Filing Form 20A: Declaration for Commencement of Business

You must declare the commencement of your business by filing Form 20A with the RoC. File it timely, authenticate your business & be on the right side of the compliance procedures.

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What is form 20A and why is it filed?

Form 20A is filed by a company to declare the commencement of a business. This is as per section 10A of Companies (Amendment) Ordinance 2018, which states that every company with share capital, that is incorporated on or after 2 Nov 2018, should file form 20A with the ROC (Registrar of Companies), declaring the commencement of business. This form has to be filed by the company director/s within 180 days of the company’s date of incorporation. The information entered into the form is then verified by a Company Secretary or a Chartered Accountant. Additionally, filing form 20A forms an essential part of the compliance procedure involved in incorporating a company.

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Benefits of filing Form 20A


Eligible for borrowing money:

Companies who file Form 20A, within 180 days of incorporation will automatically make it eligible to utilize their borrowing powers to raise funds from other sources, such as financial institutions, banks, etc. However, if companies fail to file Form 20A, it makes them ineligible to borrow money.

Avoid Fines & Penalties

Companies who file the form INC-20A within 180 days of incorporation can obtain protection from fines and penalties. When it comes to penalties, companies can fine up to Rs. 50,000/- per day of default and company directors Rs. 1000/- default per day, up to a maximum of Rs. 1,00,000/-

Authenticate The Business

Companies who file the form INC-20A within 180 days of incorporation, are entered into a public database, with all information. The information is then available to the public, accessible at all times. Thus, enabling the business to be authenticated by the public which also helps in improving credibility.

Checklist Penalties for non-compliance of Form 20A

When it comes to filing form inc 20A, any negligence can attract hefty penalties. The goal is to reduce the number of fake or shell companies being incorporated. The penalties for filing form inc 20A, are as follows;

  • Defaulting Companies: Companies that do not comply with the basic requirement of filing form 20a for the commencement of business, will have to file a penalty of Rs. 50,000/-
  • Defaulting officers: Every company officer who is responsible for filing form inc 20A will be charged a penalty of Rs. 1,000/- day, for every day, until the form is filed until it reaches the maximum amount of Rs. 1,00,000/-
  • ROC removal of the company: The ROC can remove a company name from the registry, if the company has not executed any business transaction or operation, after 180 days of registering the business.

Form 20A fees levied by companies based on share capital

  • Where hare capital is less than Rs. 1,00,000, the form 20A fees is Rs.200/-
  • Where share capital is Rs. 1,00,000 or above but not exceeding Rs. 4,99,999, the form 20A fees is Rs.300/-
  • Where share capital is Rs. 5,00,000 or above, not exceeding Rs. 24,99,999, the form 20A fees is Rs. 400/-
  • Where share capital is Rs. 25,00,000 or above but not exceeding Rs. 99,99,999, the form 20A fees is Rs. 500/-
  • Where share capital is Rs. 1,00,00,000 or above, the form 20A fees is Rs. 600/-

When it comes to filing form 20A for companies with no share capital, the form 20A fees is Rs.200/-. However, if there is delay filing there are additional charges;

  • For a delay of up to 30 days, the additional charges are two times the standard fee.
  • For a delay of up to 30 days but not exceeding 60 days, the additional charges are four times the standard fee.
  • For a delay of more than 60 days but not exceeding 90 days, the additional charges are six times the standard fee.
  • For a delay of more than 90 days but not exceeding 180 days, the additional charges are ten times the standard fee.
  • For a delay of more than 180 days, the additional charges are twelve times the standard fee.

Process of filing form INC 20A

Get our legal assistance to file form INC 20A in an easy manner


Company Bank Account:

The first step is to open a company bank account (or a current account) for all its financial transactions. For which the following documents are required; Certificate of Incorporation, Memorandum Of Association, Articles Of Association, Permanent Account Number and Know Your Customer details of the company director/s

Collection of the capital:

The company needs to collect the capital invested by the company shareholders, as mentioned in the final page of the company’s memorandum of association, including the list of shareholders and amount invested by each.

Deposit capital share in the company bank account:

Once the capital invested by each shareholder is collected, it is deposited into the company bank account. Now, before filing a declaration of commencement of the business, the company has to acquire a certified copy of the bank statement, showing proof of deposit.

File Form inc 20A:

Finally, the declaration of the commencement of business is made by filing form inc 20A. The form is digitally signed by the company director/s and then certified by a valid CA or CMA

Documents required for filing Form 20A

When it comes to filing documents/attachments along with the form 20A,

  • Proof of payment by shareholders for the value of shares, as listed in the Memorandum of Association. For this purpose, it is mandatory to attach company bank account statements along with the form 20A.
  • The company is required to acquire a certificate of commencement of business within 180 days of the incorporation of the company. This certificate has to then be filed with the Registrar of Companies.
  • As per section 10A of Companies Act 2013, the company director/s will have to provide a declaration of the board resolution.
  • Proof of payment by shareholders for the value of shares, as listed in the Memorandum of Association. For this purpose, company bank account statements are attached along with the form 20A.
  • The company shall also obtain a registration or approval along with the attached declaration provided that the company pursues objects which require registration or support from a sectoral regulator from the example the Reserve Bank of India or the Securities and Exchange Board of India etc.

The form is required to be verified and certified by a practicing Company Secretary, Chartered Accountant or Cost Accountant before filing it with the Registrar of Companies (ROC).

Frequently Asked Questions

Yes, Form 20A is a mandatory requirement to declare the commencement of a business. As for the companies which are eligible to file form 20A, they are those that have been formed on or after 2 November, 2018, with a share capital.
The companies which are eligible to file form 20A, are those that have been formed before 2nd November, 2018, and have no share capital.
The due date for the first time filing of 'Form 20A' for companies incorporated on or after 2nd November 2018 within 180 days from date of incorporation.
The details required are that all shareholders (as listed in the MOA) have paid the total value of shares, as agreed by each shareholder.
Proof of payment by shareholders for the value of shares, as listed in the Memorandum of Association. For this purpose, company bank account statements are attached along with the form 20A.
In that case, instead of a bank account statement a valid payment proof like NEFT / IMPS receipts, can be attached.
Companies that do not comply with the basic requirement of filing form 20a for the commencement of business, will have to file a penalty of Rs. 50,000/-. Every company officer who is responsible for filing form inc 20A will be charged a penalty of Rs. 1,000/- day, for every day, until the form is filed and reaches the maximum amount of Rs. 1,00,000/-
The ROC can remove a company name from the registry, if the company has not executed any business transaction or operation, after 180 days of registering the business.

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