application for
commencement, each of the Directors of the company must declare that every
subscriber to the memorandum
has paid the value of the shares agreed to be taken by him/her on the date of
the making of such declaration.
ISSUES IN FILING CONDONATION OF DELAY
FOR E-FORM INC-20A: (OLD PROCESS)
1. Form INC-20A is required to be filed within 180 days of
the date of incorporation of the Company;
2. If you try to file the form after the above mentioned
period then it gives the error "Please file form INC-28 for condonation of
delay and then proceed to file form INC-20A"
3. Form INC-28 is an eform to be filed for filing of
"Notice of Order of the Court or any other competent authority". So
the process of condonation can not be completed with the said eform;
4. As per Section 460 of the Companies Act the applications
which could not be filed within the time specified therein than CG may for the
reasons record in writing can condone the delay;
5. An application under the said Section shall be filed in
E-form CG-1; but for the application of condonation of delay for delay in
filing the form INC-20A the form CG-1 is giving the error "Form Filing is
not allowed since Declaration for Commencement of Business is not filed in form
INC-20A. Please file form INC-28 for condonation of delay and proceed to file
form INC-20A";
RESOLUTION: INC 20A CAN NOW BE FILED
ALONG WITH LATE FEES.
Fee for Obtaining Commencement of Business Certificate
The Government fee for obtaining Commencement of Business
Certificate is as below:
|
Nominal
Share Capital |
Fee
applicable |
|
Less than
1,00,000 |
Rupees 200 |
|
1,00,000
to 4,99,999 |
Rupees 300 |
|
5,00,000
to 24,99,999 |
Rupees 400 |
|
25,00,000
to 99,99,999 |
Rupees 500 |
|
1,00,00,000
or more |
Rupees 600 |
If a company does not have share capital, a fee of Rs.200 would be
applicable. Further, in case of late filing of application for Commencement of
Business certificate, additional or higher Government fee as mentioned below would
be applicable on top of the penalty payable.
|
Period of
delays |
All forms |
|
Up to 30
days |
2 times of
normal fees |
|
More than
30 days and up to 60 days |
4 times of
normal fees |
|
More than
60 days and up to 90 days |
6 times of
normal fees |
|
More than
90 days and up to 180 days |
10 times
of normal fees |
|
More than
180 days |
12 times
of normal fees |
You may contact the author for further information
at 9899595719 or taxwizersconsultant@gmail.com
Disclaimer: The above article is only for
information purpose and is on based on the author’s interpretation of the
relevant provision. The same should not be considered as professional advice.
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