Form INC-20A Filing – Commencement of Business, Due Date, Documents & Penalty

Form INC-20A, also known as the Declaration for Commencement of Business, is an important post-incorporation compliance requirement for companies having share capital.

A company covered by Section 10A of the Companies Act, 2013 cannot commence business or exercise borrowing powers until the prescribed requirements have been fulfilled.

The declaration is filed with the Registrar of Companies through the MCA portal by a director of the company.

The primary purpose of INC-20A is to confirm that every subscriber to the Memorandum of Association has paid the value of the shares agreed to be taken by that subscriber.

The declaration is required to be filed within 180 days from the date of incorporation. The current MCA instruction kit confirms that a company having share capital must file the declaration through INC-20A within 180 days.

Form INC 20A filing services provided at K M Gatecha & Co LLP:

• Obtaining CIN number,
• DSC of director/s,
• Collection of documents,
• Filling e-form INC 20A,
• Submission of form INC 20A,
• Replying to any queries raised.

Our Process of FORM INC 20A:

• Collection of documents,
• Preparation of FORM 20A,
• Filling and filing of Form 20A,
• Submission of form,
• Obtaining certificate of commencement.

INC-20A at a Glance

What is Form INC-20A?

INC-20A is the statutory declaration filed by a company to confirm commencement of business.

Section 10A requires the director to declare that every subscriber to the Memorandum of Association has paid the value of shares that the subscriber agreed to take.

The company must also comply with the registered-office verification requirement under Section 12 before commencement requirements are treated as complied with.

Section 10A specifically restricts the company from:

commencing any business; and

exercising borrowing powers

until the statutory requirements are fulfilled.

Eligibility criteria of Form INC 20A:

• Any company that has been incorporated after 2^nd November 2018 has to file INC-20A as per due date prescribed by Ministry of corporate affairs,
• Company should have share capital.

Who is Required to File INC-20A?

INC-20A is generally applicable to a company:

• incorporated under the post-2 November 2018 commencement-of-business regime;
• having share capital; and
• required to comply with Section 10A of the Companies Act, 2013.

This commonly includes:

Private Limited Companies

Public Limited Companies

One Person Companies having share capital

and other companies satisfying the statutory conditions.

The MCA V3 system itself permits INC-20A filing only for a company having share capital.

What is the Due Date for INC-20A?

Form INC-20A must ordinarily be filed:

Within 180 days from the date of incorporation of the company.

Example

If a company is incorporated on:

1 April 2026

the 180-day period should be calculated from the date of incorporation and INC-20A should be filed within the statutory period.

The MCA system uses the date of incorporation as the event date for calculation of the filing period.

Most Important Condition Before Filing INC-20A

Before filing INC-20A:

Every subscriber to the Memorandum of Association must have paid the value of the shares agreed to be taken by him or her.

Example:

Suppose a company is incorporated with the following subscription:

The agreed subscription amount should be received in accordance with the applicable requirements before the director makes the INC-20A declaration.

The form should not be filed merely because the company has been incorporated.

Documents required for filing INC-20A:

• Bank statement of Company as proof of payment by shareholders for the value of shares as mentioned in the Memorandum of association,
• Digital signature of Director,
• Company Identity number (CIN),
• Director identity number (DIN) if the digital signature on e-form is of a director,
• PAN card if the signing person is a secretary,
• Certificate of practice number if the person is a company secretary in whole-time practice,
• Declaration of board resolution by the company director as per section 10A of Companies Act 2013,
• Certificate of commencement (to be obtained within 180 days of incorporation and filed with the registrar of companies).

MCA Fees for Filing INC-20A

Normal filing fees depend on the company’s nominal share capital.

The current MCA instruction kit uses these share-capital-based filing fees.

Additional Fees for Late Filing of INC-20A

Where the form is filed after the prescribed period, additional filing fees apply.

The final payable amount should be taken from the MCA portal at the time of filing because fees remain subject to the applicable Rules and MCA system computation.

Other requirements:

• Registration or approval for any objects which require registration or support from regulator such as Reserve bank of India or Securities and Exchange Board of India,
• The form has to be verified and certified by practicing Company Secretary, Chartered Accountant or Cost Accountant be being filed with the Registrar of Companies.

Benefits of filing Form INC 20A:

• Easier to borrow capital,
• Authentication of business,
• Avoidance of fines and penalties.

Penalties or fines for non-compliance for Form INC 20A:

• Companies that do not file form INC 20A for commencement of business will be penalised for INR 50,000/-,
• Every officer who is responsible for filing FORM INC 20A will be charged a penalty of INR 1000/- for every delayed day (maximum up to INR 1,00,000/-),
• ROC can remove the company from registry for non-compliance of filing Form INC 20A.
• Company will not be able to commence business without filing Form INC 20A.

Importance of Filing Form INC-20A

Filing Form INC-20A is crucial for several reasons:

• Legal Compliance: Ensures adherence to the Companies Act, 2013, avoiding legal repercussions.
• Operational Authorization: Empowers the company to commence business activities and exercise borrowing powers legally.
• Credibility: Enhances the company’s credibility with stakeholders, including banks, investors, and regulatory authorities.
• Avoidance of Penalties: Timely filing helps in avoiding substantial fines and penalties imposed for non-compliance.

Procedure for Filing Form INC-20A

The process of filing Form INC-20A involves several steps:

1. Access the MCA Portal:
   • Visit the MCA portal.
   • Log in using valid credentials.
2. Download and Fill Form INC-20A:
   • Navigate to MCA Services > Company Forms Download.
   • Download Form INC-20A.
   • Accurately fill in the required details, including CIN, company name, and registered office address.
3. Attach Necessary Documents:
   • Upload the required documents as attachments.
4. Certification by a Professional:
   • The form must be verified and certified by a practicing Chartered Accountant (CA), Company Secretary (CS), or Cost Accountant.
5. Submit the Form:
   • Use the DSC of the authorized director to sign the form digitally.
   • Upload the form on the MCA portal and pay the requisite fees.
6. Acknowledgment:
   • Upon successful submission, an acknowledgment email is sent, and the status can be tracked on the MCA portal.

Difference Between INC-20A and INC-22

These two forms serve different purposes.

Section 10A also requires compliance with the registered-office requirement under Section 12. Accordingly, registered-office compliance should be checked before filing INC-20A.