Incorporation is not the end of the process. A company registered with a share capital cannot legally start business, and cannot exercise any borrowing powers, until it files Form INC-20A. The deadline is 180 days from the date of incorporation, and the penalty for missing it is ₹50,000 on the company plus ₹1,000 a day on every officer in default.
Starting at
₹1,999 onwards
INC-20A
Every company incorporated with share capital
Timeline
Within 180 days of incorporation
Section 10A of the Companies Act, 2013 provides that a company incorporated after 2 November 2018 and having a share capital shall not commence business or exercise any borrowing powers unless a director files a declaration within 180 days of incorporation stating that every subscriber to the memorandum has paid the value of the shares agreed to be taken by him. That declaration is Form INC-20A, filed under Rule 23A of the Companies (Incorporation) Rules, 2014. The substance of it is simple: the government wants proof that the paid-up capital you declared at incorporation actually reached the company's bank account.
TL;DR
Applies to every company incorporated on or after 2 November 2018 with a share capital - private limited, public limited and OPC. It does not apply to companies without share capital (in practice Section 8 companies limited by guarantee), or to LLPs. The deadline runs from the date of incorporation, not from the date the bank account was opened.
Section 10A
The provision barring commencement of business and exercise of borrowing powers until the declaration is filed.
Subscription money
The value of the shares each subscriber agreed to take in the memorandum, which must actually reach the company's account from that subscriber's own account.
Officer in default
Each officer liable to ₹1,000 per day of continuing default, capped at ₹1,00,000.
Section 248 strike off
The Registrar may strike the company off on the reasonable ground that it is not carrying on business - the exposure founders most underestimate.
The ordinary route. One form, one substantive attachment, filed with the MCA fee for your capital slab.
Still filed, but with the additional fee and exposure to the Section 10A penalties.
Banks will open a current account on the certificate of incorporation, and many companies begin trading immediately. That does not make it lawful.
01
Each subscriber must have paid the value of the shares agreed in the memorandum, from their own account. We check the credits against the memorandum before anything is filed.
02
Bank statement, advice or payment challan evidencing receipt from each subscriber. This is the single point on which INC-20A filings fail.
03
Board resolution authorising the filing, and the digital signature of one director. Sectoral regulator approval attached where the objects require it.
04
Filed on the MCA portal with the fee for your share capital slab. We confirm the SRN and the approval.
Upload via our secure portal. We pre-check every scan before filing - cuts portal rejections by ~90%.
Still unsure if INC-20A is right for your case? Book a free 20-minute consult - a senior CA / CS will walk you through your specifics.
Still have questions?
Book a free 20-minute consult with a senior partner - we'll walk through your case and outline next steps.
Talk to a partner →A senior CA / CS will get on a call with you, confirm scope and start the work - usually within 24 hours.
