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WHAT IS SECTION 8 COMPANY?

 NGO (Non-Government Organization) works for non-profit/ charitable purposes. In India, there are 3 legal forms of NGO i.e. Trusts, Societies and Section 8 Companies. An NGO established as Section 8 companyunder the Companies Act, 2013 is governed by the Ministry of Corporate Affairs (MCA).A Section 8 Company is the same as the Section 25 Company under the old Companies Act, 1956. Section 8 Company is incorporated for the promotion of commerce, art, science, education, research, sports, charity, social welfare, religion, protection of environment or any such other object. It is formed for the welfare of the society and it intends to apply all its profits in promoting its objects. It forbids the payment of dividend or income to its members. Therefore, Section 8 Company is created by those who do not wish to earn profit from the business but rather they want to dedicate themselves to improve a certain segment of the society.

What are the benefits of Section 8 Company?

  1. Tax benefits

  2. No Stamp duty

  3. Creditability

  4. No Minimum Capital Requirement

  5. Limited liability

  6. Name

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