Can section 8 company receive FDI?

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A non-profit company or section 8 company is a company in the form of promotion of trade, art, science, sports, education, research, social welfare, religion, charity, environmental protection or any other thing; wants to impose your profit, if any, or other income for the promotion of its goods; and intends to withhold the payment of any bonus or dividends to its members.

It operates as a limited company, which includes all the rights and obligations that come with such a company. 

However, it differs from a company in a very important aspect, meaning it cannot use the words “Section 8” or “Limited” in its name. Section8 company is the most popular NGO online registration form in India. It is easy to register, run, or manage.

Section 25 is a previous version of the company (under the Companies Act, 1956). Section 8 companies are legal forms of non-profit organizations (NPOs) or non-governmental organizations (NGOs). Section 8 company has the right to operate anywhere in the country.

The entire method of registering a new Section 8 company is online – there is no need for physical copies of documents or a visit to the registrar’s department for business registration.

Documents required for a Section 8 company registration in India:

  • Proof of identity of all shareholders and directors. (Passport / Aadhaar Card / Voter ID)
  • Proof of address of bank account statement/electricity bill / mobile bill of all directors and shareholders
  • PAN card of all shareholders and directors
  • Utility bill of proposed office i.e. proposed registered office for the company
  • A No Objection Certificate from the landlord where the company’s office will be located
  • Signed the DSC form of all the directors of the proposed company duly.

 Important Information for Section 8 Company in India

Director Detail:

  1. Educational qualification of all directors.
  1. Profession / Business of all Directors with Area of ​​Operation
  1. Citizenship with the residential status of all directors
  1. Place of birth of all directors
  1. Permanent and current residential status of all directors
  1. Contact numbers of all directors
  1. Email of all directors

Creating a nonprofit company is a company that:

  • Its objects include art, commerce, sports, science, education, social welfare, research, religion, charity, protection of the environment, or any other such thing;
  • Intends to exert its profit, if any, or other income in promoting its objects; And
  • Intends to prohibit the payment of any bonus or dividend to its members.

Can a Section 8 company raise capital through FDI?

Yes, FDI is permitted under Section 8 companies act subject to compliance with FEMA regulations. In simple terms, although FDI is allowed in Section 8 companies, as it is considered a foreign contribution in terms of FCRA, it can be infected only with prior approval/registration by the Central Government.

Although, know more about the NGO registration process, Section 8 companies, FDI contact with our expert team available at Chartered Munshi as we are among the leading NGO registration consultant.

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