The Finance Minister announces Zero Fees for registration of Companies having Authorised Capital up to Rs 10 Lakh. The Ministry of Corporate Affairs has published notification in Official Gazette of India to amend Companies (Registration Offices and Fees) Rules, 2014. The amended rule will come in force since 69th Republic day of India on 26th of January, 2018.
MCA has confirmed that incorporation fees will not be applicable on filing of form INC-32 (SPICe) for incorporation of companies with a nominal capital of less than or equal to INR 10,00,000 or in respect of companies not having a share capital whose number of members as stated in the articles of association does not exceed twenty, with effect from January 26, 2018. Further, initiatives have been undertaken to simplify reservation of name of company and also for allocation of DIN.
Launch of web form facility RUN (Reserve Unique Name) in replacement of earlier e-form INC – 1 for name reservation by companies.
Key Elements:
Form was launched on 26th January, 2018.
On approval of form, name will be approved for a period of 20 days for further processes by the companies.
No re-submissions will be allowed for the application.
Zero Fees for incorporation forms of companies having Authorised Capital up to Rs 10 Lakh.
Key Elements:
- The Ministry has amended the fees payable to the Registrar to incorporate the companies under stated Rules.
- The Companies claiming the benefit of Zero Fees for incorporation shall maintain the status of small companies till one year. Therefore, the companies cannot increase its Authorised Capital above 10 lakh within span of 1 year form its incorporation.
- The fees payable to States are not reduced or eliminated i.e. the Stamp Duty on MoA and AoA of the companies will stay intact.
Thus notification only covers the fees structure for incorporation of Companies.
Purpose of the Amendment :
This amendment has been initiated in order to improve India’s ranking with respect to Ease of Doing Business in the country. Also, as per a Press Release[3], these initiatives are in furtherance of launching Government Process Re-engineering (GPR) initiatives for making the incorporation process speedier and reducing the number of procedures involved for starting a new Business.
In accordance with above three initiatives, the Companies (Incorporation) Amendment Rules, 2018[4] and the Companies (Registration Offices and Fees) Rules, 2014[5] have been released.
Conclusion:
These small steps of Government will help to promote entrepreneurship and encourage youth to come forward with their brilliant ideas to make India more progressive towards untouchable heights. The Government has been taking active steps to improve the rankings regarding the Ease of Doing Business published annually by the World Bank. The companies being incorporated in the year 2018 will benefit from these initiatives and this is expected to improve India’s ranking in the World Bank’s report as well.
