Section 8 Compliance

A Section 8 Company, governed by Section 8 of the Companies Act, 2013 in India, is a non-profit organization formed for promoting commerce, art, science, sports, education, research, social welfare, religion, charity, protection of the environment, or any other charitable purpose. Ensuring compliance is essential for the smooth functioning and legal standing of a Section 8 Company. Here are some key aspects of Section 8 Company compliance.

Annual Compliance:

Annual General Meeting (AGM): Hold an Annual General Meeting within six months from the end of the financial year. During the AGM, financial statements and reports should be presented.

Financial Statements: Prepare audited financial statements, including the balance sheet, income and expenditure statement, and the auditor's report.

Filing of Annual Returns: File annual returns with the Registrar of Companies (RoC) within 60 days of the AGM, providing details of the company's activities, financials, and governance.

Board Meetings and Resolutions:

Board Meetings: Conduct regular board meetings as required by the Companies Act. Ensure that there are at least four meetings in a calendar year.

Board Resolutions: Record board resolutions for important decisions made by the directors. Resolutions should be maintained in the company's records.

Changes in Board and Registered Office:

Change in Board Composition: Notify the RoC about any changes in the composition of the board of directors, including appointments or resignations, within the stipulated time.

Change in Registered Office: Inform the RoC of any change in the registered office address. This notification should be made within 15 days of the change.

Statutory Audits:

Appointment of Auditors: Appoint auditors for the Section 8 Company and ensure compliance with the requirements of statutory audits.

Audit Report: Obtain and submit the auditor's report along with the financial statements during the AGM.

Compliance with Tax Laws:

Income Tax Returns: File annual income tax returns as required under the Income Tax Act. Ensure compliance with the provisions for tax-exempt entities.

Specific Obligations under Section 8:

Utilization of Profits: Ensure that the profits or any income earned are utilized solely for the promotion of the company's charitable objectives. No distribution of dividends is allowed.

Amendment of Memorandum and Articles: Any proposed amendments to the Memorandum of Association and Articles of Association should be approved by the members in a general meeting and submitted to the RoC.