How do I find out if a company is section 8?

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Section 8 Companies Act 2013 provides for the formation of companies with charitable goods etc. Section 8 company registration, is a legal entity for non-profit organizations and non-government organizations.

Examples of Section 8 Companies Reliance Foundation, Reliance Research Institute, Tata foundation, etc.

Section 8 Company objectives:

It is a type of company established to promote commerce, arts, science, sports, education, research, social welfare, protection of the environment, or any other such item. Section 8 The main objective of the company is essential to work for the welfare of the society in any of the above areas and is constituted in the public interest.

A Section 8 company is registered under the Ministry of Corporate Affairs under the Central Government.

Section 8 Companies Features:

No bonus

Members of the company do not receive any bonus.

The profits

Any type of profit or income of the company is applied only for the promotion of the goods of the company.

Special license

For the formation of any other company, Section 8 company is required to obtain a special license from the Central Government. Every requirement must be needed to follow to run a company, but in the case of a Section 8 company, a special license is required for its incorporation by applying the ROC. As part of a procedure for following Rule 19 of the Companies (Incorporation) Rules, 2014, Section 8 provides for the issuance of licenses for a company.

Use of suffix

Section 8 Company cannot use ‘Private Limited’ or ‘Limited’ with its name.

Not small company

A Section 8 company will not be treated as a small company.

Power of Registrar of Companies (‘ROC’)

The power of the central government is delegated to the ROC, which has jurisdiction over the area where the company’s registered office is located. Therefore, ROC will have to apply to register the company.

One person company conversion

Section 8 company cannot be converted into an individual or one-person company.

Firm as a member of a non-profit company

As per Section 8 (3) Company Act, 2013, a partnership firm can become a member of a nonprofit or NGO online registration under Section 8. Such members of the firm will terminate upon dissolution of the firm. However, partners of that dissolved firm may remain members of the company in their capacity.

Transferable ownership

Unlike other businesses, where it is not possible to easily transfer ownership, in a Section 8 company, members’ shares and other interests are treated in movable property and can be easily transferred as provided by the article. Due to which it is easy to relinquish membership of the Section 8 Company or transfer its ownership.

Shareholders and directors:


  • The company must have at least 2 shareholders.
  • At least 2 directors are required.
  • Directors and shareholders can be the same person.
Share capital

No minimum share capital is required. The required funds are brought in the form of donations, memberships from members of the general public.

Limited liability

One of the benefits of a Section 8 company is its limited liability. In simple terms, if a liability increases, the members of the company are not personally affected; members are liable for unpaid shares held by them and not more than this.

Greater flexibility

A Section 8 company is not required to perform many legal formalities as a public company or as an NGO registration process. It enjoys special exemptions and privileges under company law.

Separate legal entity

The most prominent feature of a Section 8 company is its separate legal identity. In a Section 8 company, the company and its members have a completely distinct identity.

For more information in detail, you may appoint years of experienced Chartered Munshi as an NGO registration consultant. We give you the best consultancy and also we have a well-experienced team.

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Harpreet Singh

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