Incorporating a private limited company is only the beginning of a company's compliance journey. After incorporation, certain companies are required to complete additional statutory compliances before commencing business activities or exercising borrowing powers. One important compliance is INC-20A, the declaration for commencement of business.

For entrepreneurs completing Company Registration in Delhi, understanding INC-20A is particularly important because missing an applicable post-incorporation compliance can result in penalties and restrictions.

This guide explains what INC-20A is, who needs to file it, the applicable timeline, documents, filing process, and common mistakes.

What Is INC-20A?

INC-20A is a declaration filed by certain newly incorporated companies regarding the commencement of business.

Under Section 10A of the Companies Act, 2013, companies incorporated after the commencement of the relevant provision and having share capital are required to file a declaration before commencing business or exercising borrowing powers, subject to the applicable legal requirements.

The declaration confirms that the subscribers to the company's memorandum have paid the value of shares agreed to be taken by them.

Who Needs to File INC-20A?

Generally, a company incorporated with share capital that falls within the scope of Section 10A is required to file the commencement declaration.

This can include newly incorporated:

• Private Limited Companies
• Public Companies
• Other companies with share capital covered by the applicable provision

The requirement should be checked based on the company's incorporation date, structure, and applicable provisions.

Companies incorporated before the relevant commencement of Section 10A may not be subject to the same requirement.

When Should INC-20A Be Filed?

The declaration is generally required to be filed within 180 days of the date of incorporation.

The company should ensure that the required subscribers have paid the agreed value of shares before filing the declaration.

The filing should not be treated as an optional formality. Companies should track the deadline from the incorporation date and complete the applicable compliance within the prescribed period.

Why Is INC-20A Important?

INC-20A is important because the applicable company may face restrictions if the declaration is not filed.

A company required to file the declaration should generally not commence business or exercise borrowing powers until the applicable declaration has been filed.

Failure to comply can also expose the company and responsible officers to statutory consequences under the Companies Act.

Therefore, founders should include INC-20A in their post-incorporation compliance checklist.

Documents and Information Required for INC-20A

Before filing INC-20A, the company should keep relevant information and supporting records ready.

Common requirements may include:

• Certificate of Incorporation
• Corporate Identification Number (CIN)
• Company PAN
• Registered office details
• Details of subscribers
• Shareholding information
• Proof that subscribers have paid for their shares
• Bank statement or other applicable evidence
• Director's details
• Digital Signature Certificate (DSC)

The exact attachments and requirements should be checked against the current MCA filing instructions and applicable rules.

How to File INC-20A Step by Step

Step 1: Confirm the Filing Requirement

First, determine whether the company is covered by the Section 10A commencement declaration requirement.

Step 2: Confirm Share Capital Payment

The subscribers should have paid the agreed value of the shares they have undertaken to take.

The company should maintain appropriate evidence of the payment.

Step 3: Collect Company Information

Keep the company's CIN, incorporation details, registered office information, subscriber details, and other required information ready.

Step 4: Prepare the Form

Access the applicable MCA filing system and complete the INC-20A form with accurate company and subscriber information.

Step 5: Attach Supporting Documents

Attach the required evidence demonstrating that the subscribers have paid the value of shares agreed to be taken.

Step 6: Digital Signature

The applicable declaration needs to be authenticated using the required digital signature.

Step 7: Professional Certification

Where required, the form must be certified by a practicing professional in accordance with the applicable MCA requirements.

Step 8: Submit the Form

Submit the completed form through the MCA portal and pay the applicable statutory filing fee and additional fee, if any.

Step 9: Save the Filing Acknowledgement

After successful submission, retain the Service Request Number and filing acknowledgement for the company's records.

What Happens After Filing INC-20A?

After submission, the MCA system processes the filing according to the applicable process.

The company should retain:

• Filed form
• Payment receipt
• SRN
• Supporting documents
• Filing acknowledgement

These records may be useful for future statutory compliance, due diligence, banking, funding, or other corporate requirements.

Penalty for Non-Filing of INC-20A

Failure to comply with Section 10A can result in statutory consequences.

The company may be liable to a prescribed penalty, and officers in default can also face consequences under the Companies Act.

Additionally, the Registrar of Companies may take action where the company has not filed the required declaration.

Because penalties and statutory provisions can change, companies should check the current Companies Act, applicable rules, and MCA requirements before relying on a particular penalty amount.

Common Mistakes While Filing INC-20A

Companies should avoid common errors such as:

• Missing the 180-day deadline
• Filing without confirming subscriber payment
• Providing incorrect CIN or company details
• Uploading inadequate supporting documents
• Using incorrect subscriber information
• Not checking the latest MCA form requirements
• Ignoring other post-incorporation compliances

Completing INC-20A should be part of a broader post-incorporation compliance process.

INC-20A After Company Registration in Delhi

Entrepreneurs completing Company Registration in Delhi should prepare a post-incorporation compliance calendar immediately after receiving the Certificate of Incorporation.

Apart from INC-20A, a company may have other applicable obligations relating to:

• Statutory registers
• Accounting records
• GST registration
• TDS
• Income tax
• Board meetings
• Annual filings
• Audit
• Other regulatory requirements

The exact obligations depend on the company's activities, structure, turnover, transactions, and applicable laws.

How TaxCaller Can Help

TaxCaller provides company registration, taxation, accounting, and business compliance services for entrepreneurs and companies.

Businesses completing Company Registration in Delhi can seek assistance with post-incorporation compliance, including understanding the INC-20A filing requirement, organizing relevant documents, and coordinating applicable statutory filings.

TaxCaller also provides GST registration and filing, ITR filing, accounting, bookkeeping, TDS compliance, tax audit, trademark registration, MSME/Udyam registration, and other business compliance services.

Conclusion

INC-20A is an important post-incorporation compliance for companies covered by Section 10A of the Companies Act, 2013. The declaration confirms that the subscribers have paid the agreed value of shares and must generally be filed within the prescribed 180-day period.

Entrepreneurs completing Company Registration in Delhi should include INC-20A in their post-incorporation compliance checklist and maintain proper evidence of subscriber share payments.

Since company law requirements and MCA filing procedures can be updated, companies should verify the latest applicable requirements before filing. Professional assistance can also help businesses organize their documents and manage their post-incorporation compliance systematically.